Miss Lucy
← All judgments

K. G. Rajasekaran vs Alectrona Energy Pvt. Ltd

National Company Law Appellate Tribunal20 November 2019

Ratio decidendi

The rule this decision rests on

An application under Section 9 of the Insolvency and Bankruptcy Code, 2016 for initiation of corporate insolvency resolution process may be rejected where the operational creditor fails to place on record any specific document establishing the existence of the debt, and does not disclose the quantum claimed for each head of its alleged dues. A dismissal of an appeal against rejection of a Section 9 application does not bar the applicant from pursuing the same claim before an appropriate forum for appropriate relief, provided the claim is not barred by limitation.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHICompany Appeal (AT) (Insolvency) No. 1332 of 2019IN THE MATTER OF:

K. G. Rajasekaran ...Appellant

Vs

Alectrona Energy Pvt. Ltd. ....Respondent

Present: For Appellant: Ms. Promila, Advocate. For Respondent:

ORDER

20.11.2019: The Appellant - 'K. G. Rajasekaran', employee of 'M/s

Alectrona Energy Pvt. Ltd.' filed application under Section 9 of Insolvency and

Bankruptcy Code, 2016 (hereinafter referred to as 'I&B Code') for initiation of

Corporate Insolvency Resolution Process against its Employer - 'M/s Alectrona

Energy Pvt. Ltd.' (Corporate Debtor). The Adjudicating Authority (National

Company Law Tribunal), Division Bench Chennai by impugned order dated

29th July, 2019 rejected the application.

2. Learned counsel for the Appellant submits that the application under

Section 9 was rejected in limine. However, we find that the impugned order

was passed after hearing learned counsel for the parties. It appears that the

Operational Creditor's claim - a sum of Rs.31,66,807/- is payable but no

record produced about existence of debt or default. In reply to Section 8(1)

Notice issued on 6th March, 2018, the Corporate Debtor by its reply dated 16th

March, 2018 pointed out number of days Appellant remained absent and

denials to other claims which was against variable pay, leave travel allowance,

etc. which are not the salary.

-3-

3. Having heard learned counsel for the Appellant we find that there is no

specific document relating to debt brought on record and Appellant has not

disclosed anywhere as to how much he is entitled to claim arrears for the years

2016, 2017, 2018 and 2019 and about leave encashment, variable pay, leave

travel allowance and other reimbursements. We hold that the Adjudicating

Authority rightly rejected the application under 9 being incomplete. However,

we make it clear that the impugned order dated 29th July, 2019 passed by the

Adjudicating Authority (NCLT), Division Bench, Chennai or this Appellate

Tribunal will not come in the way of the Appellant to mover before appropriate

forum for appropriate relief, if the claim is not barred by limitation. The appeal

is dismissed with aforesaid observation.

[Justice S. J. Mukhopadhaya] Chairperson

[Justice Bansi Lal Bhat] Member (Judicial)

[Justice Venugopal M.] Member (Judicial) am/sk

Company Appeal (AT) (Insolvency) No. 1332 of 2019

This page reproduces a public judgment and a summary of it. It is research material, not legal advice, and it is no substitute for advice from an advocate on your own facts.

Research this judgment with Miss Lucy

Ask what it holds, what has followed it, and what it means for your matter — in plain English, with the citations.

Try Miss Lucy free