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Insolvency and Bankruptcy - Case Laws
Showing 161 to 178 of 178 Records
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2022 (9) TMI 138
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- On perusal of record, it can be seen that the date of default has not been mentioned in the petition. According to section 3(11) of the Code, a “debt” means a liability or obligation in respect of a claim which is due from any person and includes a financial debt and operational debt. Further, according to section 3(12), “default” means non-payment of debt when whole or any part or instalment of the amount of debt has become due and payable and is not paid by the Corporate Debtor. Therefore, in order to determine the date on which the cause of action arose, and the date from which the limitation would ensue, it is crucial to determine the date of default.
In the instant matter, no date of default has been mentioned in the Form 5 of the petition. Further, the brief synopsis provided in the petition mentions that the last payment was made on 04.11.2016. in the absence of the date of default, the date of cause of action cannot be determined.
Since the MOU has been used to establish the basis of the financial relation with the Corporate Debtor, the same cannot be used to support the claims of the petitioners who are not parties to the MOU. The Financial Creditors’ contention that the other financial creditors gave the money to the Corporate Debtor on behest of the said MOU, and at the request of Shri Shyam Sundar Poddar and Shri Sital Kumar Poddar, is untenable in absence of any document supporting the same - As an evidence of the same, the Corporate Debtor has provided the payment details which show that amounts equal to the principal sums lent by the Financial Creditors being Impex India Inc., S.K. Engineering, SRMB Ionic International, Bimal Jajodia, Deepti Poddar, Nirmala Poddar, Manju Lohia and Shyam Sundar Poddar (HUF) have been transferred by the Corporate Debtor.
The Financial Creditors, in order to establish default of re-payment on part of the Corporate Debtor, have mentioned about various dishonoured cheques. All the cheques have been dated 02.09.2019 and are signed by Rajib Guha and Aloke Kumar Banerjee i.e directors of the Corporate Debtor - The issue of the validity and genuineness of the cheques, which are pivotal to establish default of the Corporate Debtor, can only be done in appropriate proceedings by leading evidence and not in summary proceedings under the Code.
This Adjudicating Authority, therefore, is not satisfied that default on part of the Corporate Debtor is established. Further, in absence of an explicit date of default in the petition, the same is incomplete. As such, the instant petition is liable to be rejected.
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2022 (9) TMI 137
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- The Financial Creditor has satisfactorily established the existence of debt of Rs. 15,00,000/- and default of the outstanding dues aggregating to Rs. 17,84,219/- as evidenced by the records of the Financial Statements attached to this Petition. The date of default is 16th January 2017 and this Petition was filed on 8th November 2019 therefore it is noted that the Petition is not barred by Limitation.
The Financial Creditor has thus successfully demonstrated and proved the debt and default in this case. Therefore, this Bench is of the view that that this Petition satisfies all the necessary requirements for admission under Section 7 of the Code.
Petition admitted - moratorium declared.
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2022 (9) TMI 136
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - whether the Petition under section 7 of the Code is barred by limitation or not? - HELD THAT:- Upon perusal of the record it is apparent that transaction between the parties was purely financial in nature and there is an existence of Financial Debt. From the above records it is apparent that the Financial Creditor under SARAL KARJ BHUGTAN YOJNA extended One Time Settlement offer to the Corporate Debtor and the same was accepted by the Corporate Debtor - Balance sheet for year ending as on 2017 - 2018 of the Corporate debtor reflects that Corporate Debtor has certain short term borrowings which is showing that there exists cash credit facilities from the Bank. Further, as per the Auditors’ Report of the Corporate Debtor for financial year ending as on 2017 – 2018 (page 104 of the Supplementary Affidavit), it states that the Corporate Debtor has defaulted in the repayment of loans or borrowings to financial institutions, banks.
The present petition filed by the Financial Creditor is complete in all respects as required by law. The Petition establishes that the Corporate Debtor is in default of a debt due and payable and that the default is more than the minimum amount stipulated under section 4 (1) of the Code, stipulated at the relevant point of time.
