Operational debt under IBC must arise from goods, services, employment, or statutory dues to sustain Section 9 proceedings.

An application under Section 9 of the Insolvency and Bankruptcy Code was held not maintainable because the applicant bank did not qualify on the facts as an operational creditor and its claim did not amount to operational debt. The Tribunal applied Sections 5(20) and 5(21), noting that operational debt must arise from supply of goods or services, employment, or statutory dues payable to a governmental authority. As the claim did not fit any of those categories, the essential jurisdictional ingredients for Section 9 proceedings were absent. The application was therefore dismissed in limine.

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Issues: Whether the applicant bank could maintain an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 by showing that it was an operational creditor and that the claimed amount was an operational debt.

Analysis: Under Section 9, a creditor can invoke the insolvency process only if the claim falls within the statutory definition of operational debt. Section 5(20) confines an operational creditor to a person to whom such debt is owed, while Section 5(21) limits operational debt to claims arising from provision of goods or services, employment, or statutory dues payable to governmental authorities. The claim in the present case did not arise from any supply of goods or rendition of services by the applicant to the corporate debtor, nor from an employment relationship, nor from dues payable to a government or local authority. The Tribunal therefore found that the essential jurisdictional ingredients for proceeding under Section 9 were absent.

Conclusion: The application under Section 9 was not maintainable and was dismissed in limine.

Ratio Decidendi: A Section 9 insolvency application is maintainable only where the claimant falls within the statutory definition of operational creditor and the debt qualifies as operational debt under Section 5(21); a claim unsupported by supply of goods or services, employment, or statutory dues cannot sustain such proceedings.

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