In the matter of MEGA PROCESS TECHNOLOGY PRIVATE LIMITED

ORDER Per: Sh, Prabhat Kumat, Hon'ble Member (ludicial) is filed by Balaji Formalin Private Limited' 1. The instant application (..Petitioner,lOperationalCreditor'')underSectiongofthelnsolvencyand Bankruptry Code, 2016 ("Code") with a prayer to initiate Corporate lnsolvenry Resolution Process ('CIRP") against Mega Process Technology Private Limite d ("Respondent/Corporate Debtor") for non-payment of Operational Debt of Rs' 1,26,96,800/- (Indian Rupees One Crore Twenty-Six Lakhs Ninety Thousand Eight Hundred Only), inclusive of IGST of 18% payable' Brief-facts about the csse: 2'TheOperationalCreditor,BalajiForm"linPrivateLimitedisaNon.Government, Pdvate Company, Limited by shares incorpor ated on 29 0l '2002 under Companies Act, 1956 having registered offrce at T.F. - 302, Dev Arc, opp' Big Bazar, Nr' Fun Republic, S.G. Highway, Satellite, Ahmedabad' Gujarat' India' 380052' The Operational creditor is involved in providing services such as project identification and local assistance for specialized projects' The Corporate Debtor, Mega Process Technology Private Limited is a Non- 3 Government, Private Company, Limited by shares incorporated on 20 03'2014 under Companies Act, 2013 having registered office at Flat No 40l & 402' 4th Floor' Bavdhan S.No.20/3/2/5 & 20/3/2/6' Anubhut iAp e, Maharashtra, ineering and India,411 021. The Corporate Debtor is engaged supplying of process plant and machinery' .h .+

IN THE NATIONAT COMPAI{Y I-AW TRIB UNAL MUMB AI SPECIAL COLIRT- I c.P. (rB)/690 (MB)m24

Submissions made b! the Petitiorer:

4. The Corporate Debtor had engaged the Operational Creditor for services of project identif,rcation and local assistance for a diary project of Panchmahal District Co-operative Milk Producers Union Limited (PDCMPUL) vide association agreement dated 03. 10.2015. As per the association agreement the Operational creditor would be paida 5ok commission ofthe order value as consideration fortheservices provided.

5. The Operational Creditor asserts that the said services were duly rendered and invoices against the same were duly raised on 23.01.2018. The Operational Creditor submits that the Corporate debtor assured the payment of the said outstanding commission from time to time, however till date, the Corporate Debtor hasn't paid the amount. Hence according to the invoice dated 23.01.2018, the aggtegate amount of 1,261 96,800/- (Indian Rupees One Crore Twenty-Six Lakhs Ninety Thousand Eight Hundred Only) remains unpaid.

6. The Operational creditor submits that the default has occurred on 23.01.2018. The Operational creditor asserts that the amount has been acknowledged by the Corporate debtor by giving a Balance confirmation ofthe years 2017 -18, 2020-21 and 2021-22- The Corporate debtor upon continued default of payment had served a Demand Notice under Sec. 8 ofthe Insolvency and Bankruptcy Code ("Code") by way ofForm 3 & 4 provided in Rule 5 ofthe Insolvency and Bankruptcy (Application to Adjucating Authority) Rules, 2016 dated 22.03.2024. The Corporate debtor in reply to the Demand Notice shared email correspondence on 01.04.2024 requesting for an extension of the payment deadline to repay the outstanding amount which is given as follows: "We have informed you that there were intemal management problems in our company and we are unable to functiot prcperly as a result We assure you are we are fully committed to you a ttres. Btfi please understand that due to prolonged intemal v?1a signiftcant ?r;

IN THE NATIONAI COMPAI{Y IAW TRIBUNAL MUMBA] SPECIAL COL'RT-T c.P. (rB)/6e0 (MBl mu financial coflstraints that have severely impacted our ability to fulfl our paytneft obligatiots within the previously expected time frames. The current financial crkb, caused by unforeseen circumstances, has put 4 strain on our liquidity and has compelled us to reassess our immediate Jinancial commitments. We have done business with you for long time and we urge you in recognition of the long standing mutual trust afld undentanding, to kindly refrain from any legal actions whbh will spoil our long standing relationship. We kindly request your understanding and support duing thb challenging peiod. We req est an ertension of the paynent deadline, allowing us additional time to stabilizz our financial situation andfulfil our obligations to you. We assure you of our sincere intention to resolve this matter. lVe believe that through " mutual underctanding and cooperation, we can overcome this temporary setback 7. The Operational Creditor submits that the Corporate Debtor has not disputed its obligation to pay the remaining outstanding dues till date. Additionally, the response to the Demand Notice dated 22.03.2024 shared by the Corporate Debtor stating the inconvenience to repay the outstanding amount and the letter dated 14.04.2021 shared by the Corporate debtor to the Operational Creditor requesting for an extension for the repayment period citing financial instability during COYID lockdown period serves as an acknowledgment ofthe debt. Sabmissions maile b! the Resoondent: 8. The Corporate debtor have filed their affidavit in rep1y, which was submitted before this Bench as hard copy on 22.70.2024 wherein the Respondents have submitted that the Corporate Debtor has been facing severe internal financial difficulties over an extended period which have arisen due to operational and management disruptiors resulting in the company's liquidity being seriously impact Corporate \ fir l\ i'{,1 debtor has consistently maintained transparent comm with erational i:\' Creditor assuring that the all the outstanding amounts ulil beffiu so as the hy -orr'!O

