Amrit Steels vs Tehri Iron & Steel Casting Limited

The instant application has been filed under the provisions of Section 9 of Insolvency and Bankruptcy Code, 2016 (for brevity ""IBC"") read with Rule

6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 for initiation of Corporate Insolvency Resolution Process

(CIRP) of Tehri Iron & Steel Casting Ltd. (for brevity the Company'), by Amrit Steels.

The applicant is a proprietary concern of proprietor Mr. Sandeep Agarwal, having office of business at Rainbow Road, Near Bharat Steel Rolling

Mills, Muzaffarnagar-251003, who is engaged in the business of supply of old iron scrap.

The Corporate Debtor is incorporated on 19.07.2005 with CIN U27106DL2005PLC138820 having registered office at Unit No. 101, 1st Floor, V4

Tower, Plot No. 14, Community Centre, Karkardooma, Delhi 110092.

It is the case of the Applicant that the Corporate Debtor had approached it for supply of old iron scrap. Upon instruction from the Corporate Debtor

vide its various purchase orders, the Applicant supplied old iron scrap to the Corporate Debtor Thereafter, the Applicant issued various invoices on the

Corporate Debtor amounting to Rs. 4,48,82,739/- from 28.04.2017 to 09.06.2017. the Corporate Debtor agreed to make payment within 45 days from

the date of issue of invoices.

As per the claim of Applicant, the Corporate Debtor made on account partial payments for Rs. 1,44,50,000/- from 15.06.2017 to 13.03.2018. The

Corporate Debtor returned the old iron scrap amounting to Rs. 49,47,911/- and in turn raised invoices from 08.02.2018 to 23.02.2018 for the said

returned iron scrap. After adjustment of on account payments and invoices for supply/return of old iron scrap there is an overdue outstanding of Rs.

2,54,84,828/-.

The Applicant from time to time requested the Corporate Debtor to clear the outstanding amount, however, Corporate Debtor failed to pay the

balance amount due to the Applicant. Since no payment was forthcoming the Applicant issued notice under Section 8 of the Insolvency and

Bankruptcy Code on 19.03.2018 to the Corporate Debtor.

Despite receipt of the notice of demand sent u/s 8 of the IBC, the company has failed to pay the amount demanded and also has not replied to the

demand notice raising any dispute, as a consequence this application, seeking to unfold the process of CIRP, is filed by the Corporate Debtor.

The Applicant has served the Corporate Debtor as per record and further states that even after the service the Corporate Debtor failed to reply or

appear before this tribunal.

The Applicant has not filed the bank certificate as required u/s. 9(3)(c) of I&B Code relying on the order dated 15.12.2017 passed by Honble

Supreme Court in the matter of Macquarie Bank Limited Vs. Shilpi Cable Technologies Ltd.

The applicant has also filed affidavit under section 9(3)(b) regarding neither payments being received nor raising of dispute from the Corporate

Debtor.

Since the amount of debt claimed is Rs. 2,54,84,828/- which is above 1 lakh and the default occurred on 24.07.2017, the debt is not time barred and

the application is filed within the period of limitation.

As the registered office of the Corporate Debtor is in Delhi, so the matter falls within the territorial jurisdiction of this Tribunal.

The parameters to initiate CIRP as required under Insolvency and Bankruptcy Code are duly complied with and the application is complete.

In the circumstances mentioned above Corporate Debtor despite repeated service has not appeared before this Tribunal and existence of a default

of debt due to the Applicant is established. The Tribunal is of the considered view that this application requires to be admitted and that CIRP process

is required to be initiated against the Corporate Debtor.

The Applicant has proposed the name of any IRP Mr. Praveen Barisal r/o J-347, Block J, Santa Vihar, New Delhi, having mail id.-

pkbansa100@gmail.com is duly registered with Insolvency and Bankruptcy Board of India and having registration No. IBBI/IPA-001/IP-

PO0175/2017-18/10344, be and is hereby appointed as an Interim Resolution Professional.

In pursuance of Section 13(2) of the IBC, we direct that Interim Insolvency Resolution Professional shall immediately make public announcement

with regard to admission of this application under Section 9 of the IBC. As a consequence of the application being admitted in terms of Section 9(5) of

IBC, 2016 moratorium as envisaged under the provisions of Section 14(1) and as extracted hereunder shall follow in relation to the Corporate Debtor

prohibiting all of the following:

(a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or

order in any court of law, tribunal, arbitration panel or other authority;

(b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein;

(c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action

under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002;

(d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor.

However, during the pendency of the moratorium period in terms of Section 14(2) and 14(3) as extracted hereunder:

(2) The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or suspended or interrupted during

moratorium period.

(3) The provisions of sub-section (1) shall not apply to such transactions as may be notified by the Central Government in consultation with any

financial sector regulator.

The duration of the period of moratorium shall be as provided in Section 14(4) of IBC, 2016 and for ready reference reproduced as follows: -

4) The order of moratorium shall have effect from the date of such order till the completion of the corporate insolvency resolution process:

Provided that where at any time during the corporate insolvency resolution process period, if the Adjudicating Authority approves the resolution plan

under sub-section (1) of section 31 or passes an order for liquidation of corporate debtor under section 33, the moratorium shall cease to have effect

from the date of such approval or liquidation order, as the case may be.

Based on the above terms, the Application stands admitted in terms of Section 9(5) of IBC, 2016 and the moratorium shall come in to effect as of

this date.

A copy of the order shall be communicated to the Applicant as well as to the Corporate Debtor above named by the Registry. In addition, a copy of

the order shall also be forwarded to IBBI for its records. Further the IRP above named be also furnished with copy of this order forthwith by the

Registry.