A sum of money which is certainly and in all events payable is a debt, without regard to the fact, whether it is payable immediately or at a future date – Mr. G. Balasubramaniam Vs. Indian Overseas Bank – NCLAT Chennai
May 1, 2023
NCLAT held that a Financial Creditor, under the Code, is an individual, who has a right to Financial Debt. Unlike, the Companies Act, which provides inability to pay Debt, as a ground for Winding up of a Company, the Code, 2016, provides that an action for an Insolvency may be initiated, if default is really / actually committed by a person or the Corporate Debtor. No wonder, an application is not to be turned down, on the basis that, the account of the Corporate Debtor is eligible for Restructuring, in the teeth of Master Circular, of the Reserve Bank of India. In reality, it is not the property, which is at the root of the Code, 2016. Further, a just dispute, about the quantum of payment, does not affect the Right of a Financial Creditor. It is to be remembered that the Cash Liquidity, is only the basis for triggering a CIRP, in the considered opinion of this Tribunal. A sum of money which is certainly and in all events, payable is a debt, without regard to the fact, whether, it is payable immediately or at a future date. The term receivable means any sum, which a person, is entitled to receive or received from another person.