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2020 (3) TMI 488 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debta nd default or not - pledge of dematerialized shares - HELD THAT:- The said is due on the Corporate Debtor and there is a default in making the payment towards the liability to the Petitioner. This fact is even not denied by the Corporate Debtor which is also evident from the documents including the various e-mails. The Corporate Debtor contended that the petitioner sold the pledged shares at a lower price and therefore, this petition is not maintainable because the petitioner who is the pawnee in this case is not in a position to redeliver the security pledged and thus cannot obtain a decree - the petitioner was not under an obligation to inform the Corporate Debtor before selling the shares pledged. Also, the pledged shares were all in DEMAT form and not in physical form - It is well settled principle by the judgments of various High Courts, that the pledged of dematerialized shares is not possible under the provisions of the Contract Act and the pledgement of the dematerialized shares are only governed by Depositors and Regulations (58) (1) to (6) made thereunder and hence section 176 of the Contract Act will not apply in the present matter. The contention of the Corporate Debtor cannot be relied upon and it cannot be denied that they are liable to pay to the petitioner the amounts due upon them and here it is pertinent to note that the Corporate Debtor time and again requested the petitioner for restructuring of the loan amount. Therefore, it can be said that there was an acknowledgement of the debt by the Corporate Debtor. This Adjudicating Authority, on perusal of the documents filed by the Creditor, is of the view that the Corporate Debtor defaulted in repaying the loan availed. In the light of above facts and circumstances, the existence of debt and default is reasonably established by the petitioner/Financial Creditor as a major constituent for admission of a petition under section 7 of the I&B Code. Therefore, the Application under sub-section (2) of section 7 is taken as complete, accordingly this Bench hereby admits this Petition - Petition admitted - moratorium declared.
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