TaxTMI 
TaxTMI 
2020 (2) TMI 1405
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.... and interest @ 18% p.a., in respect of all the Homebuyers. 2. Brief facts of the case, as mentioned in the Company Petition, which are relevant to the issue in question, as follows: (1) M/s. Skylark Ithaca Buyers Welfare Association Consisting of 255 Homebuyers (hereinafter referred to as Petitioners/ Financial Creditors) are Home Buyers, who have entered into Agreements of Sale and Constructions, on various dates for purchase of Apartments of varying sizes, in the residential Apartment Complex proposed by Skylark Mansions Private Limited. The said Skylark Mansions Private Limited entered into Three (3) Joint Development Agreements with the Landowners and One (1) Supplemental Agreement with the Landowners of the composite property, on which the proposed residential apartment complex was being constructed. The said Landowners had also executed Powers of Attorney in favour of Skylark Mansions Private Limited to sell undivided right in the composite property proportionate to the built-up area to prospective purchasers such as the Financial Creditor/Member of the Association/Home Buyers. The said Skylark Mansions Private Limited had also obtained sanction plan from the Ban....
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....landowners in respect of Sy. Nos. 24/4, 24/5, 24/6 of Kodigehalli Village and Sy. Nos. 28, 29, 30/1, 32/1 of Kurudu Sonnenahalli Village, K.R. Puram, Bangalore admeasuring approximately 20 Acres along with Certain Supplemental Agreements (SA's) and that under the said JDA's, SA's, etc., it was agreed that the Corporate Debtor would be entitled to develop the said property into a multi-storeyed Residential Apartment Building and accordingly had secured a Development Plan, sanctioned by the Bangalore Development Authority on 16.11.2013 and that the Corporate Debtor had also obtained a Building Construction Plan vide LP No. 68/2013-14 dated 24.02.2014 for construction of Five (5) buildings. The details of which are mentioned herein below: i) BUILDING-1:- 6 towers (Tower 1 to Tower 6) comprised of Lower and Upper basement, Ground +19 Floors. ii) BUILDING-2:- 2 towers (Tower 7 & Tower 8) comprised of Lower and Upper basement, Ground + 19 Floors. iii) BUILDING-3:-3 Towers (Tower 9, 10 & 11) comprised of Lower and Upper basement, Ground +19 Floors. iv) BUILDING-4: - 5 Towers (Tower 12, 13, 14, 15 &16) comprised of Lower and Upper ba....
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....suring that all amounts under the aforesaid Agreements were received by IEPL for and on behalf of the Corporate Debtor. As on date, the Financial Creditors have paid over 90% of the consideration/cost to the Corporate Debtor through IEPL, though the extent of construction was/is not commensurate with the payments made. These payments had to be made by the Financial Creditors, to avoid delayed payment interest, penalty and any whimsical action at the Corporate Debtors end. The Financial Creditors have also been servicing the loans/facility availed from their bankers by regularly paying the Equated Monthly Instalments (EMI's), in order to avoid any action from the Bank and to avoid their credit worthiness being affected. (7) It is submitted that some of them have entered into Agreements with IEPL, under which they were made to pay an additional sum of over Rs. 400 per square foot and IEPL having received the additional consideration had agreed to pay the pre-EMI value/interest directly to the banks, on behalf of the Financial Creditors. This obligation under the Agreement was discharged by IEPL, only for the first few months and thereafter, for over two (2) years, the sa....
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.... Creditors for a meetings dated 13.09.2018 and 22.09.2018. In the said meeting, it was agreed by the Chairman and Managing Director Mr. Saleem Sheriff of the Corporate Debtor and IEPL that the construction which was dormant would resume by October 2018 and that the Apartments in the respective Towers would be handed over to the Financial Creditors, between March, 2019 and June, 2019. However, there has been no progress with the construction. (11) The details of the Financial Creditors, the Apartment Nos. they have contracted for, Agreement date, Amount paid, etc., are mentioned herein below: Sl. No. Names Tower & Plat Number Total Cost in Rs. Agreement Date Amount Paid Interest @ 18% 1 Veni Pranavananda T4-402 6,454,546 23-Sep-14 5,743,047 4,266,550 2 S. Chandra Mouli and Shanthi C Mouli T2-1404 3,148,278 23-May-14 2,982,662 2,210,941 3 Priyanka Shaw T9-7050 6,100,000 30-Jan-19 4,671,707 2,586,729 4 Ayushi Mahajan and Adhish Mahajan T6-1105 5,537,194 04-Jul-17 4,930,774 2,132,....
