TMI Blog2019 (10) TMI 108X X X X Extracts X X X X X X X X Extracts X X X X ..... Akshat Khare, Advocate, on behalf of Moson Le Exparts For The Respondent : Mr Karan Sanghani, Advocate ORDER Per : Harihar Prakash Chaturvedi, Member (J) The present Application is filed by Ms. Parulben Pankajbhai Tejani, being a Financial Creditor, under Section 7 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred as I B Code) read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 [ Adjudication Rules for short] for initiating Corporate Insolvency Resolution Process (hereinafter referred to as CIRP)' against M/s. Tirupati Balaji Polymers Pvt. Ltd. [hereinafter called as Respondent/Corporate Debtor ]. 2. The applicant, viz., Mrs. Parulben Pankajbhai Tejani is an individual person, having resident at B-56, Radhakrishna Society, Khodiyar Nagar Road, Varachha, Surat-395 006, Gujarat. 3. The respondent-corporate debtor, M/s. Tirupati Balaji Polymers Pvt. Ltd., is a Company, bearing CIN: U24134GJ2011PTC064442, incorporated on 15.03.2011, under the provisions of the Companies Act 1956, having its Registered Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Witness) 6. The petitioner has stated that as per clause no. 2 of the loan agreement, the corporate debtor had agreed to repay the said loan amount within 15 days from the date of demand made by the applicant. Further, as per clause no.3, if such demand is not made by the applicant, then the corporate debtor was required to repay the entire outstanding amount along with interest and cost latest by 31.12.2017. 7. It is stated that the Petitioner did not make any demand prior to 31.12.2017, hence, the corporate debtor was required to repay the said amount on or before 31.12.2017 as per the terms and conditions of the loan agreement, but the corporate debtor had failed to repay the entire outstanding amount to the petitioner/financial creditor. 8. It is stated that thereafter the petitioner had issued Demand Notice dated 03.01.2018 to the corporate debtor and had called upon to pay the entire outstanding amount together with the accrued interest and cost as per the loan agreement. (A copy of the Demand Notice is annexed with the application as Annexure-D). Even after issuance of Demand Notice, the Corporate Debtor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces of the present case, we examined the relevant provisions of Section 7 of the I B Code and Rules Applicable. Section 7 of the Code reads as under; 7. Initiation of Corporate insolvency Resolution Process by Financial Creditor. (1) A financial creditor either by itself or jointly with other financial creditors may file an application for initiating corporate insolvency resolution process against a corporate debtor before the Adjudicating Authority when a default has occurred. Explanation. -For the purposes of this sub-section, a default includes a default in respect of a financial debt owed not only to the applicant financial creditor but to any other financial creditor of the corporate debtor. (2) The financial creditor shall make an application under sub-section (1) in such form and manner and accompanied with such fee as may be prescribed. (3) The financial creditor shall, along with the application furnish- (a) record of the default recorded with the information utility or such other record or evidence of default as may be specified; (b) the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11) 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; 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 repaid by the debtor or the corporate debtor, as the case may be. 13. Further the petitioner in the present application has proposed name of Mr. Kashyap Shah, at A-l, Sejal Park, Opp. Nathiba Nagar No. 2, Harni Road, Vadodara-390 022, E-mail; kashyap.cs@gmail.com, Registration No.IBBI/IPA-002/IP-N00367/2017-18/11035. The Petitioner has annexed a Written Communication (Annexure-G) received from the proposed Interim Resolution Professional by giving consent to act as IRP in case he is appointed. Further declaring that there is no disciplinary proceeding pending against him. He also furnished his IB Registration number as mentioned above and the requisite information in the prescribed Format, which satisfies the requirement of Section 7(3)(b) of the I B Code. 14. As the default of debts is established for a sum of ₹ 8,00,000/- + simple interest @ 9% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rused the court proceedings dated 25.06.2019 and noticed that some typographical error occurred, which is rectified suitably. 17. We examined the merits of the present IB Petition in the light of the decision of the Hon'ble Supreme Court in the matter of Innoventive Industries Ltd. v. ICICI Bank Ltd. Anr. [Civil Appeal Nos. 8337 of 2017] wherein Their Lordship has pleased to prescribe the criteria and minimum requirement for initiation of CIRP, if such conditions are satisfied, the Adjudicating Authority is expected to admit such petition. 18. For the sake of convenience, the relevant extract of the Judgment is reproduced hereinbelow; 27. The scheme of the Code is to ensure that when a default takes place, in the sense that a debt becomes due and is not paid, the insolvency resolution process begins. Default is defined in Section 3(12) in very wide terms as meaning non-payment of a debt once it becomes due and payable, which includes non-payment of even part thereof or an instalment amount For the meaning of debt , we have to go to Section 3(11), which in turn tells us that a debt means a liability of obligation in respect of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the debt , which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under sub-section (7), the adjudicating authority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admission or rejection of such application, as the case may be 19. By following the above stated judicial precedents and having heard the oral submission of learned counsel for both parties, i.e., Mr. Akshat Khare, Advocate, for the Financial Creditor and Mr. Karan Sanghani, Advocate for the Corporate Debtor, we find that the present IB Petition is complete as filed in conformity of the prescribed procedure under the I B Code, hence, it de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (vii) The Interim Resolution Professional shall perform all his functions strictly which are contemplated, inter alia, by Sections 17, 18, 20, 21 of the Code. It is further made clear that all the personnel connected with Corporate Debtor, its promoter or any other person associated with Management of the Corporate Debtor are under legal obligation under Section 19 of the Code extend every assistance and co-operation to the Interim Resolution Professional. Where any personnel of the corporate debtor, its promoter or any other person required to assist or co-operate with IRP, does not assist or co-operate, IRP would be at liberty to make appropriate application to this Tribunal with a prayer for passing an appropriate order. (viii) The IRP shall be under duty to protect and preserve the value of the property of the 'Corporate Debtor company' and manage the operations of the Corporate Debtor company as a going concern as a part of its obligation imposed by Section 20 of I B Code, 2016. (ix) The Financial Creditor is directed to communicate a copy of this order to the Interim Resolution Professional, the Respondent Corporate Debto ..... X X X X Extracts X X X X X X X X Extracts X X X X
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