Case Law Details
Kripa Cashew Exports Vs Royals International Trade And Allied Products Pvt. Ltd. (NCLT)
In the present case, the first point which arises for consideration is whether the debt falls within the purview of Operational Debt under Section 5 (21) of the I&B Code,2016?
To arrive at a decision, this Tribunal has gone through the judgement of Hon’ble National Company Law Appellate Tribunal (‘NCLAT‘) in Jindal Steel and Power Limited v. DCM International Limited, Company Appeal (AT) (Insolvency) No. 288 of 2017, wherein the Appellate Tribunal held as under:
“Admittedly, the Appellant is a tenant of Respondent-‘Corporate Debtor’. Even if it is accepted that a Memorandum of Understanding has been entered between the parties in regard to the premises in question, the Appellant being a tenant, having not made any claim in respect of the provisions of the goods or services and the debt in respect of the provisions of the goods or services and the debt in respect of the repayment of dues does not arise under any law for the time being in force payable to the Central Government or State Government, we hold that the Appellant tenant do not come within the meaning of ‘Operational Creditor’ as defined under sub-section (20) read with sub-section 21 of Section 5 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to ‘I&B Code’) for triggering Insolvency and Bankruptcy Process under Section 9 of the ‘I&B Code’.”
Thus any amount claimed as due by a person representing as ‘Operational Creditor’ should demonstrate firstly that the said amount in default falls within the definition of ‘claim’ as defined in Section 3(6). Such a claim, secondly should be capable of being treated as a ‘debt’ as defined under Section 3(11) of I&B Code, 2016 and finally the ‘debt’ should fall within the confines of Section 5(21) of I&B Code, 2016 (i.e.) it should be capable of being treated as an ‘Operational Debt’ and such an operational debt must be owed by the Corporate Debtor to a creditor who can then be considered as an Operational Creditor as defined under Section 5(20) of IBC, 2016.
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