Background
A petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 was filed seeking initiation of the Corporate Insolvency Resolution Process (CIRP) against a corporate debtor for default in repayment of operational dues amounting to over ₹11 crore. The claim arose from unpaid invoices for supply of goods and fabrication services rendered between 2014 and 2018. Despite repeated follow-ups, the dues remained unpaid. The operational creditor had also issued a statutory demand notice under Section 8 on 26.02.2020, which was met with no response or dispute from the debtor.
The case had earlier been dismissed as infructuous due to the debtor being subject to a different CIRP at the time. However, following the withdrawal of that process, the present petition was restored for consideration.
Arguments
The operational creditor presented evidence including multiple email correspondences and a corporate guarantee dated 18.08.2017, clearly acknowledging the debt. It was also pointed out that the corporate debtor had neither made any payments nor raised a pre-existing dispute regarding the outstanding dues. The total amount claimed exceeded the ₹1 crore threshold required under Section 4 of the IBC, making the petition maintainable.
Conclusion
After reviewing the materials on record, the Tribunal held that the operational debt was valid and undisputed, and that the statutory conditions for initiating CIRP under Section 9 were met. Accordingly, the petition was admitted, CIRP was initiated, and a moratorium under Section 14 of the Code was imposed. The case underscores the importance of acknowledgment of debt and timely response to statutory demands under the IBC framework.