https://www.taxtmi.com/caselaws?id=761565 NCLAT held that a security deposit made by a tenant under a lease deed constitutes operational debt, not financial debt. The tribunal found that the deposit lacked essential elements of financial debt under Section 5(8) of IBC, as it was not disbursed against consideration for time value of money but was merely an advance for premises use. The deposit qualified as operational debt since it related to services provided. The resolution professional was directed to reclassify the appellant from "Other Creditor" to "Operational Creditor" status, allowing substitution of Form-C with Form-B. Appeal disposed. en-us Fri, 08 Nov 2024 00:00:00 +0530 Tue, 12 Nov 2024 12:22:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=761565 NCLAT held that a security deposit made by a tenant under a lease deed constitutes operational debt, not financial debt. The tribunal found that the deposit lacked essential elements of financial debt under Section 5(8) of IBC, as it was not disbursed against consideration for time value of money but was merely an advance for premises use. The deposit qualified as operational debt since it related to services provided. The resolution professional was directed to reclassify the appellant from "Other Creditor" to "Operational Creditor" status, allowing substitution of Form-C with Form-B. Appeal disposed. Case-Laws IBC Fri, 08 Nov 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=761565