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Insolvency and Bankruptcy - Case Laws
Showing 1 to 20 of 43 Records
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2018 (2) TMI 2100 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , NEW DELHI
Seeking clarification as to who will sign the cheque on behalf of the Corporate Debtor - HELD THAT:- It is clarified that after appointment of the Resolution Professional and declaration of moratorium, the Board of Director stands suspended, but that does not amount to suspension of Managing Director or any of the Director or officer or employee of the Corporate Debtor. To ensure that the Corporate Debtor remains on going concern, all the Director/ employees are required to function and to assist the Resolution Professional who manages the affairs of the Corporate Debtor during the period of moratorium. If one or other officer or employee had the power to sign a cheque on behalf of the Corporate Debtor prior to the order of moratorium, such power does not stand suspended on suspension of the Board of Directors nor can be taken away by the Resolution Professional. If, the person empowered to sign cheque refuse to function on the direction of the Resolution Professional or misuse the power, in such case it is always open to the Resolution Professional to take away such power after notice to the person concerned.
Post the case for hearing on 12th March, 2018. Case may be disposed of on the next date.
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2018 (2) TMI 2076 - NATIONAL COMPANY LAW TRIBUNAL CHENNAI
Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- This Adjudicating Authority is satisfied that the petitioner has proved by placing overwhelming evidence that default has occurred which the Corporate Debtor was responsible to pay. In relation to the laches as pointed out respondent in his counter, it is pertinent to mention that the petitioner has established clearly that the amount in default is genuine and is supported by the documentary evidence placed - the said objection is not a valid ground of rejection of the instant petition.
Application admitted - moratorium declared.
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2018 (2) TMI 2046 - NATIONAL COMPANY LAW TRIBUNAL, SINGLE BENCH, CHENNAI
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: It has been ascertained that the Corporate Debtor havedefaulted in making payment of the outstanding debt. The Financial Creditor has fulfilled all the requirements of law and has also proposed the name of IRP after obtaining the written consent in Form-2. Therefore, petition is admitted and the commencement of the Corporate Insolvency Resolution Process is ordered which ordinarily shall get completed within 180 days, reckoning from the day this order is passed.
Petition admitted - moratorium declared.
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2018 (2) TMI 2014 - AJUDICATING AUTHORITY (NATIONAL COMPANY LAW TRIBUNAL) AHMEDABAD
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - whether dispute mentioned in the reply notice given by the corporate debtor to the operational creditor was there in existence even before the date of issuance of demand notice under Section 8 Of the Code? - HELD THAT:- Dispute mentioned in the reply notice is operational creditor failed to supply the finished goods as per MOU dated 31.10.2013. Operational creditor also retained the raw material that supplied to the operational creditor from and on behalf of the corporate debtor. The fact that raw material belonging to the corporate debtor has been retained by the operational creditor is an admission by the operational creditor. To appreciate this fact, it is necessary to examine the dates of events. MOU was entered into on 31.10.2013. Amount claimed in the invoices is from 16.11.2013 to 01.01.2014. The supply of various chemical materials by the petitioner to the respondent from 10.06.2013 to 17.10.2013. According to the petitioner payments were made from 01.12.2013 to 04.09.2014.
In the absence of any material to show that the cheques were issued on 31.10.2013 it shall be presumed that the cheques were issued on the date that was appearing on the cheques. Therefore, the issuance of cheques in the year 2014 and 2015 Clearly goes to show that there was no existence of dispute between the petitioner and respondent before issuance of demand notice. Therefore, it is a clear a case where a dispute has been raised for the first time in the reply notice. It is not a case where existing dispute has been brought to the notice of the petitioner by the respondent.
The petition is complete in all respects it deserves to be admitted.
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2018 (2) TMI 2002 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- The Adjudicating Authority rightly dealt with the matter of Form “C” - In view of the fact that there is an existence of dispute relating to quality of goods supplied by the Appellant, the Adjudicating Authority rightly refused to entertain the application under Section 9 of the ‘I&B Code’.
Appeal dismissed.
