The National Company Law Appellate Tribunal (NCLAT) of New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), rendered a significant ruling in the case of Chandrashekhar Exports Pvt. Ltd. v Babanraoji Shinde Sugar & Allied Industries Ltd. This decision addresses the maintainability of a Section 9 petition under the Insolvency and Bankruptcy Code (IBC) in relation to a claim for compensation penalty arising from a contract.
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The appeal pertained to the dismissal of a Section 9 petition filed under the IBC, where the basis of the claim was a compensation penalty associated with a contract. The NCLAT upheld the dismissal, underscoring that the determination of whether a compensation penalty claim has reached a state of crystallization falls within the purview of a competent court, rather than the Adjudicating Authority.
This ruling emphasizes the necessity of distinguishing the jurisdiction of the Adjudicating Authority and other competent courts in matters that involve the adjudication of claims arising from contracts. The NCLAT’s stance underscores that the complexities surrounding the crystallization of claims for compensation penalties necessitate a comprehensive examination by the appropriate judicial forum.
