Shailen S Gala-HUF & Ors. vs Mayurpankh Fine Builders Private Limited

Per V.P. Singh, Member (Judicial)

This is a joint application being CP 1015/2019 filed by Shailen S. Gala-Hindu Undivided Family, along with 8 other Financial Creditors or Applicants, under section 7 of Insolvency & Bankruptcy Code, 2016 (I&B Code) against Mayurpankh Fine Builders Limited, Corporate Debtor, for initiating Corporate Insolvency Resolution Process (CIRP). The application was admitted vide our order dated on 19.09.2019.

Each Applicant has claimed payments and default in repayments as mentioned below:

The Applicants have issued the above cheques to extend financial assistance at an interest rate of 1.25% per month to be repaid on demand. The Corporate Debtor has issued promissory notes dated 14.05.2010 towards the repayment of the amounts extended as loan. assuring to repay the loan amount at an interest rated 1.25% per month. However, the Corporate Debtor has failed to repay the loan amounts from 01.10.2016. The total amount claimed to be in default is ₹67,91,498/- (Rupees Sixty Seven Lakh Ninety One Thousand Four Hundred and Ninety Eight Only). The Applicants have annexed the following documents to establish the debt and default of the Corporate Debtor:

It is observed by this Bench in order dated 13.08.2019, that the Applicant has served copy of the Application along with Court Notice on the Corporate Debtor and an affidavit of service has been filed by the Applicants. The Corporate Debtor was provided sufficient opportunity to file its Reply to the Application. However, the Corporate Debtor has chosen not to file any reply till date. At the time of hearing, the Ld. Counsel appearing for the Corporate Debtor stated that the Application is barred by limitation and is not maintainable.

We have heard the parties and perused the records.

On perusal of the Application and the documents annexed, it is seen that the Applicants have extended financial assistance to the Corporate Debtor vide cheques dated 15.05.2010 as mentioned supra. The Bank statements of the Applicants show transfer of the Cheque amounts to the Corporate Debtor. The Corporate Debtor has issued On Demand Promissory Notes dated 14.05.2010 in respect of the 9 cheques issued as loan to the Corporate Debtor, Further the Corporate Debtor has issued ‘Confirmation of Accounts Letter’ to the Applicants on 01.04.2014 admitting to its liability to repay the debt amount. The promissory notes dated 14.05.2010, Balance confirmation letter dated 01.04.2014 establish the debt, and admitted liability of the Corporate Debtor.

On perusal of the records, it is seen that the Corporate Debtor has paid the TDS on interest from 2012 till May 2017 for the loan amount. Further, on perusal of the 9 Notices dated 05.12.2018 issued by each Applicant demanding a sum of ₹67,91,498/- (Rupees Sixty Seven Lakh Ninety One Thousand Four Hundred and Ninety Eight Only), stating that the Applicant has not received any interest from 01.10.2016. The Corporate failed to pay the amount claimed to be in default. The Corporate Debtor has admittedly not repaid the loan amount and has defaulted from making interest payments since 01.10.2016. The Application having been filed on 04.02.2019, the same is well within the limitation period.

The debt and default amounts being more than a sum of Rupees One Lakh, the application deserves to be admitted.

However, on perusal of the documents submitted on record, there is a debt due and payable by the Corporate Debtor to the Applicant. The outstanding amount that is in default is more than The Applicant has proposed the name of Mr. Arundeep Singh Pathania, a registered insolvency professional having Registration Number [IBBI/IPA-002/IP-N00384/2017-18/11154] as Interim Resolution Professional, to carry out the functions as mentioned under I&B Code. In Form 2 annexed to the Application, the proposed IRP has declared that there are no disciplinary proceedings pending against him.

The Application under sub-section (2) of Section 7 of I&B Code, 2016 filed by the financial creditor for initiation of CIRP in prescribed Form No1, as per the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 is complete. The existing financial debt of more than rupees one lakh against the corporate debtor and its default is also proved. Accordingly, the petition filed under section 7 of the Insolvency and Bankruptcy Code for initiation of corporate insolvency resolution process against the corporate debtor deserves to be admitted.

This petition filed under Section 7 of I&B Code, 2016, filed by Shailen S Gala- HUF & Ors., Financial Creditors or Applicants, against Mayurpankh Fine Builders Private Limited, Corporate Debtor for initiating corporate insolvency resolution process is at this moment admitted. We further declare moratorium u/s 14 of I&B Code with consequential directions as mentioned below:

The Registry is at this moment directed to immediately communicate this order to the Financial Creditor, the Corporate Debtor and the Interim Resolution Professional even by way of email or WhatsApp. Compliance report of the order by Designated Registrar is to be submitted today.