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....at Chaudhuri & Rupanjali Chaudhuri T2-603 6,069,683 09-Aug-14 5,106,519 3,798,930 27 Ranjeet Das & Sanjeeb Kumar Das T2-506 6,288,698 23-May-14 5,587,226 4,185,513 28 Rajani Menon & Rajeev Menon T2-1705 3,389,349 08-Aug-17 2,879,000 1,027,518 29 Soubhagya Hota T2-406 6,598,952 11-Nov-14 5,909,497 4,284,626 30 M. Girish Kini and Kripa Kini T2-003 5,745,590 24-Sep-14 5,053,397 3,771,918 31 Mainak Das T2-1306 6,561,311 01-Jun-16 5,955,608 3,648,110 32 Shailesh Jaiswal T2-1903 7,075,237 29-Dec-17 6,367,713 1,881,656 33 Praveen Kumar Tiwari T2-905 4,721,658 24-May-14 4,168,449 3,130,012 34 Chiranthan Purushotham T2-1205 49,313,030 23-May-14 4,371,573 3,033,008 35 Vipul Ranjan & Reshu Sinha T2-705 5,660,468 15-Nov-17 4,811,398 1,474,192 36 Umesh K. & Ranjani B. T2-1303 7,450,000 12-Jan-....
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....867,458 57 Paridhi Jain & Pramod Jain T6-705 5,341,081 08-May-14 5,011,370 4,045,322 58 Neetu Sharma & Dinesh Sharma T6-1405 5,529,675 06-Nov-14 5,094,946 3,824,348 59 Anil Kashiram Umadi and Aishwarya Kashiram Umadi T12-1305 6,142,991 25/10/2017 4,638,382 1,500,484 60 Rajesh Kumar Jha & Archana Jha T10-705 6,129,063 09-Jan-15 4,319,524 2,968,777 61 Rohit Kumar and Priyanka Dabiru T7-201 6,765,709 08-Jun-14 6,003,240 4,369,634 62 Sagar Iyer T7-904 8,126,000 04-Jan-17 6,553,653 2,959,628 63 Sangameshwar T7-1503 7,708,194 09-Sep-14 6,853,565 5,160,907 64 PM Madhusoodhanam T7-702 8,200,000 10-Jan-14 7,380,741 5,903,418 65 Satyendra Pratap Singh & Madhulika Singh T7-1003 7,196,394 06-Aug-14 6,849,600 5,392,772 66 Regina A & Bibin Basheer T8-101 7,634,604 20-Sep-16 6,830,370 3,534,595 ....
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.... 87 Alok Kumar Singh & Seema Singh T10-906 4,925,142 29/06/2014 4,351,057 3,232,891 88 Neeta Mishra & Mithilesh Mishra T10-605 4,214,225 08-Jun-14 3,681,851 2,361,528 89 Raghavendran Tiwari T10-1205 5,929,214 03-Feb-18 5,336,302 1,362,541 90 Suraj Kumar Singh & Anjana Singh T10-501 4,580,113 25/11/2014 4,036,811 3,037,222 91 Dinesh Nandini Ray & Ajay Kumar Nayak T10-1206 6,243,033 30/12/2014 4,319,526 3,272,738 92 Abhijeet S Karkare & Vasundhara Karkare T10-1806 11,147,370 22/01/2018 9,898,000 2,776,047 93 Santanu Chakrabarty & Roshni Saraf T11-1405 5,271,307 08-Jan-14 4,458,970 3,455,125 94 Saurabh Bajpai and Ayushi Bajpai T11-506 5,610,301 28-Oct-14 5,237,821 3,657,065 95 Randhir Kumar & Pallavi Dutta T11-1605 5,929,214 15/11/2017 5,632,753 1,357,465 96 Tapan Khilariwal T11-1005 5,045,430 21/11/2014 4,034,580 ....