Petition admitted - moratorium declared.
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2022 (9) TMI 135
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- On having seen the loan disbursement and documents supporting agreement between the parties conferring obligation upon the Corporate Debtor to repay the Loan amount including interest, this Financial Creditor has proved existence of debt and default. Moreover, the Corporate Debtor has admitted the debt in its own reply. The present petition was filed on 28.12.2021 and the Corporate Debtor was having enough time to settle the outstanding amounts of the Financial Creditor, but the Corporate Debtor failed to do so.
Under the said circumstances, since the debt and default on the part of the Corporate Debtor is being proved and also by looking at the consent given by the Insolvency Professional, the application is admitted.
The application is admitted - moratorium declared.
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2022 (9) TMI 134
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - NPA - Financial Creditors - existence of debt and dispute or not - whether the Petition under section 7 of the Code is barred by limitation or not? - HELD THAT:- Upon perusal of the record it is apparent that transaction between the parties was purely financial in nature and there is an existence of Financial Debt. From the above records it is apparent that from time to time the Financial Coeditor under SARAL KARJ BHUGTAN YOJNA extended One Time Settlement offer to the Corporate Debtor and the OTS was accepted by the Corporate Debtor - it is evident that the Corporate Debtor is still acknowledging the debt due to the financial creditor being the Financial Creditor in the instant case.
It is seen from the record that the date of default has been mentioned as 30 June, 2011, which stood revived with the acceptance of the OTS proposal by the Corporate Debtor on 28 December, 2018. Moreover, upon perusal of the records at page 231 and 232 of the Petition, it is apparent that the Corporate Debtor also made part payment of the OTS proposed amount. Further, the settlement proposal under the SARAL KARJ BHUGTAN YOJNA provided for the payment of the balance amount within 31 March, 2019.
The Petition establishes that the Corporate Debtor is in default of a debt due and payable and that the default is more than the minimum amount stipulated under section 4 (1) of the Code, stipulated at the relevant point of time - the present petition filed by the Financial Creditor is complete in all respects as required by law - Petition admitted - moratorium declared.
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2022 (9) TMI 133
Seeking directions of this Tribunal to take action against the Respondent Company, the Creditor - wilful and false disclosure and concealment of facts in Claim Form-C in an attempt to be considered as a Financial Creditor and be a member of the Committee of Creditors - Power of Resolution Professional to suo moto review, modify or vary the claim of a creditor once the same has been admitted/verified by IRP/RP - Section 235A of IBC, 2016 - whether Applicant as a member of the COC is adjudicatory in nature or otherwise and whether it amounts to review of his decision? - related party of the Corporate Debtor or not.
HELD THAT:- The duties of IRP have been enumerated under Section 18 and duties of the RP have been enumerated under Section 25 of the Code, under which, the IRP and RP are duty bound to perform their duties as envisaged under the said provisions. Further, the IRP/RP are also guided by the CIRP Regulations while verifying the claims and determining the amount of such claims. The relevant provisions which come into play are Regulations 10, 12, 13 & 14 of the CIRP Regulations - It is noticed that the RP sought clarification from the Applicant vide e-Mail dated 24.11.2021 after receiving information/documents from Punjab National Bank, to which, the Applicant did not reply. Therefore, the RP in discharge of his duties as stipulated under the Act as well as in the Regulations updated the claim on the basis of documents received by him and re-designated the Applicant from Financial Creditor to Financial Creditor - Related party.
The action of the RP in issuing e-Mail dated 29.11.2021 cannot said to be the adjudicatory in nature and it is in fact administrative in nature - the RP has acted well within his limits and took into consideration the material placed before him subsequently by Punjab National Bank which is supported by State Bank of India as well as by the promoters of corporate debtor.
