Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Insolvency and Bankruptcy Code exercising powers u/s.7 or s.9 is not a debt collection forum 2016 – ss.7-9 – Held: NCLT |
Content Type | Text |
Resource Type | Law Order |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Insolvency and Bankruptcy Code, 2016 – ss. 7-9 – Held: NCLT, exercising powers u/s.7 or s.9, is not a debt collection forum – IBC tackles and/or deals with insolvency and bankruptcy – It is not the object of the IBC that Corporate Insolvency Resolution Process (CIRP) should be initiated to penalize solvent companies for nonpayment of disputed dues claimed by an operational creditor – There are noticeable differences in the IBC between the procedure of initiation of CIRP by a financial creditor and initiation of CIRP by an operational creditor – On a reading of ss. 8 and 9, it is patently clear that an Operational Creditor can only trigger the CIRP process, when there is an undisputed debt and a default in payment thereof – If the claim of an operational creditor is undisputed and the operational debt remains unpaid, CIRP must commence, for IBC does not countenance dishonesty or deliberate failure to repay the dues of an Operational Creditor – However, if the debt is disputed, the application of the Operational Creditor for initiation of CIRP must be dismissed – In the present case, there was a pre-existing dispute with regard to the alleged claim of the appellant-Operational Creditor against HPCL (respondent no.1) or its wholly owned subsidiary HBL – Adjudicating Authority (NCLT) clearly fell in error in admitting the application filed by the appellant u/s.9 as Operational Creditor, for initiation of the CIRP against HBL – NCLAT rightly allowed the appeal filed on behalf of HBL – No grounds to interfere with the impugned judgment of the NCLAT. |
Judge | N/A |
Neutral Citation | 2022 INSC 1309 |
Petitioner | M/s S.s. Engineers |
Respondent | Hindustan Petroleum Corporation Ltd. & Ors. |
SCR | [2022] 18 S.C.R. 391 |
Judgement Date | 2022-07-15 |
Case Number | 4583 |
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