Case: – Mr. Atanu Kumar Chatterjee v/s Rolta Defence Technology Systems Pvt. Ltd.; C.P.(IB)-554(MB)/2022
The National Company Law Tribunal (NCLT) Mumbai recently dismissed a petition filed by 29 Operational Creditors against Rolta Defence Technology Systems Pvt. Ltd. This petition sought to initiate a Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor but was deemed non-maintainable by the Tribunal due to not meeting the requisite financial threshold under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC).
The petition, filed under Section 9 of the IBC by the 29 Operational Creditors cited a default in repayment amounting to Rs.3.50 Crores by the Corporate Debtor. These Operational Creditors were former employees of the Corporate Debtor, having served in various capacities and periods.
In its verdict, the NCLT Mumbai highlighted that none of the individuals involved met or fulfilled the essential pecuniary limit of Rs. 1 crore individually required for maintaining a petition under Section 9 of the IBC. Referring to legal precedents like Suresh Narayan Singh v/s Tayo Rolls Ltd. and JK Jute Mill Mazdoor Morcha v/s Juggilal Kamlapat Jute Mills Company Ltd. & Ors. The Tribunal emphasized that while employees (Operational Creditors) have the right to file applications individually or jointly, these judgments don’t advocate joint filings surpassing the financial limit of Rs. 1 Crore for a Section 9 Petition under the IBC.
The Tribunal reiterated its stance by underscoring that the threshold limit for each individual stands at Rs. 1 Crore as mandated by the NCLAT’s findings in Suresh Narayan Singh v/s Tayo Rolls Ltd. and the revised notification dated 24.03.2020, which elevated the threshold limit from Rs. 1 Lakh to Rs. 1 Crore for a valid Section 9 petition under the IBC.
Ultimately, the NCLT concluded that the petition was not maintainable since the individual claims of each Operational Creditor fell below the prescribed threshold limit of Rs. 1 Crore, thereby rendering the collective petition insufficient to meet the pecuniary requirement mandated under Section 9 of the IBC.
Author of this article:
Adv. Ravish Bhatt,
Partner, R&D Law Chambers,
Dual Qualified Lawyer Solicitor | International Tax Affiliate
Connect with Mr. Bhatt on Linkedin: https://www.linkedin.com/in/adit-ravishbhatt/
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