IN THE NATIONAI COMPAI{Y TAW TRIBUNAL MI]MB AI SPECIAL COURT-I c.P. (tB) /690 (MB)202l financial siruation improves. The Corporate debtor asserts that these assurances were given in good faith with the full intention of resolving the outstanding obligations.

9. The CorporateDebtor citingtheglobal pandemic COVID-19 reportsthat the financial situation of the Corporate Debtor aggtavated leading to significant decline in their abiliry to meet its financial obligations. During the continuance of these f,rnancial constraints the Corporate debtor had shared a letter dated 14.04.2021 requesting the Operational Creditor from refraining from taking any legal proceedings had seek extension for the repayment of the outstanding amount.

10. The Corporate Debtor further submits that despite their assurances and requests the opaational creditor had issued the Demand notice dated 22.03.2024 seekjng immediate payment of the outstanding amounts. The corporate debtor had through email correspondence dated 01.04.2024 informed the Operational Creditor about their financial crisis again along with a request to extend the Iepayment timeline to one and half years but the Operational Creditor not heeding to their Iequest have moved forward with this company petition. Findings: 11. Heard learned Counsel for Petitioner and Respondents. Perused the documents on record.

12. This Bench vide order dated 03.10.2024, had directed the Respondents to file and place on record Affidavit in Reply before the adjoumed date that is on 23.10.2024. The counsel for the Respondents had appeared on 23.10.2024 and placed on record the hard copy of the affidavit in reply. During the hearing the counsel for the respondent stated that "they aren't shying away fro'n pawefit of the atnount to the Operational creditor and require one and halfyear for thetepa ch heard the Counsel for Petitioner and Respondent and proceeded Petition in .LY tams of the material available on record. d$ Y>d

IN THE NATIONAI COMPAI\TY I-AW TRIBUNAL MUMBAI SPECIAL COURT-I c.P. (rB)/6e0 (lMB)mu

13. This Beach in the same order dated 03.10.2024had directed the Operational creditor and Designated Registrar to sewe Notice upon the Corporate Debtor intimating the next date of hearing and to place compliance Report & Ajfidavit of service respectively before the adjourned date.

14. The Bench vide order dated 03.10.2024 had also directed the Operational Creditor to ensure that the copy of the present Company Petition be served upon the Insolvenry and Bankruptcy Board of India ("IBBI") and Affidavit of service with regard to the same is also available on record. In compliance to the same and perusal of the material on record, the operational creditors have served IBBI and a document containing the screenshot of the same is provided along with the Company Petition 15. Upon perusal of the records it is seen that the date of default is not explicitly stated in the IU certificate or provided in Part 4 of the Company petition. while, the first date of default as perthe Companypetition is 23.01.2018, which is the date of default when the payment of the invoice was due. The amount has been acknowledged by the corporate debtor by giving a balance confirmation in 2017 -18 arrd again in 2020-21 and 2021-22. Additionally, the operational creditor has placed on record 2ledger accounts of the operational Creditor in the books of the Corporate Debtor for the year ending 31.03.2021 and 31.03.2022 which can alone be taken as an acknowledgment of debt by the corporate debtor. Thereafter, ot 14.04.2027 the corporate debtor had shared a letter requesting the operational creditor for ext ension of repayment of the outstanding amount Hence, upon the combined reading of the letter dated |4.04.2021, the ledger accounts for the financial year ending M arch 2021 andMarch2)22,theBalanceconfirmationandthereplyemailtotheDemandNotice by the operational creditor dated 01.04.2024 rt cleatty shows that there is an acknowledgement of debt by the Corporate Debtor'

16. It is trite law that that the default date for invoice is to be ideration and (lt limitation with reference to date of default is to be to urpose of 5.' Limitation. The invoice raised for payment was of o-iit ak1 t due on ,Itf r,Jr,l' \ t" ,1.t .','$ . l'

IN THE NATIONAL COMPAI{Y LAW TRIB I.'NAL MUMBAI SPECIAL COURT-I c.P. (rB)/6e0 (MB) 202

23.01.2018 and so is the first date ofdefault, but since there is an acknowledgement in the books of account of the Operational creditor by way of ledger statements provided until M arch 2022, the period to be calculated under Limitation extends for a period of 3 years from that date. Therefore the petition is maintainable and not barred by limitation.