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2018 (2) TMI 2001 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Application for clarification preferred by the Resolution Professional - direction to Resolution Professional to complete the Corporate Insolvency Resolution Process within extended 90 days period from the 181st day of the resolution process - HELD THAT:- Similar issue fell for consideration before this Appellate Tribunal in QUANTUM LIMITED (CORPORATE DEBTOR) VERSUS INDUS FINANCE CORPORATION LIMITED [2018 (2) TMI 1721 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] where it was held that Adjudicating Authority has not hold that the subject matter of the case do not justify to extend the period. It has not been rejected on the ground that the committee of creditors or resolution professional has not justified their performance during the 180 days. In such circumstances, it was duty on the part of the Adjudicating Authority to extend the period to find out whether a suitable resolution plan is to be approved instead of going for liquidation, which is the last recourse on failure of resolution process.
It is declared that the 90 days of extended period be counted w.e.f. 16th January, 2018 i.e. the date on which the Adjudicating Authority passed order for extension of 90 days period. The period between 181st day and the date of passing of the order by the Adjudicating Authority i.e. 16th January, 2018 shall not be counted for any other purpose and is to be excluded for counting the extended period - appeal allowed.
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2018 (2) TMI 1973 - SC ORDER
Corporate insolvency procedure - existence of dispute - HELD THAT:- Issue Notice.
Until further orders, there shall be stay of operation of judgment and order dated 16.08.2017 passed by the National Company Law Tribunal, New Delhi.
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2018 (2) TMI 1970 - NATIONAL COMPANY LAW TRIBUNAL, MUMBAI
Recovery of outstanding dues - rights for the benefit of the Corporate Debtor in any Judicial Proceedings - HELD THAT:- Prima facie, the action of the Professional against one of the Debtor of the S.N. Plumbing appears to be a correct legal action. It is one of the duty of the Resolution Professional to recover the outstanding Debts of a Corporate Debtor against whom already CIRP is in progress - Indeed, it is the duty of the IRP/RP to take all possible steps not only to invite Resolution Applicant but to take steps for recovery of the Debts outstanding. The action against IL & FS Engineering is one of such action as a Corporate Debtor by invoking the provisions of section 9 of The Code. As per the statement made before us by the RPI no other case is pending against IL & FS in the capacity of a Corporate Debtor.
The language of Section 60(2) and other allied provisions of The Code has no ambiguity that no two parallel Insolvency Proceedings must run against a Corporate Debtor. Hence a clarification is needed in this case that S.N. Plumbing has not submitted the impugned Petition before the respected NCLT Bench, Hyderabad in the capacity of a Corporate Debtor but undisputedly, the said Petition is filed in the capacity of an Operational Creditor by submitting Form No.5 as prescribed under The Code - We have been informed that the impugned Petition is filed by the Resolution Professional on behalf of S.N. Plumbing. This action of the Resolution Professional is a right recourse for managing the affairs of the financially stressed Company.
Application allowed.
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2018 (2) TMI 1964 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Service of Notice - Appellant submits that no notice was issued by the Adjudicating Authority (National Company Law Tribunal) prior to admitting the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The Respondents are allowed to enclose the copy of the order passed by the Adjudicating Authority by which Registry of Tribunal was ordered to issue notice.
Learned counsel for the Appellant next contended that the 'Corporate Debtor' is a non-banking financial Company and is a financial service provider; therefore, it does not come within the definition of 'Corporate Person', nor a 'Corporate Debtor' - Counsel for the Respondent prayed for and is allowed a week's time to file additional affidavit enclosing the copy of the order passed by the Adjudicating Authority by which Registry of Tribunal was ordered to issue notice.
Post the matter on 15th March, 2018.