Whether the Applicant can be held to be a related party of the Corporate Debtor in the facts & circumstances of the present case? - HELD THAT:- It is seen that both the parties will have share on profits and furthermore the brokerage will be shared by them. It is thus clear that there is a nexus between the Applicant and the Corporate Debtor and its prima-facie establishes that the Applicant is a related party of the Corporate Debtor - there are no hesitation to hold that the Applicant is a related party to the Corporate Debtor in terms of Section 5(24)(i) of the IBC.
Application dismissed.
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2022 (9) TMI 109
Modification/alteration of approved Resolution Plan - Resolution Plan is submitted to Resolution Professional claiming right to use brands and Trademarks, approved by CoC and Adjudicating Authority - declaration that the Corporate Debtor is the owner of Trademarks - alteration or modification of Resolution Plan approved by CoC is valid or not - Whether declaration of ownership over Trademarks after approval of Resolution Plan by CoC, which is not a part of Resolution Plan amount to modification or alteration of approved resolution Plan by CoC, if so, the order is liable to be set aside? - HELD THAT:- Since the Resolution Plan satisfied the legal requirements, it was approved by CoC in its commercial wisdom and also approved by Adjudicating Authority subject to rider. The Resolution Professional filed IA No. 155/2018 claiming ownership on the brands “Deccan Chronicle” and “Andhra Bhoomi” during pendency of petition under Section 31 of IBC, but the IA No. 155/2018 was allowed by Adjudicating Authority. If for any reason the CoC decision i.e. approval is against any law, the course open to the Adjudicating Authority is to return the Plan for fresh consideration and approval - The role of Resolution professional is only a facilitator, cannot act either as Creditors or Corporate Debtor or Adjudicating Authority but the Resolution Professional has filed the I.A. No. 155/2018, may be to protect the interest of CoC for maximization of value of assets of Corporate Debtor.
Right to use is distinct from right and title to incorporeal property, right to use is only licence but title creates ownership, which is superior right. Hence creation of superior right in incorporeal property i.e., Trademarks tantamount to alteration or modification of approved Plan by CoC in its commercial wisdom, though conditional and such conditional approval by Adjudicating Authority is contrary to law.
There are no hesitation to conclude that right or ownership, if any, claimed after approval of Resolution Plan by CoC is extinguished and if ownership of Corporate Debtor is declared over the Trademarks, it would amount to modification or alteration of approved Resolution Plan by CoC which is impermissible. Hence the order of Adjudicating Authority to the extent of declaring the ownership of Corporate Debtor over the Trademarks “Deccan Chronicle” and “Andhra Bhoomi” is illegal and the Adjudicating Authority transgressed the jurisdictional limits.
This point is held in favour the Appellant and against the Respondents.
Whether the Adjudicating Authority under IBC is vested with jurisdiction to decide title or right or ownership over Trademarks, when jurisdiction is conferred on District Judge as per the provisions of Trademarks Act, if not the order passed is liable to be set aside? - HELD THAT:- Since this point relates to jurisdiction of Adjudicating Authority to decide the ownership of Trademarks, no finding need be recorded in view of the above point, while leaving it open to the parties to approach appropriate authority or Tribunal at appropriate time, whenever need arises.
Appeal allowed.
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2022 (9) TMI 21
Distribution of liquidation proceedings - distribution of amount less any applicable withholding tax out of accumulated cash profit lying with the Bank in the account of corporate debtor to the stakeholders - waterfall mechanism as specified under Section 53 of the IBC - HELD THAT:- Once the order impugned had already taken its finality there was no reason to advance further arguments. Even though learned counsel for the appellants were conveyed regarding the present situation, learned counsel for the appellants insisted to pursue the Court. It is noticed that without any plausible reason during arguments false allegations were made against Respondent No.1/liquidator on the point of facts relating to pendency of two appeals before this Appellate Tribunal.
The fact regarding pendency of the appeal before this Appellate Tribunal was brought on record by the liquidator by way of filing rejoinder/reply affidavit before the Adjudicating Authority as it is apparent from Volume I and Volume II. The reply filed by the Respondent No.1 was already served on the appellants even then learned counsel for the appellants have ventured to make allegations against Respondent No.1 regarding suppression of fact of pendency of appeal before this Appellate Tribunal.
