Office Assistant Drags Company Into Insolvency

Office Assistant Drags Company Into Insolvency

The Chennai bench of the National Company Law Tribunal (NCLT) has initiated the corporate insolvency resolution process under the Insolvency and Bankruptcy Code (IBC) against a company based on a petition by an office assistant for non-payment of salary dues amounting to Rs 3.2 lakh.

Office Assistant as an Operational Creditorrot

Pradeep M R, the office assistant, classified as an operational creditor under the IBC, was appointed on July 1, 2011 by Merchem Limited, a manufacturer of specialty chemicals. The last payment of salary to him was made on February 22, 2016 for the month of December 2015. "Thereafter, no payment has been made in the account of the operational creditor," NCLT said.

"The operational creditor has fulfilled all the requirements of law for admission of the application and has also proposed the name of the IRP (interim resolution professional)," NCLT's member, judicial, Ch. Mohd Sharief Tariq, said in his order. "This bench is satisfied that the corporate debtor has committed a default in making payment of the outstanding debt claimed by the operational creditor," he said.

Commencement of CIRP for non-payment of Salary of Rs 3,20,397

"Therefore, (the petition) is admitted and the commencement of corporate insolvency resolution process is ordered, which ordinarily shall get completed within 180 days, reckoning from the day this order is passed," NCLT ruled. Pradeep claimed Rs 3,20,397 on account of services which he had rendered to the company as an office assistant. Though a private notice for service on the corporate debtor (Merchem) was ordered on December 21, 2017, which was served, there was no representation from the corporate debtor, the tribunal said.

"Therefore, the corporate debtor was proceeded ex-parte on January 9, 2018," it said.

Chennai-based C Ramasubramaniam has been appointed as IRP and has been directed to take charge of the management of the company immediately. The NCLT said that the supply of essential goods or services of the corporate debtor should not be terminated, suspended or interrupted during the moratorium period.

Courtesy – Times of India