Whether the Guaranteed Minimum Royalties to be paid quarterly by the Corporate Debtor as a consideration to grant of license and right to use the Trademark of the Operational Creditor on its Licensed Product (for manufacture and sale purpose) is an Operational Debt or not? – Knight Riders Pvt. Ltd. Vs. Global Fragrances Pvt. Ltd. – NCLT New Delhi Bench Court-IV
Adjudicating Authority drew conclusion as per the judgment Vikas Sales Corporation vs. Commissioner of Commercial Taxes AIR 1996 SC 2082 and held that incorporeal rights like trademarks, copyrights, patents and rights in personam capable of transfer or transmission are included in the ambit of “goods”. Further having considered the facts and circumstances and the material available on record the Adjudicating Authority is of the view that that for a claim to fall within the definition of ‘operational debt’, the operational creditor must establish that it has a “right to payment” “in respect of the provision of “goods or services” and also that Corporate Debtor has committed a “default” towards its “liability or obligation in respect of such outstanding claim”. The Adjudicating Authority also placed it reliance on the judgment Broadcast Audience Research Council V. Mi Marathi Media Limited (2021) ibclaw.in 150 NCLT.