Section 61 of IBC in a specific term contemplates filing of appeal by an aggrieved person. It was not a stage of corporate insolvency proceeding. After CIRP since it failed, liquidation order was passed by the Adjudicating Authority on an application filed by the Liquidator under Section 33(1) of the IBC. Once corporate debtor went into liquidation and the petition for distribution of accumulated profit was filed wherein representatives of employees as well as representatives of shareholders were arrayed as party there was no reason for third person to file the present appeal.
Distribution of sale proceeds as contemplated under Section 53 IBC as well as Regulation 32 and 42 of Regulation 2016 - HELD THAT:- In the present case there was accumulation of profit in the account of corporate debtor regarding which account as per Regulation 41 in the account of corporate debtor the word “liquidation is to be added” being custodian of the said account. Being custodian of the said account it was duty on the part of the Liquidator to immediately distribute accumulated profit lying in the said account.
Had it been not done by the liquidator after noticing accumulation of huge accumulated profit amounting to the tune of Rs.96 crores, question would have raised as to why the said amount was lying in the bank account. In such situation in all fairness it would be the duty on the part of the liquidator to take immediate steps to distribute the accumulated profit in terms of Section 53 of the Act under the waterfall mechanism - there are no error or default in liquidator for approaching the Adjudicating Authority regarding distribution of accumulated profit.
The appeals are devoid of merits and require to be rejected with imposition of heavy cost - Appeal dismissed.
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2022 (9) TMI 20
CIRP proceedings - Financial Creditors - Non performing assets - applicability of time limitation - guarantee given as Managing Director/ Director of CD shall be treated as personal guarantee or not - on failure of settlement agreement, the FC need to go to DRT or can directly approach Hon’ble Adjudicating Authority for enforcing claims of FC against CD as well as personal guarantor - demand of interest.
Whether, debt was due and default took placed? - HELD THAT:- Various term loan and working capital facilities were given by SBT & SBBJ which later merged into SBI (FC). This fact was never disputed by Appellant. It is also noted that subsequent to FC’s claim under SARFAESI Act and later before Hon’ble DRT, CD proposed compromise settlement which also clearly stipulated about existence and acceptance of debt in terms of both principal as well as interest.
Therefore, there was clear financial debt which was due and not paid and Adjudicating Authority has, therefore, rightly admitted Application under Section 95(1) of the IBC.
Whether the present application filed under Section 95(1) of the IBC is barred by law of limitation? - HELD THAT:- The final order was passed by Hon’ble DRT on 20.09.2019 and the last payment of Rs. 5 crore was made by CD on 31.12.2019, whereas, the Application under Section 95(1) filed before Hon’ble Adjudicating Authority on 03.11.2021. Considering the Hon’ble Supreme Court Suo Moto Writ Petition IN RE: COGNIZANCE FOR EXTENSION OF LIMITATION [2021 (3) TMI 497 - SC ORDER] excluding period of limitation from 15.03.2020 to 28.02.2022 the present application was filed within 74 days from the last payment of 31.12.2019.
Thus, it is clear that the Application u/s 95(1) was filed within Limitation Period and we therefore, there are no error in the Judgment of Adjudicating Authority on this point.
Whether guarantee given as Managing Director/ Director of CD shall be treated as personal guarantee or otherwise? - HELD THAT:- Section 2 of IBC described the Applications of IBC Code. Section 2(e) of the IBC which case in force w.e.f. 01.12.2019 in so far as they relate to Personal Guarantor to Corporate Debtor. The new section 2(e) came vide notification dated 15.11.2019. The notification also enforced certain other provisions, namely, Section 78, 79 & 94 to 187 (Part III) which provide for Insolvency & Bankruptcy of Individual and also Section 239 (Power to make rules), Section 240 (Power to make regulations) and Section 249 (Part V) in so far as they relate to PGCD - With these amendments through the amended Section 2(e) pertaining to PGCD, it was made possible to subject PGCD to Insolvency Proceedings before same Adjudication Authority (NCLT)/ Appellate Authority (NCLAT) who decides matter related to CD. Thus, if the CD’s debt remains unpaid, the personal guarantor would not stand discharged but would himself be forced to face bankruptcy proceedings before the Adjudicating Authority - thus, there are no error in this regard.