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2018 (2) TMI 1954 - NATIONAL COMPANY LAW TRIBUNAL, KOLKATA
Maintainability of application - initiation of CIRP - Corporate debtor failed to make repayment of outstanding dues - existence of debt and dispute or not - Whether the respondent succeeded in proving the existence of a genuine dispute as alleged in the reply of the Corporate Debtor? - HELD THAT:- The corporate debtor failed to establish existence of a dispute falls within the purview of section 5(6) of the I&B, Code. So also the corporate debtor failed in proving existence of dispute as held in the case of MOBILOX INNOVATIONS PRIVATE LIMITED VERSUS KIRUSA SOFTWARE PRIVATE LIMITED [2017 (9) TMI 1270 - SUPREME COURT]. The claim made by the operational creditor is not at all hit by section 9(5)(ii)(d) of the I&B, Code as contended on the side of the corporate debtor. The application file under section 9 of I&B, code on the other hand is complete. There is no repayment of the unpaid operational debt. No insolvency professional is proposed by the operational creditor. Hence compliance of section 9(5)(2)(e) doesn't arise.
This application filed under section 9 of the I&B, Code is liable to be admitted - Application admitted - moratorium declared.
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2018 (2) TMI 1930 - NATIONAL COMPANY LAW TRIBUNAL, MUMBAI
Maintainability of petition - initiation of CIRP - Corporate debtor defaulted in repayment of amount - operational creditor - Existence of dispute or not - HELD THAT:- The Operational Creditor has issued valid purchase orders to the Debtor and also paid the Advance amount for the said purchase - on number of occasions the Debtor has accepted his default in payment of outstanding amount but has not repaid the outstanding amount.
The Operational Creditor has established that the nature of Debt is an "Operational Debt" as defined under section 5(21) of the Definitions under The Code, as the Operational Creditor has issued a valid purchase orders and also paid the advance amount for those purchases. Further, he has also established that there is a "Default" as defined under section 3 (12) of The Code on the part of the Debtor - We have also perused the notice sent under Section 8 (2) of the Insolvency and Bankruptcy Code, 2016 and it came to our notice that the said notice is duly served upon the Debtor. Further, if the Respondent wanted to place on record evidence of 'Dispute' then he could have raised the objection within 10 days as prescribed under section 8 (2) of The Code which had also lapsed now. Hence, admittedly there is no "Dispute" in respect of the outstanding Debt.
Petition admitted - moratorium declared.
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2018 (2) TMI 1849 - NATIONAL COMPANY LAW TRIBUNAL MUMBAI
Operational Debt - petition filed by Operational Creditor under I&B Code by invoking the provisions of section 9 - whether on receiving the principal operational debt amount during the pendency of the Petition before NCLT, the Petitioner can press for the admission of the Petition only in respect of the Interest amount alleged to be outstanding, firstly without revising the claim of Outstanding Debt and secondly when the eligibility of Interest claim is challenged by the Operational Debtor?
Held that:- The charging of Interest on an outstanding Debt ought to be an Actionable Claim so that admissible under the eyes of Law. Claim of Interest is therefore within the ambits of an Actionable Claim which is enforceable under Law - As far as the question of present controversy related to charging of Interest is concerned, the same is enforceable if it is properly documented and agreed upon. It is also necessary that the rate of Interest should also be agreed upon between the Parties. In the present case, these basic requirements appear to be missing. Rather, the Petitioner had not established to the hilt the eligibility of claim of Interest. Merely a filing of a calculation sheet, that too a computer generated statement, is in our humble opinion, a self-serving document and not a cogent evidence admissible under the Law. The absence of a written instrument acknowledging the Liability of Interest payment as also acknowledging the Liability of the rate at which Interest was to be charged, definitely affect adversely the Claim of the Petitioner.
When the Principal amount of Debt had admittedly been paid and duly accepted by the Petitioner and the claim of Interest remained unsubstantiated in the absence of cogent evidence, the "Operational Debt" in question remained unascertainable - Petition dismissed.
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2018 (2) TMI 1838 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Fast Track Corporate Insolvency Resolution Process - HELD THAT:- Any person may intervene and may bring the facts to the notice of the Adjudicating Authority. So far as the Respondent (Intervener) is concerned, we leave the question open for Adjudicating Authority to decide the issues as raised and alleged by the 2nd Respondent (Intervener) keeping in mind the question of maintainability of the application as raised by the Appellant.
The Appellant has already served the copy of the paper book to the learned counsel for the 2nd Respondent (Intervener) which includes petition under Section 55 to 58 and therefore the service of petition under Section 55 to 58 to the 2nd Respondent (Intervener) stands complied.
