Home Case Index All Cases Insolvency and Bankruptcy Insolvency and Bankruptcy + AT Insolvency and Bankruptcy - 2021 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (7) TMI 1091 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - quantum of outstanding amount - HELD THAT:- In this case it is observed that there is no confirmation of counter claim of corporate debtor from operational creditor, even in the reply to the demand notice, it was unsupported by the invoices, delivery challans and GST payments. Truck Number - one of the consignment number is not correct and all the invoices and deliveries are of one day. Simply making GST payment cannot prove that they have supplied the material to the other side. The Corporate Debtor has never raised that they have due recoverable from the operational creditor prior to the issue of the reply to the demand notice. Rule 46 of CGST Rules, R/w Rule 48 of CGST Rules permits manual GSTIN Number. For the issues is that the Corporate Debtor invoiced is not supported by the purchase order nor a confirmation of account at a later date from the operational creditor. The Corporate Debtor is a healthy company, not substantiated by the corresponding balance sheet of the company as they have not filed the same nor alone this cannot be a sole basis to substantiate that it does not require to go to CIRP. High turnover with positive net worth may reflect good fund flow but it does not substantiate a good cash flow - thus, if the corporate debtor is unable to pay its debt, while debt is legally due and default has occurred, dispute not raised or substantiated prior to the issue of demand notice then the Code can be enforced for timely resolution of Insolvency and Bankruptcy. Thus, prima facie the Corporate Debtor needs CIRP and accordingly, the impugned order of the Adjudicating Authority invoking the provisions of the Code is in right spirit. Hence it needs to be uphold - the appeal is dismissed
|