Whether, on failure of settlement agreement, the FC need to go to DRT or can directly approach Hon’ble Adjudicating Authority for enforcing claims of FC against CD as well as personal guarantor? - HELD THAT:- There was no requirement to approach the Hon’ble DRT for getting Recovery Certificate before approaching the Adjudicating Authority - there are no merit in the contention of the Appellant on this issue.
Whether, the provision of interest by Adjudicating Authority was incorrect and contrary to DRT final order? - HELD THAT:- In any commercial loan, time value is very important. The definition of `financial debt’ as provided in Section 5(8) of IBC mentioned herein above. It makes clear that `Financial Debt’ along with interest against consideration for the time value of money is required.
This Tribunal is of the considered view that no ground is made out for any interference by this Tribunal with the impugned order - Appeal dismissed.
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2022 (9) TMI 19
Seeking directions against the Resolution Professional of Corporate Debtor, for admitting his claim in the Resolution Plan and to be treated as secured Financial Creditor - seeking condonation of 60 days delay in filing this Appeal - Appellant has shown due diligence in submitting the claim before the IRP/Resolution Professional or not - admitting the claim at a time when the Resolution Plan has already been approved by the CoC and is pending consideration of the Adjudicating Authority - Tripartite Agreement between the Appellant, Corporate Debtor and the borrowers/Homebuyers.
HELD THAT:- Since the Resolution Plan has not only been accepted by the CoC but also placed before the Adjudicating Authority for approval, accepting any belated claim at this stage, will put paid to the efforts achieved so far by the Resolution Professional in completion of CIRP process. In IBC, where time-lines are well laid down, any indulgence shown by way of belated admittance of claim is likely to jeopardise the CIRP and set the clock back which certainly is not the intent and purpose of the IBC.
Whether the Tripartite Agreement between the Appellant, Corporate Debtor and the borrowers/Homebuyers which has been validated by the Hon’ble DRT by issue of DRCs provides enforceable rights in favour of the Appellant Bank? - HELD THAT:- There is a need to take a close look at the terms of the Tripartite Agreement whereby the Appellant Bank sanctioned and released housing loans to some allottees /Homebuyers for purchase of flats in the project floated by the Corporate Debtors.
There are substance in the contention of the Learned Counsel for the Respondent that mere permission to mortgage is of no relevance in the absence of not having registered a charge. Furthermore, we also agree that being merely in possession of enforceable rights under Tripartite Agreement is not enough. The claimant was required to act upon those rights and establish the claim before the Resolution Professional which having not been done, nothing remains in respect of the undecided claim.
The Adjudicating Authority has committed no error in passing the Impugned Order. We find no cogent reason to interfere with the Impugned Order - The appeal is dismissed.
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2022 (9) TMI 18
Initiation of CIRP - barred by time limitation or not - SIC company - pre-existing dispute or not - NCLT admitted the application - HELD THAT:- The law is now well settled that the limitation for filing an application either under Section 7 or 9 of the Code is three years in view of Article 137 of the Limitation Act, 1961 which has to be seen from the date of default.
There is no dispute that the Appellant was referred to as a Sick unit by BIFR on 09.11.2005 and the embargo of Section 22 of the SICA was lifted with the repeal of SICA w.e.f. 01.12.2016 - The right to apply under Section 9 of the Code accrued to the Respondent after SICA Act was repealed on 01.12.2016 and also when the Insolvency and Bankruptcy Code, 2016 came into force - the application filed under Section 9 of the Code by the Respondent is well within the period of three years and as such the application is not barred by limitation.