The case be remitted back to the Adjudicating Authority to decide all the issues including the question of maintainability of the intervention petition keeping in mind the allegations made therein and the penal provisions including Section 65 as referred to above.
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2018 (2) TMI 1837 - NATIONAL COMPANY LAW TRIBUNAL, AHMEDABAD
Corporate Insolvency Resolution Process - outstanding debt - HELD THAT:- This petition insofar the first petitioner is concerned it cannot be admitted but coming to the case of petitioners No. 2 and 3 they have got every right to trigger corporate insolvency resolution process because financial debt is due to them and there is occurrence of default. Moreover, the pendency of Company Petition filed by petitioners against the respondent company is not a ground to take a different view in this matter. The points that would come up for consideration is altogether different qua the rights of shareholders whereas in this petition the Adjudicating Authority has to see whether there is existence of financial debt and occurrence of default. Since these two things are satisfied, this petition in respect of petitioners No. 2 and 3 deserves to be admitted and it is accordingly admitted.
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2018 (2) TMI 1836 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Insolvency Resolution Process for Corporate Persons - whether the order of ‘Moratorium’ will cover the current charges payable by the ‘Corporate Debtor’ for supply of water, electricity etc. or not? - HELD THAT:- From sub-section (2) of Section 14 of the ‘I&B Code’, it is clear that supply of essential goods or services to the ‘Corporate Debtor’, as may be specified by the ‘Insolvency and Bankruptcy Board of India’, cannot be terminated or suspended or interrupted during the period of ‘Moratorium’.
Regulation 31 relates to ‘Insolvency Resolution Process Costs’ whereas Regulation 32 relates to ‘Essential Supplies’. As per Regulation 31, the amounts due to suppliers of essential goods and services under Regulation 32 are to be included in the ‘Insolvency Resolution Process Costs’.
It is clear that the amount as is due towards supply of essential goods and services, including electricity, water, telecommunication services and information technology services, if they are not a direct input to the output produced or supplied by the ‘Corporate Debtor’, require to be included towards ‘Insolvency Resolution Process Costs’ as per sub-section 13(e) of Section 5.
From sub-section (2) of Section 14 of the ‘I&B Code’, it is also clear that essential goods or services, including electricity, water, telecommunication services and information technology services, if they are not a direct input to the output produced or supplied by the ‘Corporate Debtor’, cannot be terminated or suspended or interrupted during the ‘Moratorium’ period.
From the provisions of ‘I&B Code’ and Regulations, we find that no prohibition has been made or bar imposed towards payment of current charges of essential services. Such payment is not covered by the order of ‘Moratorium’. Regulation 31 cannot override the substantive provisions of Section 14; therefore, if any cost is incurred towards supply of the essential services during the period of ‘Moratorium’, it may be accounted towards ‘Insolvency Resolution Process Costs’, but law does not stipulate that the suppliers of essential goods including, the electricity or water to be supplied free of cost, till completion of the period of ‘Moratorium’.
Payment if made towards essential goods to ensure that the Company remains on-going as made in the present case for the month of December, 2017, such amount can be accounted towards ‘Insolvency Resolution Process Costs’, but it does not mean that supply of essential goods such as electricity to be supplied free of cost and the ‘Corporate Debtor’ is not liable to pay the amount till the completion of the period of ‘Moratorium’. If the ‘Corporate Debtor’ has no fund even to pay for supply of essential goods and services, in such case, the ‘Resolution Professional’ cannot keep the Company on-going just to put additional cost towards supply of electricity, water etc. In case the ‘Corporate Debtor’ (Company) is non-functional due to paucity of fund, and has become sick the question of keeping it on going does not arise.
In absence of specific prohibition for payment of current charges and in view of the fact that the ‘Corporate Debtor’ has already paid the current electricity charges for the month of December, 2017, we pass the following orders: -
(i) The ‘Resolution Professional’ will pay the outstanding current charges for supply of electricity for the month of September, 2017 and January, 2017 to the Appellant by 28th February, 2018. The current electricity charges for the month of October, 2017 and February, 2017 be paid by 16th March, 2018. The current charges towards the electricity for the month of November, 2017 and March, 2018 be paid by 15th April, 2018.