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....,522 117 Nand Kishore Sapra T1-1303 5,528,203 23/04/2015 4,991,214 3,625,942 118 Vikash Anil & Nehawashini Anil T7-302 7,018,601 28/05/2014 5,373,879 4,335,240 119 Aman Choudhary T6-902 5,062,199 25/06/2014 4,494,065 3,415,948 120 Pradeep Kumar NG T4-702 6,424,391 10-May-14 5,809,714 4,210,576 121 Guruprasad Gaonkar T9-406 6,675,638 09-Jan-14 5,632,496 4,232,953 122 Chandra Kaladhar NM T11-106 6,056,076 25/08/2015 4,366,749 2,987,014 123 Prasada Rao Gorle T9-1301 5,500,000 14/05/2015 4,077,404 3,108,209 124 Chandrakanth Shettigar T1-803 4,880,957 06-Oct-14 4,329,517 3,232,660 125 Nitin Gupta & Shaleen Gupta T8-1401 7,824,085 21/08/2014 7,076,611 5,687,567 126 Mylsamy Karuppagounder T11-601 4,623,140 17/02/2015 4,108,727 2,952,760 127 Rajesh Samal & Suvalaxmi Rout ....
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..../2018 6,000,000 1,507,532 149 Ravi Ranjan Sharma T5-905 5,943,390 12-Sep-14 4,133,896 3,177,354 150 Joseph Kuruvilla Thomas T13-1203 6,338,803 04-Nov-16 5,382,640 2,509,114 151 Simrati Kaul & Abhishek Raina T7-301 6,723,135 28/05/2014 5,985,608 4,419,777 152 Binny V Kuruvilla & Vinitha Ponnachen T2-106 6,200,000 12-Oct-14 5,232,434 3,773,484 153 Ajay Shankar & Shalinee Kumari T10-1106 6,266,445 28/07/2015 4,409,919 3,062,655 154 Sumesh Krishnan Iyer & Madhvi Sumesh Iyer T5-1104 3,908,650 14/06/2018 3,059,449 1,723,581 155 Vivekanand R Mathapati T13-1103 6,315,547 24/03/2016 5,252,527 2,882,151 156 Vivekanand R Mathapati T18-603 7,478,680 21/03/2016 7,131,526 3,761,618 157 Sundeep Mardraj T6-1201 5,291,094 02-May-17 4,715,429 1,871,993 158 Subhabrata Chakraborty & Sneha Sinha T8-1202 7,328,568....
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....ngh T7-902 7,260,969 29/09/2014 6,359,074 4,716,080 178 Yuvika Chaube & Viswanath Subramanian T7-1002 7,263,485 05-Jan-14 6,419,752 4,981,943 179 Jerome Chrishesh Sigamoney & Christina Sangeetha Thomas T2-605 4,744,618 24/05/2014 4,209,206 3,125,356 180 Vinay Cherkur T11-806 5,646,390 03-Aug-15 5,065,732 3,544,402 181 Amit Kumar Gupta and Manila Rauniyar T5-1801 9,117,275 19/07/2014 8,078,040 6,031,407 182 Arvind Kandula and Jaya Kandula T18-203 8,360,090 19/03/2016 6,584,451 3,874,785 183 Shri. Thirthankar Haider and Smt. Ishrat Jahan T6-305 4,902,130 30/05/2014 4,328,462 3,260,398 184 Shreeparna Mazumdar T5-1405 6,000,000 21/09/2016 4,581,004 1,877,073 185 Sarabjit Singh Tatra & Preeti Saini Ugra T5-203 6,265,779 14/02/2014 5,531,105 4,204,169 186 Nilay Deshpande & Revati Deshpande T2-203 6,211,307 20/06/2014 5,666....