Pre-existing dispute or not - HELD THAT:- The Respondent has submitted that the issue regarding the pre-existing dispute is concocted by the Appellant because no evidence is brought on record to show that there has ever been any effort by the Appellant either by filing any suit or any proceedings in respect of quality of the goods. It is further submitted that the Appellant, in the written submissions filed before the Adjudicating Authority has made bald averments of making request several time to the Respondent to take back the material which has not been accepted by the IOCL, without giving any particular date of the said instance. Therefore, the objection raised by the Appellant about the pre-existing dispute is just for the sake of an objection otherwise it has no legs to stand.
Appeal dismissed.
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2022 (9) TMI 17
Initiation of CIRP - NCLT admitted the application ex-parte - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - service of demand notice - HELD THAT:- It is also pertinent to mention here that though the Appellant had a remedy to file the application before the Tribunal for recalling of the admission order dated 12.01.2022 but again for the reasons best known to it no such application was filed rather the present appeal has been filed in which the issue of pre-existing dispute which is purely an issue of fact has been raised.
Applicable Threshold limit - the threshold was Rs. 1 lac and during the pendency of the application the threshold is changed Rs. 1 lac to 1 Crore - HELD THAT:- the decision rendered in the case of Madhusudan Tantia [2020 (10) TMI 547 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] by this Tribunal is directly on the issue wherein it was held that, "if the notification dated 24.03.2020 of the Ministry of Corporate Affairs, Government of India, is made applicable to the pending applications of IBC (filed earlier to the notification in issue) it will create absurd results of wider implications / complications."
Pre-existing dispute or not - HELD THAT:- There is no evidence brought on record by the Appellant in this regard, except for referring to invoices relied upon by the Operational Creditor to contend that those invoices pertains to a new company i.e. Rajprotim Supply Chain Solutions Pvt. Ltd. In this regard, we would hasten to add that by virtue of an agreement dated 21.12.2016, the entire business of the Appellant was transferred to the new company i.e. Rajprotim Supply Chain Solutions Pvt. Ltd. and the Appellant had been paying the dues/debts of the Operational Creditor till December, 2017 and then stopped the same. As a result thereof, the Operational Creditor had to initiate the proceedings. No other point has been raised.
There are no merit in this appeal and the same is hereby dismissed though without any order as to costs.
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2022 (9) TMI 16
Seeking approval of the Resolution Plan - Section 30(6) read with Section 31 of the Insolvency & Bankruptcy Code, 2016, read with Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 - HELD THAT:- In view of Section 31 of the Code, the Adjudicating Authority, before approving the Resolution Plan, is required to examine that a Resolution Plan which is approved by the CoC under Section 30(4) of the Code meets the requirements as referred under Section 30(2) of the Code.
From the averments made in the Application as well as in Form-H as filed by the Resolution Professional in relation to the procedural aspects, the same seems to have been duly complied with for which the applicant has issued a certificate and it is not necessary for this Tribunal to go into the same. However, this Tribunal is duty bound to examine the Resolution Plan vis-à-vis with the mandatory compliance under the Code and the compliance made under is captured hereunder - all the requirements of Section 30(2) are fulfilled. In respect of compliances regarding CIRP Regulations especially Regulations 38 and 39, the Resolution Professional has certified in Form-H and explained in details that the Resolution Plan has complied with all the required Regulations.
The Resolution Plan fulfils the requirement as referred in Section 30(2) of the Code and there are sufficient provisions in the Plan for its effective implementation as required under the proviso of Section 31 (1) of the Code. The Resolution Plan has been unanimously approved by CoC - there is no impediment in giving approval to the Resolution Plan.
The Resolution Plan is approved - application allowed.
