Home Case Index All Cases Insolvency and Bankruptcy Insolvency and Bankruptcy + AT Insolvency and Bankruptcy - 2023 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (1) TMI 812 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP with a malicious intent or not - grievance of the Appellant is that, the 1st Respondent / Bank had declared the account of the 2nd Respondent / Corporate Debtor as Fraud, without any cogent proof and later, lodged a complaint with the Enforcement Agencies, which was a violation of the Corporate Debtor’s basic rights, guaranteed under the Constitution of India - case making out for insolvency or not - HELD THAT:- It cannot be forgotten that an Application for initiation of Corporate Insolvency Resolution Process, was made on 19.08.2021, by the 1st Respondent / Bank, and the Date of Default, was 31.10.2018. As such, the Application, filed under Section 7 of the Code, by the 1st Respondent / Bank, before the Adjudicating Authority, is well within time and its Ex-facie, is maintainable in Law, as held by this Tribunal. In the instant case, the Corporate Debtor, had admitted the Debt and not disputed the same. Even the Appellant’s offer of Rs. 6 Crores, in respect of the dues of Rs.24 Crores, was not acceptable to the 1st Respondent / Bank, and the last letter for One Time Settlement, was made on 25.05.2021. It is not out of place for this Tribunal, to make a pertinent mention that the ability / inability of the Appellant, to settle his account(s), is not germane, in regard to the commencement of the Corporate Insolvency and Resolution Process proceedings. Because of the latent and patent fact, that the I & B Code, 2016, is for Resolution, and not a ‘Recovery Mechanism, in the earnest opinion of this Tribunal - It cannot be gainsaid that Classification of an Account as Fraud, by the 1st Respondent / Financial Creditor / Bank, does not hinder the Bank, from considering the OTS Proposal, and the Offer of Rs.6 Crores, as against the due of Rs.24 Crores, was not acceptable to the 1st Respondent / Financial Creditor / Bank. Although, a Notice, was issued to the Appellant, to improve his Offer, the Appellant, had not availed the same. As for as the present case is concerned, the Corporate Debtor, had not disputed the Debt, but admitted the same. There is no Dispute, in regard to the grant of Term Loan Facilities or about the Corporate Debtor, being in Default - The amount of Debt, given to the Corporate Debtor was Rs.23,21,89,000/- and that a Sum of Rs.31,17,20,210.16 was the amount in Default, as on 19.08.2021. - The Default occurred when the Account of the Corporate Debtor, was classified as Non Performing Asset, on 31.10.2018. Keeping in mind of the fact that the Financial Debt and Default of the Corporate Debtor, were established by the 1st Respondent / Financial Creditor / Bank, based on the facts and circumstances of the instant case which float on the surface, on going through the the impugned order dated 09.06.2022, passed by the Adjudicating Authority, (National Company Law Tribunal, Division Bench – I, Chennai) in CP(IB)/203(CHE)/2021 (Filed by the 1st Respondent / Petitioner / Financial Creditor), under Section 7 of the I & B Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, comes to a consequent conclusion that the Adjudicating Authority (Tribunal), had rightly exercised its subjective discretion in a right thinking and sound manner, in admitting the Application in CP(IB)/203(CHE)/2021, which is free from any Legal Errors. Accordingly, the instant Appeal fails. Appeal dismissed.
|