Non-maintainability of application u/s 7 as transaction was in nature of ‘Operational Debt’ and not ‘financial debt’

Varun Gupta Vs ISINOX Pvt. Ltd. (NCLAT Delhi)

Conclusion: Admission of application under Section 7 of the Insolvency and Bankruptcy Code, 2016 was not maintainable as the transaction constituted an ‘operational debt’ and not  a financial debt, therefore, the same was not covered under Section 5(8)(e) but was governed by Section 5(20) and Section 21(5) of the Code.

Held: A petition under Section 7 of the Code was filed by Somesh A Naik & 44 others claiming an amount of 4,37,14,449/- out of which Rs. 2,34,17,965/- was the principal a

Please become a Premium member. If you are already a Premium member, login here to access the full content.