Sangam Silver Arts LLP vs Sangam Handicraft Private Limited

This Application has been filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC, 2016) read with Rule 6 of Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 by Sangam Silver Arts LLP (for brevity ‘Applicant’) claiming to be an Operational Creditor with a prayer for initiation of Corporate Insolvency Resolution Process against Sangam Handicraft Private Limited (for brevity “Corporate Debtor”). This Application is filed through Mr. Ronak Khandelwal an Authorised Representative of the Applicant, authorised vide Board Resolution dated 12.11.2018.

The Applicant is a Limited Liability Partnership constituted under the provisions of LLP Act, 2008 on 17.07.2015, duly registered with Registrar of Companies, Jaipur bearing LLP Identification NO. AAE-4023 and the Registered Office of the Applicant is at House No. – 203, Tikkarmalka Rasta, Kishanpole Bazar, Jaipur- 302001 (Rajasthan). The Applicant is engaged in the business of manufacturing silver items.

The Corporate Debtor is a Private Limited Company incorporated under the provisions of the Companies Act, 1956 on 28.10.1997, duly registered with Registrar of Companies, Jaipur bearing CIN: U36911RJ1997PTC014378 and the Registered Office of the Corporate Debtor is at F-1, Vinay Path, Bani Park, Jaipur-302016 (Rajasthan).

It is the case of the Applicant that the applicant has supplied silver utensils to the Corporate Debtor, against which the Applicant has raised various invoices in the years 2015 and 2016. Copy of invoices are annexed vide Dairy No. 1634/2019. It submitted that the Corporate Debtor has defaulted in making payment. In order to make the payment both the parties had executed an agreement dated 16.08.2016 and it was mutually agreed that the Corporate Debtor shall make payment of the negotiated amount of Rs. 1,91,29,000/- (Rupees One Crore Ninety-One Lakh Twenty-Nine Thousand Only) along with interest @ 15% to the Applicant. Copy of Agreement is annexed as Exhibit- B with the Application. It was also agreed that the said amount will be paid in 36 monthly instalments for which the Corporate Debtor has drawn and raised 36 cheques dated from 05.09.2016 to 05.08.2019 for Rs. 6,63,113 each inclusive of interest and the principal amount.

The Applicant submits that the full payment of cheques dated 05.09.2016 to 05.03.2017 and part payment towards cheque dated 05.04.2017 is made by the Corporate Debtor. The cheques falling due from 05.04.2017 to 05.09.2018 have been dishonoured with remark “Fund Insufficient”. Copy of Return Memo report of all Cheques are annexed as Exhibit-F with the Application. In pursuance of dishonour of the cheque, the complaint under Section 138 of Negotiable Instruments Act, 1881 is filed by the Applicant.

The applicant has issued a notice dated 28.09.2018 under Section 8 of the Insolvency and Bankruptcy Code, 2016 for an amount of Rs. 1,26,21,859/- including interest @ 15% P.A. of Rs. 12,45,385/- on the Corporate Debtor, which was duly received by Corporate Debtor through post on 15.10.2018. The demand notice was also sent through email dated 29.09.2018 but the Corporate Debtor has neither replied to the Demand Notice nor raised any dispute of the unpaid operational debt. Copy of tracking report as proof of service of the said Section 8 notice is annexed. Thus, the applicant filed the present application under section 9 of the Insolvency and Bankruptcy Code, 2016.

The total amount claimed by the applicant as mentioned in Part IV is a sum of Rs. 1,26,21,859/- including interest as an outstanding amount which is due and payable by the corporate debtor as described below:

An Affidavit under Section 9(3) (b) to the effect that no reply notice is given by the Corporate Debtor relating to any dispute of the unpaid operational debt is filed by the Applicant.

Perusal of the records of the proceeding before this Tribunal shows that the Learned Counsel Ms. Anubha Singh has appeared before this Tribunal on behalf of the Corporate Debtor and ample opportunity was given to file reply. On 26.08.2019 learned Counsel Ms. Anubha Singh has submitted that she has not received any instructions from the Corporate Debtor. Accordingly, she was discharged as withdrawn from the proceedings. Thus, in view of non-appearance, this Tribunal was constrained to proceed ex- parte against the respondent and the submissions of the learned counsel for the Applicant were heard on 19.09.2019 and orders were reserved.

This Tribunal perused all the relevant papers and found them to be in order. The Registered Office of the Corporate Debtor is situated in Jaipur and therefore this Tribunal has jurisdiction to entertain and try this Application. The matter is within the purview of Law of Limitation.

It is apparent from the records that the payment of claim amount has been defaulted by the Corporate Debtor and despite the issuance of Section 8 notice under the Insolvency and Bankruptcy Code, 2016 by the Applicant and the receipt of the same by the Corporate Debtor, the payment was not made. In these circumstances the claim stands established and prima facie the presumption is raised that there is default in payment of the amount due to the Applicant and no dispute is in existence. Hence, this Tribunal is inclined to initiate the proceedings namely, Corporate Insolvency Resolution Process (CIRP) as against the Corporate Debtor as envisaged under the Provisions of the IBC, 2016 and this application is admitted.

The Applicant has named the Interim Resolution Professional (IRP) to be appointed by the order of this Tribunal, one Mr. Nitin Sethi having Registration Number IBB/IPA-001/IP-P00565/2017-18/11041 (email: [email protected], [email protected], Mobile No. : 9414078378, 9799931119), duly registered with Indian Institute of Insolvency Professional of ICAI, as the Interim Resolution Professional. The Applicant has filed consent in Form 2 vide IA No. 137/JPR/2019 under Insolvency and Bankruptcy Board of India (Application to Adjudicating Authority) Rules, 2016 stating therein that no disciplinary proceedings are pending against the named IRP. This I.A. No. 137/JPR/2019 is hereby allowed along with this CP. No. (IB)- 24/9/JPR/2019.

The consequences of initiation of CIRP shall be inter alia are as follows: -

Accordingly, this CP. No. (IB)- 24/9/JPR/2019 is admitted.