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.... Singh and Sunita Singh T1-703 4,879,517 24/12/2014 4,306,986 3,200,555 208 Hota Naga Sandhya T13-102 5,965,859 04-May-16 4,795,452 2,705,567 209 Sachin R. Vaity and Madhuri S. Vaity T3-705 5,713,038 21/04/2015 5,081,966 3,521,952 210 Shiva Singh & Siddharth Saroha T4-204 7,082,746 31/03/2015 5,172,005 3,798,492 211 E. Dinesh and Kavitha Athlur T10-1301 4,972,112 19/07/2014 4,007,421 3,021,806 212 Sandeep Sethi and Harpreet Kaur T3-1403 5,929,214 02-Jan-17 5,039,831 1,483,915 213 S. Prabhakaran & V. Srividhya T6-1003 5,096,236 07-Apr-14 4,511,609 3,404,165 214 Venkata Sudheer Kumar Chunduri and Lavanya Voruganti T6-1705 4,537,002 09-Jun-17 2,900,000 1,046,762 215 R Balaraaman T15-1203 7,490,899 26/04/2016 5,738,746 3,022,131 216 Akhil Koul and Rajni Koul T8-1503 8,051,176 26/05/2015 7,265,436 4,913,528 &n....
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....1,596 3,246,246 237 Satabdi Ray and Santanu Bag T9-1106 7,552,563 26-May-15 5,337,703 3,818,840 238 Mr Iyer Raman Sankaranarayanan and Mrs Alka T5-1606 7,540,362 29-Jul-15 5,284,856 3,641,839 239 Durgeshnandini Das and Rohit Das T9-1706 7,515,569 05-Jan-15 5,223,725 3,958,967 240 Saurabh Biswas T10-1002 5,669,891 24-Feb-17 5,000,000 2,233,775 241 Pankaj Arora T11-704 5,890,103 03-Feb-15 4,123,738 3,096,307 242 Naveed Pasha Rasheed Anwar and Irhas Fatima T13-505 6,176,013 04-May-16 4,874,773 2,348,384 243 Preeti Rawat T9-905 5,258,525 29-Nov-14 4,633,670 3,334,072 244 Sharavan Murugan and Jincy Vallachira T7-603 6,630,920 02-Aug-14 5,797,333 4,360,479 245 Aman Chowdhary and Col B S Chowdhary T2-1202 3,873,070 20-Mar-15 2,509,235 1,838,153 246 Sanjit Kumar Bisoyee T11-905 5,337,698 21-Nov-14 ....
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....tor to comply with the orders of the RERA, the Corporate Debtor and IEPL are unable to comply with the same. (13) It is submitted that they have issued a notice dated 22.07.2019, in the capacity of Financial Creditors, through their Registered Association, demanding repayment of the aforesaid amounts. The Corporate Debtor and IEPL and the commons Directors have issued a vague, untenable and frivolous reply dated 08.08.2019, almost reneging on their commitments and obligations under the Agreements and not complying with the demand for making payment of the amounts paid by the Financial Creditors. All these amounts have been paid by them as early as 2014 - 2015, neither has the Amount earned its time value of money, nor has the same earned interest. The Corporate Debtor and IEPL have neither shown sufficient progress in the construction of the proposed Buildings nor have they handed over possession of the Apartments in terms of their commitments under the respective agreements. The list of other Financial Creditors/Home buyers in the very same project, who have approached the RERA and case are pending in RERA and Cases which are sent to the Deputy Commissioner for enforcemen....
