Reliance Value Services Private Limited Vs Vees Properties Limited (NCLT Chennai)
NCLT Chennai held that petition under section 7(5) of the Insolvency and Bankruptcy Code, 2016 [IBC] is admitted as financial debt and default thereon is proved by the Financial Creditor. Accordingly, CIRP of Corporate Debtor admitted.
Facts- This petition under section 7 r/w Rule 4 of the Insolvency and Bankruptcy Code, 2016 (IBC) has been filed by Reliance Value Services Private Limited, Financial Creditor against Vees Properties Limited, the Respondent / Corporate Debtor for initiating Corporate Insolvency Resolution process (CIRP) against the Respondent.
Conclusion- The scope of powers vested upon this Tribunal under Section 7(5) of IBC, 2016 was further explained by the Hon’ble Supreme Court in the case of E S Krishnamurthy and Ors. v. Bharath Hi Tech Builders Pvt. Ltd. (Civil Appeal No. 3325 of 2020). It was held that Section 7(5) of IBC, 2016, prescribes only two courses for the Adjudicating Authority. The Tribunal can admit the application if debt and default are established and the application is complete. Alternatively, the Tribunal is at liberty to reject the application if debt and default are not established, the application is incomplete, or the proposed Resolution Professional is facing disciplinary proceedings before the IBBI.