(ii) The Appellant will not levy any late payment surcharges for delayed payment of current charges, nor disconnect the supply of electricity in view of sub-section (2) of Section 14 of the ‘I&B Code’.
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2018 (2) TMI 1822 - NATIONAL COMPANY LAW TRIBUNAL, KOLKATA
No further relief is sought for regarding CA(IB) No. 518/KB/2017. Therefore the CA stands disposed of in terms of the order already passed on 12/01/2018 - List it on 12/03/2018 for filing further progress report.
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2018 (2) TMI 1739 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Initiation of Corporate Insolvency Resolution Process against the Corporate Debtor for its inability to pay its debt - Held that:- There is clear acknowledgment of having received the amount of ₹ 40 lakhs. As per the agreement, the financial creditor had the option of seeking its return after 1 year along with interest @ 27% per annum. This is further substantiated with the issuance of two cheques payable on expiry of a year, for ₹ 40 lakhs as the principal and ₹ 10.8 lakhs as the interest thereon. The Corporate Debtor never raised this feeble ground to repudiate the liability when demands were made on them time and again.
This Bench is satisfied that a Financial Debt is due and payable by the Corporate Debtor. Their inability to pay the same entitles the Financial Creditor to seek insolvency resolution process against the Corporate Debtor. The Petition is therefore Admitted.
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2018 (2) TMI 1726 - NATIONAL COMPANY LAW TRIBUNAL, CHANDIGARH
Corporate insolvency process - complied with the mandatory requirements of Section 9(3)(b) and 9(3)(c) of the Code - Held that:- Referring to the affidavit of petitioner which states that the petitioner did not receive any notice of dispute from the corporate debtor nor the outstanding amount has been paid. The petitioner has also filed copy of statements of account of the petitioner in which the amount of debt is being normally credited. The petitioner has also filed certificate from Axis Bank (Annexure P12), the financial institution where the petitioner is maintaining the account that no credit of the amount has been given in the account of the petitioner on behalf of the respondent-corporate debtor for the period 01.01.2018 to 16.02.2018. This aspect otherwise is not disputed by the respondent-corporate debtor.
We find that all the compliances have been made and the application is complete and the petition deserves to be admitted. In view of the above, the instant petition is admitted declaring moratorium for prohibiting all accordingly.
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2018 (2) TMI 1718 - NATIONAL COMPANY LAW TRIBUNAL, NEW DELHI
Corporate Insolvency Resolution Process - Held that:- This petition is admitted. Mr. Vijay Kumar V Iyer who is duly registered with the Insolvency and Bankruptcy Board of India is appointed as an Interim Resolution Professional. He has also filed his certificate of registration with the IBBI along with his written communication dated 29.06.2017. The disclosure has also been made in the letter dated 29.06.2017. We have also found his latest registration number from the IBBI website and the same has already been quoted in the preceding paras.
In pursuance of Section 13 (2) of IBC we direct that public announcement shall be immediately made by the Interim Resolution Professional with regard to admission of this application under Section 7 of IBC. We also declare moratorium in terms of Section 14 of IBC. A necessary consequence of the moratorium flows from the provisions of Section 14 (1) (a), (b), (c) & (d).
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2018 (2) TMI 1355 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Corporate insolvency process - eligible debt - Winding up proceeding under the Companies Act or liquidation proceeding under the I & B Code initiated - Held that:- In the present case we find that the Adjudicating Authority has noticed extraneous factors unrelated to Corporate Insolvency Resolution Process which are not required to be disclosed in terms of Section 10 of I&B Code or Form 6.
It is not the case of the ‘Financial Creditor’ (Respondent) that a winding up proceeding under the Companies Act or liquidation proceeding under the I & B Code has been initiated against the Corporate Debtor. Therefore, we hold that the Corporate Applicant is eligible to file application under Section 10, there being a debt and default.
The impugned order dated 20th June, 2017 cannot be upheld and is accordingly set aside. The case is remitted back to the Adjudicating Authority for admission of the application under Section 10, if the application is otherwise complete.
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