The Tax Publishers 2019 TaxPub(CL) 0165 (NCLAT-Del) : (2019) 151 SCL 0097

 

Sunil Sanghavi v. Cytech Coatings (P.) Ltd.

 

INSOLVENCY AND BANKRUPTCY CODE, 2016

--Insolvency resolution by operational creditor --Appeal against order of initiation of corporate insolvency resolution process Demand notice served at old address --Non-fulfillment of requirement of section 8 --Where operational creditor did not serve the demand notice at the present office address of corporate debtor, said notice could not be said as properly served, therefore, order to initiate corporate insolvency resolution process against corporate debtor was to be set aside.--Adjudicating Authority passed an order to initiate CIRP against corporate debtor. Corporate debtor filed an application for recalling of the said order on the ground that operational creditor did not serve notice under section 8(1) at its present office address, but the same was sent to the address of its earlier office, which was closed. However, Adjudicating Authority rejected the application. Therefore, corporate debtor filed an appeal against the decision. Held: The demand notice under section 8(1) was not a mere formality but mandate of law that such notice was actually served on the corporate debtor. Adjudicating Authority failed to consider that the notice was not served on the valid address of the corporate debtor. Therefore, order to initiate CIRP was set aside.

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