Mr. K Sridhar and Mr. K. Murali are the Directors of M/s S & M Engineering Enterprises Limited (SMEEL). Unfortunately, being the victims of COVID 2019 pandemic, by both the brothers and their respective families, the

As per the provisions of the Insolvency and Bankruptcy Code, 2016 the procedure followed in the decision-making process by the Adjudicating Authority admitting the application filed by the assignee of an Operational Creditor is explained in detail below: 'Default' means non-payment of debt when whole or any part or instalment of the amount of debt has become due and payable and is not paid by the debtor or the corporate debtor, as the case may be [Section 3(12)]. 'Operational Creditor' means a person to whom an operational debt is owed and includes any person to whom such debt has been legally assigned or transferred; [Section 5(20)]. An Operational Creditor who has assigned or legally transferred any operational debt to a Financial Creditor, the assignee or transferee shall be considered as an Operational Creditor to the extent of such assignment or legal transfer. (Cooperative Rabobank U.A. Singapore Branch Vs. Shailendra Ajmera [CA (AT) (Ins.) No. 261 of 2018] NCLAT judgement dated 29.04.2019) Therefore, assignee also falls in the definition of Operational Creditor. Serving a Demand Notice: On occurrence of default, an operational creditor shall first send a demand notice and a copy of the invoice to the Corporate Debtor. On receipt of demand notice by the Corporate Debtor: The Corporate Debtor shall, within a period of 10 days of the receipt of the demand notice or copy of the invoice bring to the notice of the operational creditor about: existence of a dispute about the debt, if any, or record of the pendency of the suit or arbitration proceedings filed before the receipt of such notice or invoice in relation to such dispute. the payment of an unpaid operational debt: it is possible that the corporate debtor might have already paid the unpaid operational debt. In such a situation, corporate debtor will inform within 10 days: by sending an attested copy of the record of the electronic transfer of the unpaid amount from the bank account of the corporate debtor or by sending an attested copy of a record that the operational creditor has en-cashed a cheque issued by the corporate debtor [Section 8(2) (b) (ii)]. If no reply is received or payment or notice of the dispute under Section 8(2) from the corporate debtor within 10 days from the date of delivery of the notice or invoice demanding payment, the operational creditor can file the application before the Adjudicating Authority (NCLT) for initiating a CIRP as per Section 9 of the Code. Section 21 (5) provides that where an operational creditor has assigned or legally transferred any operational debt to a financial creditor, the assignee or transferee shall be considered as an operational creditor to the extent of such assignment or legal transfer. Thus, based on the afore-mentioned provisions, the decision made by the Adjudicating Authority of admitting the application filed by the 'Assignee' of an operational creditor is Valid as an operational creditor also includes a person to whom such debt has been assigned.