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....unt of Rs. 50,79,697/-, the alleged liability would not fall under the definition of financial debt; he cannot be considered as Financial Creditor under provisions of the Code; there is a pre-existing dispute as the Petitioner has not filed appeal and they have not produced required documents etc. The Respondent has filed its Statement of Objections dated 4th December, 2019, by reiterating similar objections by denying contentions of Petitioner. Since the Respondent has not preferred an Appeal against the said order, it became final, and thus the Respondent has admittedly committed default for Rs. 50,79,697/- By perusal of the instant Petition, we are satisfied that the instant Petition/Application is complete as per law and default is not in dispute and eligible Resolution Professional was also suggested and thus it is a fit case to initiate CIRP against the Corporate Debtor. However, another Petition viz., C.P.(IB) No. 389/BB/2019 is filed by 255 Home Buyers against the same Corporate Debtor, we have examined this case as per merits, as detailed supra. 4. Heard Mr. Joshua H Samuel, learned Counsel for the Petitioners and Shri Prashantha Kumar, learned Counsel for the Respon....
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....and thus the case was taken by the Bench, and granted several opportunities to the Respondent either to resolve the issue in question between Parties or to file their statement of objections in order to avoid initiation of CIRP against them, which would result in devastating effect on the affairs of Company. However, they have not availed the opportunity. It is relevant to refer and extract the docket proceedings of case as below:27.11.2019: The learned Counsel for the Petitioner and the learned Counsel for the Respondent were present. The learned Counsel for the Respondent requests time for filing Statement of Objections. Therefore, the Adjudicating Authority has directed the learned Counsel for the Respondent to file Statement of Objections, duly serving the copy on the other side. 11.12.2019: On this day the learned Counsel for the Petitioner was present and none appeared for the Respondent. 02.01.2020: On this day, the learned Counsel for the Petitioner and the learned Counsel for the Respondent were present. The learned Counsel for the Respondent undertakes to file vakalath and requests time. Again, the Adjudicating Authority has directed the learned Counsel for the Respondent....
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....ght the Respondent is aware of instant Proceedings since 25th September, 2019 and the Petitioners after failing to get relief despite their best efforts, have failed to place their version of case by way of filing their Statement of Objection. In the circumstances, the Adjudicating Authority is bound to decide the matter as merits. The Respondent has not placed any material to show that they are concerned with the grievances of the Petitioners apart from other similarly situated Persons. 10. It is relevant to refer the judgment of Hon'ble Supreme Court in "Innoventive Industries Ltd. Vs. ICICI Bank and Anr. - (2018) 1 SCC 407", relevant portion of which is extracted below: - "27. The scheme of the Code is to ensure that when a default takes place, in the sense that a debt becomes due and is not paid, the insolvency resolution process begins. Default is defined in Section 3(12) in very wide terms as meaning non-payment of a debt once it becomes due and payable, which includes non-payment of even part thereof or an instalment amount. For the meaning of "debt", we have to go to Section 3(11), which in turn tells us that a debt means a liability of obligation in respect....
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.... the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the "debt", which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under subsection (7), the adjudicating authority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admission or rejection of such application, as the case may be." 11. The Skylark Ithaca Buyers Welfare Association (Petitioner herein) was registered with the District Registrar of Societies, Zone-3, Bangalore Urban Dist., dated 04.04.2019, they have also filed Memorandum of Society, Rules and Regulation of the Society. The Members of the Association have duly resolved in the meeting dated 20.07.2019 to initiate action/class action against the Developer Sk....
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....romises. You acts and conduct clearly establish that you had made promises/commitments, knowing fully well that they cannot be fulfilled/performed. Our Clients place on record that though under the terms of the Agreement, the flats were to be delivered by March, 2017, even as of April 2017 there was no progress in the Project, except of sketchy structures put up in part. After April 2017, work on the Project site had come to a complete standstill. However, on our Clients intervention and repeated visit to your offices and on site, you had under the guise of resuming work, in February, 2018 placed on site few laborers with no physical progress. We had thereafter noticed that even these laborers disappeared from the site from August 2018 and till date, the work at site has not commenced, though our Clients have complied with all their obligations and have paid all amounts." Therefore, they alternatively called upon the Respondent to comply with the following forthwith: "a) Repay the amount of Rs. 101,10,51,180/- received from our Clients in total or alternatively to each of them the sums mentioned in the tabular above that has been paid to you by our Clients; and ....
