NCLT JUDGEMENT ON SECTION 3(12), 5(21), 8, 8(1), 9 OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016 AND RULE 6 OF THE INSOLVENCY AND BANKRUPTCY (APPLICATION TO ADJUDICATING AUTHORITY) RULES, 2016

NAME		MOBILE NO.	E-MAIL I’D
RANJEET KUMAR		8383098478, 9667769795	rk@courtkutchehry.com
JAI THAKUR		8130703334, 9355723300	jai.thakur@courtkutchehry.com
RAJEEV RANJAN		9334553249	rajiv.ranjan@courtkutchehry.com
ASHOK MISHRA		9718327746	sales@courtkutchehry.com
RAVI KUMAR			ravi.singh@courtkutchehry.com

Nitin Gupta Vs. International Land Developers Private Limited, (2020) 06 NCLT CK 0015

NCLT dismissed the petition filed by the petitioner, under Section 9 of the Insolvency and Bankruptcy Code, 2016 (for brevity 'code') read with Rules 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority), 2016 (for brevity 'the Rules') with a prayer to initiate the Corporate Insolvency process against the Corporate Debtor. While dismissing the petition NCLT held that In the light of that facts when we shall consider the case in hand then we find that the settlement agreement on the basis of which the present application is filed by the applicant does not come under the definition of operational debt. At this juncture we would also like to refer a decision of NCLT Allahabad Bench in "Company Petition (IB) No. 343/ALD/2018 in the matter of M/s. Delhi Control Devices (P) Limited Vs. M/s. Fedders Electric and Engineering Ltd." decided on 14.05.2019, in which the NCLT Allahabad bench held that "unpaid installment as per the settlement agreement cannot be treated as operational debt as per Section 5(21) of IBC. The failure or breach of settlement agreement can't be a ground to trigger CIRP against Corporate Debtor under the provision of IBC 2016 and remedy may lie elsewhere not necessarily before the Adjudicating Authority". In the light of that decision and provision which we have referred in the aforementioned para, when we shall consider the case in hand then we are of the considered view that the case of the applicant is covered with the aforesaid decision, therefore, we are of the considered view that default of installment of settlement agreement does not come within the definition of operational debt, hence, we are not inclined to issue notice rather we are of the view the present application is liable to be rejected. Accordingly, it is therefore ordered that the prayer of the applicant is hereby reject and the applicant stands DISMISSED.