17. It clearly shows that the Respondeat is in default of a debt due and payable, and the default is in excess of minimum amount stipulated under section 4(l) of the IBC, at the relevant time. Therefore, the default stands established and there is no reason to deny the admission ofthe Petition. Inviewof this, this AdjudicatingAuthorityadmis this Petition and orders initiation of CIRP against the Corporate Debtor.

18. The Petition bearing CP (IB) No. 690 of 2024 frled by Balaji Formalin P vate Limited, the Operational Creditor, under section 9 of the Code read with Rule 6(1) of the Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016 for initiating Corporate Insolvency Resolution Process against Mega Process Technology Private Limited, the Corporate Debtor, is Admitted.

19. There shall be a moratorium under Section 14 of the IBC, in regard to the following:

t. The irctitution of suits or continuation of pending suits or proceedings againg the Coryorate Debtor including execution of any judgment, decree or order in any couft of law, tibunal, arbitration panel ol other zuthoity; fi, Trarcfening, encumbering, alienating or disposing ofby the Corporate Debtor any ofits assets or any legal ight or benefcial interest therein; ltt, Any action to foreclose, recoter or enforce arry secuity inteftst ffeated by tlrc Corporate Debtor in respect of its property including atly action under tla Secuitbation and Reconstruction of Financial of h Security Interest (SARFAESI) Act, 2002; q{iAIY (,r t. ffi tl. The recovery of any properly by an owrcr It occupied by or in possession ofthe Coryorate btor. e9 ?,

IN THE NATIONAI COMPAIIY I.AW TRIBL'NAL MIJMB AI SPECIAL COI.'RT- 1 fl*+iH#E sjsJ-g"$ft c.P. (B)/6e0 (:l}'[B)ma H##E at{g*# ' Notwithstanding the above, duing the peiod of moratoium: The vpply of essential goods or senices to the cotporate debtor, if continuing, L shall not be terminated or suspended or it terrupted duing the trroratoium peiod; tt. That the pro sions of Sub-Section ( 1) of Section 14 of the IBC shall flot apply to such transactions as may be notifed by the Central Govemnent in consultation with any sectoral regulator;

20. The moratorium shall have effect from the date of this order till the completion of the CIRP or until this Adjudicating Authoriry approves the resolution plan under Sub- Section (1) of Section 31 of the IBC or passes an order for liquidation of Corporate Debtor under Section 33 of the IBC, as the case maybe.

21. Public announcement of the CIRP shall be made immediately as specified under Section 13 ofthe IBC read with Regulation 6 of the Insolvency & Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

22. Ms. Dipti Amit Thite, having Registration No. IBBI/IPA-002/ IP- N0 1087 /2021- 2022/ 13629 and Email Id: staffdiptithite@gmail com is hereby appointed as the Interim Resolution Professional (IRP) of the Corporate Debtor to carry out the functions as mentioned under IBC. The IRP shall carry out functions as contemplated by Sections 15, 17, 18, 19,20 and 21 ofthe IBC. The fee payable to IRP/RP shall be comptant with Regulations, Circulars and Directions issued by the Insolvenry & Banlcuptcy Board of India (IBBI) as may be applicable'

23. During the CIRP Period, the management of the Corporate Debtor shall vest in the IRP or, as the case may be, the RP in terms of Section 17 of the IBC. The offrcers and managers of the Corporate Debtorshall provide all documents in their possession and furnish every information in their knowledge to the IRP od of one week from the date of receipt of this Order, in default of EOer s will follow. The Operational Creditor shall deposit a sum of 3, s, u'p hree Lakh .,hg .,n,

IN THE NATIONAL COMPAI{Y LAW TRIBUNAL MUMBAI SPECIAL COURT-I c.P. (rB)/690 (MB)mU only) with the IRP to meet the expenses arising out of issuing public notice and inviting claims. These expenses shall be treated as interim advance to fund the CIRP cost which shall be subject to approval by the Committee of Creditors (CoC). However, it is clarified that this amount shall be treated as interim finance for treatment under CIRP.

24. The Registry is directed to communicate this Order to the Operational Creditor, the Corporate Debtor and the IRP by Speed Post and email immediately, and in any case, not later than two days from the date of this Order.

25. A copy of this Order be sent to the Registrar of Companies, Mumbai, Maharashtra, for updating the Master Data of the Corporate Debtor. The said Registrar of Companies shall send a compliance report in this regard to the Registry of this C ourt within seven days from the date of receipt of a copy of this order.

sd./- sd/- Sh. Prabhat Kumar Sh. Justice V.G Bisht Member CfechnigaD Member (Judicial) /lJ/

Certified True Copy l jr$Y L., Copy issup,.l' t fi l c & g o o fc ! o L sf 0n tRJ I .,*)" t\?0\ t+T <} fri Derr'ry tlepisira r tir 14l Nadonrl Ccmp:rny Trr5unal Mumbai Bench