NCLAT Delhi ruled that a non-supply dispute was sham as documents were provided pre-notice; upheld admission of Section 9 IBC application.
NCLAT: Sham Dispute Cannot Block Section 9 IBC Admission
The NCLAT, Delhi, held that an alleged dispute regarding non-supply of airline agent identification numbers (ADMs) was a sham, as the applicant had already supplied copies prior to the demand notice. The tribunal upheld the admission of the Section 9 IBC application.
In its reasoning, the NCLAT emphasized that disputes must be substantiated with contemporaneous records. Mere assertions without documentary or legal support do not constitute a 'pre-existing dispute' under Section 8(2)(a) of the IBC. The tribunal relied on Macquarie Bank Ltd v. Shilpi Cable Technologies (2020) for the threshold test.
This decision reinforces the pro-creditor stance of the appellate authority. Practitioners advising corporate debtors must assess the factual and evidentiary strength of any claimed dispute before contesting CIRP admissions.
Citations
- Insolvency and Bankruptcy Code, 2016, Section 8(2)(a)
- Macquarie Bank Ltd v. Shilpi Cable Technologies (2020) 6 SCC 293
