Dhirendra Sheth vs Atrium Infocomm Pvt. Ltd.

That, the instant application is filed by Mr. Dhirendra Sheth, under Section 9 of the Insolvency and Bankruptcy Code, 2016 [hereinafter referred to as "the Code"] read with Rule 6 of the Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016 to trigger Insolvency Resolution Process against M/s. Atrium Infocomm Private Limited (hereinafter called as respondent/corporate debtor).

That, the applicant/operational creditor Mr. Dhirendra Sheth is an employee of the respondent company, having his residence at C/16, Shree Prakash Society, Naroda, Ahmedabad 382 330 and having PAN AGSPS5336B.

That, the respondent/corporate debtor M/s. Atrium Infocomm Private Limited is a company incorporated under the Companies Act on 24.07.1997 and having its registered office at 20, First Floor, Super Plaza, Sandesh Press Road, P.O. Bodakdev, Vastrapur, Ahmedabad 380 054, Gujarat State, having identification No. U32100GJ1997PTC032724. That, authorised share capital of the corporate debtor is Rs. 15,00,00,000/- and paid up share capital is Rs. 7,50,00,000/-.

It is submitted by the applicant that, as per the appointment letter dated 05.04.2017, the applicant was appointed for the position of Head Worker in the respondent company with additional responsibility to look after legal and administrative departments of the company with effect from 05.04.2017 at a monthly compensation of Rs. 99,500/-. The applicant has submitted a chart showing the details of salary outstanding from May 2017 till December, 2018 which is placed at page No. 33 to the application.

The applicant has submitted copies of the following documents in support of the claim: -

Mr. Sunil Kakkad, managing promoter and authorised representative of the respondent company filed reply inter alia stating that the respondent company became non-operational in the years 2014-15. It is further stated that, Mr. Sunil Kakkad was arrested on 12.05.2017 in connection with FIR 1/2015 filed by CBI and he was incarcerated and was released on bail on 1.12.2018. It is further stated by the respondent that due to such long period of incarceration, business of the respondent company came to a complete standstill and, therefore, there is no hope felt in reviving the company by the promoters and the management unless some third party takes over the company. On account of the very such reasons salary of the applicant could not be paid by the respondent company and looking to the current financial and business position, the respondent company is not in a position to make payment of the applicant. During the course of hearing, learned lawyer appearing on behalf of the respondent also fairly admitted that the respondent company is unable to make payment to the petitioner.

On perusal of the record, it is found that the petitioner was appointed in the respondent company vide appointment letter dated 05.04.2017 and he has been looking after the affairs of the company. That, despite assurance given by the respondent company vide letter dated 01.01.2019, outstanding salary of the applicant has not been given so far.

While examining an application under Section 9 of the Act, will have to determine the following: -

In view of the aforesaid discussions and before rejecting and/or admitting the application, we must refer to the legislation guide on Insolvency Law of United Nations Commission on International Trade Law. One of the things the Legislative Guide spoke about was whether the debt is subject to a legitimate dispute or set off, in an amount equal to or greater than the amount of the debt.

Thus, under the facts and circumstances and as discussed above, in the light of the Hon'ble Supreme Court Judgement and the provisions thereof as enshrined in Insolvency & Bankruptcy Code, this adjudicating authority is of the considered view that operational debt is due to the Applicant and in support of that operational creditor has placed copy of chart giving details of salary outstanding. That, the respondent has acknowledged the debt in letter dated 01.01.2019 and has not raised any dispute. In the reply filed by the respondent, the receipt of notice has been acknowledged. Therefore, service is complete. That, Applicant is an Operational Creditor within the meaning of sub-section (5) of Section 20 of the Code. From the aforesaid material on record, petitioner is able to establish that there exists debt as well as occurrence of default.

That, the Application filed by the Applicant is complete in all respects.

The applicant/operational creditor has not proposed the name of Interim Insolvency Professional. This adjudicating Authority hereby appoint Shri Manish Kumar Bhagat, 103-104 Panchdeep Complex, Mithakhali Six Road, Navrangpura, Ahmedabad ([email protected]) having registration No. IBBI/IPA-001/IP-P00856/2017-2018/11438 to act as an interim resolution professional under Section 13(1)(c) of the Code.

Section 13 of the Code enjoins upon the Adjudicating Authority to exercise its discretion to pass an order to declare a moratorium for the purposes referred to in Section 14, to cause a public announcement of the initiation of corporate insolvency resolution and call for submission of claims as provided under Section 15 of the Code. Sub-section (2) of Section 13 says that public announcement shall be made immediately after the appointment of Interim Insolvency Resolution Professional. This Adjudicating Authority directs the Insolvency Resolution Professional to make public announcement of initiation of Corporate Insolvency Process and calls for submission of claims under Section 15 as required by Section 13(1)(b) of the Code.

From the above stated discussion and on the basis of material available on record it is a fit case to initiate Insolvency Resolution Process by admitting the Application under Section 9(5)(1) of the Code.

The petition is, therefore, admitted and the moratorium is declared for prohibiting all of the following in terms of sub-section (1) of Section 14 of the Code: -

It is further directed that the supply of goods and essential services to the Corporate Debtor, if continuing, shall not be terminated or suspended or interrupted during moratorium period. The provisions of sub-section (1) shall, however, not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator.

The order of moratorium shall have effect from the date of receipt of authenticated copy of this order till the completion of the corporate insolvency resolution process or until this Bench approves the resolution plan under sub-section (1) of Section 31 or passes an order for liquidation of corporate debtor under Section 33 as the case may be.

This Petition stands disposed of accordingly with no order as to costs.

Communicate a copy of this order to the Applicant, Financial Creditor, Corporate Debtor and to the Interim Insolvency Resolution Professional.