M/S Stores Supply (India) Agency vs M/S I.E. Trading Co.(P) Ltd.

The present application is filed under section 9 of Insolvency and Bankruptcy Code, 2016 (for brevity 'IBC, 2016') read with Rule 6 of the

Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (for brevity 'the Rules') by M/s Stores Supply (India) Agency (for

brevity 'Applicant') with a prayer to initiate the Corporate Insolvency process against M/s I.E. Trading Company Private Limited (for brevity

'Corporate Debtor).

The Applicant is Partnership firm duly registered under Partnership Act 1932 having GSTIN 07ABFFS7558B

The Applicant is having registered office at 705, Akash Deep Building, 26-A, Barakhamba Road, New Delhi-110001

The applicant has duly authorized Mr. Pawan Chowdhary, Partner of the Applicant Partnership Firm, to file the present application by the Letter of

Authority dated 22.08.2017 at Annexure A-2.

The Applicant is an importer and stockist of Tool, Alloy and Special Steel.

The corporate debtor is private company incorporated under the provisions of the Companies Act, 1956 on 14.02.2011 having CIN

U52300DL2011PTC214087 as per Master Data of the company.

The Authorised Share Capital of the company is Rs. 1,00,000/- and Paid Up Share Capital of the company is Rs. 1,00,000 as per Master Data of

the company.

The corporate debtor is having its registered office at A-119, Okhla Industrial Area, Phase II, New Delhi-110049.

The Applicant has stated that during the course of business the Applicant has supplied Alloy Tool Steel Bar to the corporate debtor and raised

various invoices between 22.03.2013 to 15.05.2013 for the goods supplied. Further the applicant has submitted the copy of Form C received for

supplies between 03.04.2013 to 16.05.2013 which is at Annexure A-5

The applicant has submitted that the Corporate Debtor has recognized the debt,due to the applicant in the ledger accounts of applicant, as

'Operational Creditor', in the books of the Corporate Debtor. Therefore, in the statement of account duly kept and maintained by the Corporate Debtor

had duly admitted his liability to the tune of Rs. 1,41,06,227/-. The copy of confirmation of accounts with effect from 01.04.2013 to 30.04.2016 issued

by the Corporate Debtor is annexed at An.nexure A-7.

The applicant has stated that total debt due and payable by the Corporate Debtor to the applicant is Rs. 1,41,06,227/- along with interest at the rate

24% per annum with effect from 06.08.2015. Further, the applicant has submitted that the Corporate Debtor is also required to pay future and

pendente-lite interest at the rate of 18% per annum on the aforesaid amount.

As per Applicant Inspite of various requests made and reminder to the Corporate Debtor by the Applicant, the respondent has neither paid nor

responded to the applicant. The Applicant has issued a Demand Notice under section 8 of the Code, 2016 dated 06.11.2017 in Form 3 to Corporate

Debtor which was duly received at Annexure A-8 (Colly). Further, the corporate debtor has neither paid the money nor raised any dispute towards

the liability of Rs.1,41,06,227/ - as claimed by the Applicant in notice under section 8 of IBC, 2016.

This Tribunal is constrained to proceed with the matter exparte in relation to the Corporate Debtor since the section 8 notice and the present

application duly served on the Corporate Debtor and proof of service along with service affidavit is filed by the applicant making the service complete.

The Bank maintaining account of the appellant, Kotak Mahindra Bank, has confirmed vide its certificate under 9(3)(c) of the Code dated

17.04.2018 that Rs. 1,41,06,227/- from Corporate Debtor has not been received from corporate debtor between 18.09.2015 to 16.04.2018

The Applicant has filed an affidavit dated 01.05.2018 affirming that in respect of the amount claimed or any part thereof, the Applicant has not

received nor had any person, on its behalf had received in any manner the amount due to them under section 9(3)(b) of the IBC, 2016.

The registered office of corporate debtor is situated in New Delhi and therefore this Tribunal has jurisdiction to entertain and try this application.

The amount of default exceeds Rs. 1,00,000/- as per the requirement under section 4 of the Code, 2016. Hence, this application is within the

purview of section 9 of the IBC, 2016.

The default in payment of operational debt first became due from the date of the invoices raised by the Applicant that is between 03.04.2013 to

16.05.2013. As per the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 published in the Official Gazette of India on 06.06.2018 a

new provision Section 238A to the Code which makes the Limitation Act, 1963 applicable to the Code and reads as follows:

238A. The provisions of the Limitation Act, 1963 shall, as far as may be, apply to the proceedings or appeals before the Adjudicating

Authority, the National Company Law Appellate Tribunal, the Debt Recovery Tribunal or the Debt Recovery Appellate Tribunal, as the case

may be.

Since, the Corporate Debtor had duly admitted his liability to the tune of Rs. 1,41,06,227/- in the confirmation of accounts with effect from 01.04.2013

to 30.04.2016 issued by the Corporate Debtor is annexed at Annexure A-7. Further, the Applicant has submitted that the last RTGS payment received

by the company on 06.08.2015. Hence, the debt is not time barred.

In the given facts and circumstances, the present application is complete and the Applicant is entitled to claim its dues, establishing the default in

payment of the operational debt beyond doubt, and fulfillment of requirements under section 9(5) of the Code. Hence, the present application is

admitted.

Applicant has named the Interim Resolution Professional (IRP), to be appointed by the order of Tribunal, as Mr. Sanjay Kumar Agarwal having

registration number IBBI/IPA-001/IP-00494/2017-18/10882 and E-Mail IDsk a9001@gmail.com, duly registered with Insolvency and Bankruptcy

Board of India, as the Interim Resolution Professional subject to the condition that no disciplinary proceedings are pending against such an IRP named

who may act as an IRP in relation to the CIRP of the Corporate Debtor and specific consent is filed in Form 2 of Insolvency and Bankruptcy Board

of India (Application toAdjudicating Authority) Rule, 2016 in relation to specifically the Corporate Debtor and the Applicant herein and make

disclosures as required under IBBI (insolvency Resolution Process for Corporate Persons) Regulations, 2016 within a period of one week from the

date of this order.

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-

a. such transaction as may be notified by the Central Government in consultation with any financial sector regulator.

b. a surety in contract of guarantee to a Corporate Debtor.

The order of moratorium shall have effect from the date of this 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.

In terms of above order, the Application stands admitted in terms of Section 9(5) of IBC, 2016. 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.