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2021 (1) TMI 717 - AT - Insolvency and BankruptcyMaintainability of application - iitiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - Financial Debt or not - HELD THAT:- It appears that it is registered as a Non-Banking Financial Institution but is not authorised to accept public deposits. The alleged inter-corporate loan for a short period of 90 days repayable with a 15% per annum cannot be treated as a public deposit. Therefore, the objection of the Corporate Debtor in this regard is without any basis - the Corporate Debtor admits that up to 26th November 2018 he has paid only ₹ 2,69,075/ against the loan of ₹ 25 lacs, which was to be repaid with 15% interest per annum, within 90 days from the date of disbursal of loan. But the Corporate Debtor defaulted in repaying the amount. Therefore, it remains undisputed that the Corporate Debtor owes more than ₹ 1 lacs and committed default in repaying the same. Thus, it is clear that when a default takes place, and debt becomes due and is not paid, the Insolvency Resolution Process begins. Non-payment of debt, once it becomes due and payable, is considered a default under Section 3(12) of the Code. It is further held that the Adjudicating Authority is satisfied that default occurs, the Application must be admitted unless it is incomplete. In the instant case, the amount of ₹ 25 lacs was given as inter-corporate loan to the Corporate Debtor for 90 days which was repayable with interest @ 15% per annum. It is also clear that the Corporate Debtor has not paid the amount due and more than ₹ 1 lac. The Application is complete. Therefore, the Adjudicating Authority was justified in admitting the petition. Appeal dismissed.
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