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2022 (9) TMI 15
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors/allottees under a real estate project - transfer of corpus funds into the loan account - Financial Debt or not - existence of debt and dispute or not - HELD THAT:- As per the facts in the present matter, it is clearly established that the Financial Creditors are the allottees under a real estate project and thus reference needs to be made to Section 7 of the Code - For the want of fulfilment of the criteria set by the Insolvency and Bankruptcy Code, 2016 in matter of Real Estate projects, this Petition cannot be allowed as it is filed only by a single allottee and cannot be considered as per the provision laid down in Section 7(1) of the Code. Under the Code, a minimum of 100 people or 10% of the total allotee must be there to initiate a proceeding in IB Code.
There are no material to conclude that the Financial Creditors amount to minimum 10 percent. Accordingly, the Financial Creditors are not eligible to file a Petition before this forum.
The present transaction was in pursuance of the sale agreement. There was no other agreement formed between the parties for amount claimed in default/amount transferred towards corpus fund, hence the given transaction of transfer of corpus funds into the loan account would not qualify as a financial debt as per the definition laid down in Section 5(8) - Applicant failed to qualify the threshold prescribed in the proviso laid down under section 7 (1). Therefore, this Petition is liable to be rejected.
Petition dismissed.
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2022 (9) TMI 14
Recovery of dues of Financial Creditors - whether the amounts of financial creditors will be recovered either on the culmination of CIRP into approval of the Resolution Plan or Liquidation of the assets of the Corporate Debtor are yet to be ascertained and in the absence of which, the amount recoverable from the Respondent herein, if any, cannot be crystallized - surety to secure the credit facilities sanctioned by the members of the consortium to Corporate Debtor - production of vouchers and other supporting documents in support of the alleged debit entries and other alleged transactions contained in the statements of accounts.
HELD THAT:- There is no provision in the Code which bars the initiation of Insolvency Resolution Process against the Personal Guarantor until the debt amount which is to be recovered from the Corporate Debtor gets crystallized. Further it is a well settled principle that the liability of surety in the Contract of Guarantee is co- extensive with that of Principal Borrower.
Other contention raised by the Personal Guarantor is that the Respondent/Personal Guarantor was coerced into signing the Personal Guarantee agreement - HELD THAT:- The Law of Contract is very clear with respect to voidable contract that when consent to an agreement is caused by coercion, the agreement which is a contract is voidable at the option of the party whose consent was so caused. Meaning thereby that unless proved otherwise the said agreement would be valid and enforceable and since no action was taken to make the contract void it will remain valid and enforceable as per law.
Production of vouchers and other supporting documents in support of the alleged debit entries - HELD THAT:- It is pertinent to mention here that the Applicant has registered the debt with the Information Utility i.e. NESL and the copy of the same is also annexed with the application filed by the Financial Creditor. Further, section 99(3) of the IBC, 2016 states that when the debt is registered with the information utility the debtor shall not be entitled to raise dispute to the validity of such debt. Hence, this contention of the Respondent is also not sustainable.
After going through all the documents on record the Petition filed under the provisions of Section 95 of IBC, 2016, is hereby admitted under section 100 of the IBC, 2016 - Petition admitted - moratorium declared.
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2022 (9) TMI 13
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - services in relation to the freight forwarding of Air Export/Air Import consignment to the corporate debtor - existence of debt and dispute or not - HELD THAT:- It is seen that the applicant is part of group company and offering individual solutions for transportations and logistic to the corporate debtor since the year 2007. Since then, the corporate debtor was paying the invoice payments to applicant, but after 17.09.2016 the corporate debtor has committed default in making payments of invoices due to be payable. Pursuant to which, the applicant made several oral and written request to make payment for the unpaid dues. Though, the corporate debtor never raised any dispute nor any objection with regards to the to the quality of services provided by corporate debtor.
Relatively, the corporate debtor has made part payments towards running ledger of the goods supplied by the operational creditor. This leaves no doubt that the default has occurred for the payment of the unpaid operational debt to the applicant. It is reiterated that despite service of demand notice and notices by this court no objection has been raised by corporate debtor. The corporate debtor has chose to remain absent - since no objection has ever been raised by corporate debtor, it can be concluded that the applicant has established its claim which is due and payable by the corporate debtor. The present application is admitted.
