The NCLAT held that the statutory protection granted to ...

NCLAT upholds denial of payment to operational creditors when liquidation amount is nil.

Case Laws     IBC

September 23, 2024

The NCLAT held that the statutory protection granted to operational creditors u/s 30(2)(b) of the IBC is that they shall not receive less than the specified amounts. The appellant's case did not fall u/s 30(2)(b), as the issue raised was covered by a recent NCLAT judgment in Rajat Metaal Polychem Pvt. Ltd. vs. Mr. Neeraj Bhatia and Anr. The Tribunal ruled that operational creditors are denied payment when the liquidation amount is nil, and until the legislature amends the scheme, courts cannot take any other view. Consequently, the appeal was dismissed.

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