Insolvency proceedings can be initiated against a corporate debtor despite contestation of liability when evidentiary support of breach and unpaid debts exists, irrespective of alleged unauthorized actions by a director.

ORDER

(Hearing conducted through VC)

This petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 {“IBC”) r/w Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 has been filed by Allianz Bulk Carriers DMCC, Operational Creditor / Petitioner herein against A&N Seaways and Projects Private Limited, the Corporate Debtor / Respondent herein for initiating Corporate Insolvency Resolution Process (“CIRP”).

2. Part-I of the petition sets out the particulars of the Petitioner/Operational Creditor, Allianz Bulk Carriers DMCC. It has its address at No.402, Gold Crest Executive, Cluster C, Jumeriah Lake Towers, PO Box 361018, Dubai, UAE. Part-II sets out the details of the Corporate Debtor, A&N Seaways and Projects Pvt. Ltd. It was incorporated on 17.07.2019 with Authorized and Paid-Up capital of Rs.10,00,000/-. Its Registered Address is at New No.97, Old No. 47, Linghi Chetty Street, George Town, Chennai-600 001 within the jurisdiction of this Tribunal. In Part-III, the Petitioner has not proposed the name of any Interim Resolution Professional. Part-IV of the petition contains the particulars of debt i.e. USD 322,622.74, Rs.2,67,77,687.44 and the date of default as 22.09.2023.

3. It is stated that the Petitioner, owner of MV Bharadwaj (IMO No. 9290189), a motor vessel flagged in the Republic of Panama (“Vessel”) had chartered the Vessel to the Corporate Debtor under the Charter Party Agreement (“CPA”) dated 05.07.2023. The Corporate Debtor failed to provide a “no lien / encumbrance” letter to the Operational Creditor in terms of Line 112 of the CPA. The Corporate Debtor also failed to supply bunkers to the Vessel. The Master of the Vessel and the Petitioner during the period from 18.09.2023 to 21.09.2023, repeatedly mailed to the Corporate Debtor to supply the bunkers and voyage instructions to the Vessel but the Corporate Debtor did not provide the same. The Corporate Debtor also failed to pay the port charges to the Visakhapatnam Port Authority. It is stated that because of the above, the Vessel could have been arrested. It is stated that to ensure that the Vessel remains unencumbered, the Petitioner paid these debts on behalf of the Corporate Debtor which the Corporate Debtor was liable to indemnify to the Petitioner. It is stated the Corporate Debtor did not pay any charter hire to the Operational Creditor from 18.07.2023 (at 11.00 hrs. UTC) to 22.09.2023 (at 04.30 hrs. UTC) amounting to the principal operational debt of USD 191,752.12.

4. It is stated that the Corporate Debtor had admitted its liability by remitting the payments to the Petitioner on 31.07.2023, 02.08.2023, 03.08.2023 and 12.08.2023. The Corporate Debtor also issued a letter on 21.07.2023 to the Petitioner admitting its liability to pay the charter hire and informed that the charter hire would be guaranteed by its associate concern, SPG Infrastructures (“SPG”), a partnership firm based in Port Blair. It also confirmed that it would be fully responsible for financial and commercial aspects under the CPA. Similar letter was issued by SPG Infrastructures on 21.07.2023 guaranteeing the payment by the Corporate Debtor in the like-manner. SPG also confirmed that the Corporate Debtor would be fully responsible for the financial and commercial aspects under the CPA.

5. It is stated that on 25.07.2023, the Corporate Debtor through its agent, sent a mail purporting to have transferred USD 25,000 to the P