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....inancial Creditors" and are empowers to institute proceedings under the Insolvency and Bankruptcy Code 2016, as a Financial Creditor and seek for CIRP, the law is very clear that the homebuyer cannot insist on refund of the consideration amount already paid along with interest and other reliefs, before the date fixed for delivery of the possession and in this case the inordinate delay was caused by your clients by knocking to doors of the different forum just to tarnish the image of our clients Company and to hamper the construction business which is an abuse of the process of law. Moreover, to attract the provisions of the IBC Code, the homebuyers need to prove with cogent materials that the builder is at default and is willfully defaulting. Whereas in the present scenario our clients have made many correspondence with your clients to cooperate with our clients in completion of the Project but the intentions of your clients is to make unlawful gain in an unlawful manner. Our clients have sufficient means and resources to complete the Project and hand over the possession if your clients cooperate in this regard." 15. As stated supra, the Respondent, though chose not to file its ....
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....8,950 2015 Total Saleable Area 1,622,405 16. As stated supra, several aggrieved parties have approached Adjudicating Officer, RERA, Bengaluru, by filing several complaints. However, several of the Complaints have been disposed of by similar judgment dated 27.11.2018, by inter-alia stating as follows: "..2. After the issuance of summons the parties have appeared on 04.09.2018. The Respondent has fled the objection statement to the claim made by the Complainant. The main objection of the Developer is that the Complainant has failed to make the payment regularly. The agreement was signed on 05.09.2014 the Complainant has agreed to purchase the flat as per the agreement. In para no. 06 of the reply of the Complainant it is said that the Developer has failed to deliver the flat on or before September, 2017. It is also alleged that the construction was stopped and resumed only in the month of February 2018. Therefore, the Complainant has filed this Complaint seeking delay compensation but the developer says that the Complainant has committed delay in making payments. But I would say that there may be delay bu....
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....of interest payable by the promoter and the allottee: The rate of interest payable by the promoter to the allottee or by the allottee to the promoter, as the case may be shall be the State Bank of India highest marginal cost of lending rate plus two percent. Hence the complainant is entitled for delay compensation as per RERA commencing from October 2017 till the notice of possession is issued." 17. As stated supra, Mr. C. Srikrishna, another Petitioner, has filed C.P.(IB) No. 314/BB/2019) against the same Corporate Debtor, on the ground that it has committed default for amount of Rs. 50,79,697/- along with interest @ 10.75% p.a. He has also filed Complaint No. CMP/190102/0001817 before, the Adjudicating Officer, RERA, Bengaluru Karnataka and thus obtained judgment dated 23.05.2019, in his favor wherein the Respondent was directed to return the amount paid by the Complainant with interest. After issuing statutory Demand Notice dated 21.05.2019 under provisions of the Code, and receiving an un-tenable reply dated 24.05.2019, the above Petition was filed by seeking to initiate CIRP against the Corporate Debtor. After considering the merits of case, we are convinced that t....
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....ompany Petition, there is no other alternative for the Adjudicating Authority except to consider the case as per merits. 19. It is also relevant to point out here that we cannot keep the grievances of more than 250 Home buyers pending that too without any response coming from the Corporate Debtor to show any sort of solution for the issue raised in the instant Petition. As per law, even after initiating CIRP, it is permissible for the parties to settle the issue in question and can withdraw the Petition with permission of Adjudicating Authority, by filing appropriate Application. 20. As per the ratio laid down in Apex court judgment "Innoventive Industries Ltd. Vs. ICICI Bank and Anr. - (2018) 1 SCC 407, as stated supra, once debt and default in question is established to satisfaction of Adjudicating Authority, Application/Petition is filed in accordance with law and eligible Resolution Professional is suggested to appoint as IRP, an Application/Petition filed Under Section 7 of Code is to be admitted. In the instant case, as detailed supra, we are satisfied that debt and default in question are occurred and established being not controverted by the Respondent, and qualified ....