2020 (1) TMI 1078 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate debtor failed to make repayment of its debt - existence of debt and default or not - HELD THAT - There is no doubt that there was supply of services by the Operational Creditor in favour of the Corporate Debtor and also that a sum of Rs. 14, 73, 005/- is due and payable in this regard - The application made by the Operational Creditor is complete in all respects as required by law. It clearly shows that the Corporate Debtor is in default of a debt due and payable and the default is in excess of minimum amount of one lakh rupees stipulated under section 4(1) of the IBC. Therefore the default stands established and there is no reason to deny the admission of the Petition - In view of this this Adjudicating Authority admits this Petition and orders initiation of CIRP against the Corporate Debtor. Petition admitted - moratorium declared.

Summary

Issues:
Company Petition under section 9 of the Insolvency & Bankruptcy Code, 2016 (IBC) seeking initiation of Corporate Insolvency Resolution Process (CIRP) against a private company for non-payment of dues.

Detailed Analysis:

1. Jurisdiction and Background:
The Company Petition was filed by an Operational Creditor against a private limited company under the IBC. The Corporate Debtor failed to make payment of a specified sum, leading to the petition. The Corporate Debtor was incorporated under the Companies Act, 1956, with jurisdiction falling under the Mumbai Registrar of Companies.

2. Debt and Default:
The Operational Creditor provided services to the Corporate Debtor, resulting in an outstanding debt of Rs. 14,73,005.00. The petition was based on the default in payment by the Corporate Debtor as of the specified date.

3. Legal Compliance:
The Operational Creditor followed due process by serving a Demand Notice to the Corporate Debtor in accordance with section 8 of the IBC. Despite multiple opportunities and notices, the Corporate Debtor did not respond or appear in the proceedings.

4. Evidence of Debt:
The petition included invoices, purchase orders, and ledger statements confirming the debt owed by the Corporate Debtor to the Operational Creditor. The Corporate Debtor's acknowledgment of the invoices and ledger statement further solidified the claim.

5. Admission of Petition:
After reviewing the evidence and compliance with legal requirements, the Adjudicating Authority found the petition to be complete and established the default in payment. Consequently, the petition was admitted, and the CIRP against the Corporate Debtor was initiated.

6. Operational Procedures:
The order included provisions for a moratorium under section 14 of the IBC, appointment of an Interim Resolution Professional (IRP), public announcement of CIRP, and directions for management and compliance during the CIRP period. The Operational Creditor was directed to deposit a specified sum with the IRP for expenses.

7. Compliance and Communication:
Instructions were given for communication of the order to the concerned parties, appointment of IRP, updating of records with the Registrar of Companies, and compliance reporting within specified timelines.

This detailed analysis covers the key aspects of the judgment, including legal compliance, evidence, admission of the petition, operational procedures, and compliance requirements post-admission of the CIRP.