https://www.taxtmi.com/caselaws?id=418003 The SC allowed the appeal and reversed the NCLAT's decision dismissing the CIRP application. The Court held that the appellant qualified as an operational creditor under Section 5(20) of the IBC, as the debt arose from advance payment made for supply of goods/services that remained unpaid after contract termination. The Court ruled that operational creditors include those providing or receiving operational services that lead to operational debt, interpreting "in respect of" in Section 5(21) broadly. Regarding debt realization, the respondent's MOA stated its object was taking over the Proprietary Concern, but the purported Board resolution declining takeover lacked compliance with Section 13 of Companies Act 2013 for MOA amendment, rendering it legally ineffective. The Court found the Section 9 application was not time-barred, as the cause of action arose when the Proprietary Concern finally refused repayment in March 2017, not when the advance was initially paid in 2013. en-us Fri, 04 Feb 2022 00:00:00 +0530 Wed, 16 Jul 2025 18:32:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=418003 The SC allowed the appeal and reversed the NCLAT's decision dismissing the CIRP application. The Court held that the appellant qualified as an operational creditor under Section 5(20) of the IBC, as the debt arose from advance payment made for supply of goods/services that remained unpaid after contract termination. The Court ruled that operational creditors include those providing or receiving operational services that lead to operational debt, interpreting "in respect of" in Section 5(21) broadly. Regarding debt realization, the respondent's MOA stated its object was taking over the Proprietary Concern, but the purported Board resolution declining takeover lacked compliance with Section 13 of Companies Act 2013 for MOA amendment, rendering it legally ineffective. The Court found the Section 9 application was not time-barred, as the cause of action arose when the Proprietary Concern finally refused repayment in March 2017, not when the advance was initially paid in 2013. Case-Laws IBC Fri, 04 Feb 2022 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=418003