Petition admitted - moratorium declared.
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2022 (9) TMI 12
CIRP process - recovery of debt from Corporate Debtor - whether the financial creditors will recover either the dues on the culmination of CIRP into approval of the Resolution Plan or Liquidation of the assets of the Corporate Debtor are yet to be ascertained and in the absence of which, the amount recoverable from the Respondent herein, if any, cannot be crystallized? - HELD THAT:- There is no provision in the Code which bars the initiation of Insolvency Resolution Process against the Personal Guarantor until the debt amount which is to be recovered from the Corporate Debtor gets crystallized. Further it is a well settled principle that the liability of surety in the Contract of Guarantee is co- extensive with that of Principal Borrower.
Whether the Respondent was coerced to stand as surety to secure the credit facilities sanctioned by the members of the consortium to Corporate Debtor? - HELD THAT:- The Law of Contract is very clear with respect to voidable contract that when consent to an agreement is caused by coercion, the agreement which is a contract is voidable at the option of the party whose consent was so caused. Meaning thereby that unless proved otherwise the said agreement would be valid and enforceable and since no action was taken to make the contract void it will remain valid and enforceable as per law.
Whether the Applicant has not placed on record the vouchers and other supporting documents in support of the alleged debit entries and other alleged transactions contained in the statements of accounts? - HELD THAT:- It is pertinent to mention here that the Applicant has registered the debt with the Information Utility i.e. NESL and the copy of the same is also annexed with the application filed by the Financial Creditor. Further, section 99(3) of the IBC, 2016 states that when the debt is registered with the information utility the debtor shall not be entitled to raise dispute to the validity of such debt. Hence, this contention of the Respondent is also not sustainable.
After going through all the documents on record, the Petition filed under the provisions of Section 95 of IBC, 2016, is hereby admitted under section 100 of the IBC, 2016 - Petition admitted - moratorium declared.
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2022 (9) TMI 11
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- It is now well settled that the period of limitation for an Application seeking initiation of the CIRP under Section 9 of the Code is governed by Article 137 of the Limitation Act and is, therefore 3 years from the date when the 'Right to Apply' accrues i.e., failure to clear the dues.
As the debt has been duly acknowledged by the Corporate Debtor on 16.03.2017, accordingly, the limitation period will be reckoned from 16.03.2017. Thus the present Application which has been filed within three years from 16.03.2017 as prescribed in Article 137 of the Limitation Act successfully survives the bar of Limitation.
Threshold limit for filing application - HELD THAT:- In order to initiate the CIRP against a Corporate Debtor on an Application filed by the Operational Creditor before 24.03.2020, it must primarily qualify the threshold limit of Rs. 1 lakh. It is pertinent to mention here that the Notification regarding the enhancement of minimum amount of default to one crore for the purpose of Section 4 was issued by the Ministry of Corporate Affair on 24th March, 2020 and the amount defaulted by the Corporate Debtor and filing of the petition was before that i.e. on 01.03.2020. Since any notification issued by the Government are generally Prospective in nature unless specifically expressed, hence the notification is not applicable to the present case - the instant Application satisfies the pecuniary criteria under Section 9 of the Code, 2016.
This Authority is satisfied that there is an outstanding operational debt as well as there is default by the corporate debtor. Considering the facts and circumstances in which this debt has arisen, the nature of the Debt is an 'Operational Debt' as defined under section 5 (21) of the Definitions under the Code and there is a "Default" also as defined under section 3 (12) of the Code on the part of the Corporate Debtor.
This Authority is of the firm view that there was default on the part of the respondent in pursuance of invoices raised on behalf of the applicant. Accordingly, the present application stands admitted in terms of Section 9(5) of the Code and CIRP is hereby ordered to be initiated against the respondent Corporate Debtor, forthwith - Application admitted - moratorium declared.
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