# In the matter of Ex-Servicemen's Multipurpose Services (India) Private Limited CP No. 1638-IBC-NCLT-MB-MAH-2017

> NCLT judgment dated 2018-06-04. Citation: TCN-2018-NCLT-01335. The petition was filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, read with…

- **Court:** NCLT
- **Order date:** 4 Jun 2018
- **Citation:** TCN-2018-NCLT-01335
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ex-servicemens-multipurpose-services-india-private-limited-cp-no-1638-ibc-nclt-m-09fcb515

## Summary

### Background

The petition was filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, by Archit Kaushal, an Operational Creditor, against Ex-Servicemen's Multipurpose Services (India) Private Limited, the Corporate Debtor. The petitioner claimed a default in payment of salary and difference in salaries. The petitioner had furnished Form No. 5 under Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules 2016 in the capacity of Operational Creditor on 23rd November, 2017.

## Facts

Archit Kaushal, the Operational Creditor, filed a petition against Ex-Servicemen's Multipurpose Services (India) Private Limited, the Corporate Debtor, under Section 9 of the Insolvency and Bankruptcy Code, 2016, claiming a default in payment of salary and difference in salaries. The total principal amount in default was stated to be Rs. 19,89,563. The petitioner was appointed as a GM Operations on 21.12.2009 by the Respondent Company. The details of the outstanding amounts included reimbursement of difference in salary from January 2010 to August 2011 (Rs. 4,04,000), reimbursement of difference in salary from October 2011 to March 2012 (Rs. 1,27,200), reimbursement of unpaid salary for a period of 9 months (Rs. 5,27,040), Ex-Gratia Performance bonus for 9 years of

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## Issues and analysis

### Issue 1: Whether the nature of the debt is an 'Operational Debt' as defined under section 5(21) of the …

**Ratio:** Section 5(21) of the Insolvency and Bankruptcy Code, 2016 defines 'Operational Debt' as a

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**Reasoning:** The court considered the facts presented by the Operational Creditor and determined that

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**Interpretation:** The court interpreted Section 5(21) of the Insolvency and Bankruptcy Code, 2016

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**Application:** The court applied the definition of 'Operational Debt' to the facts of the

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## Parties

- **Judges:** M.K. Sh…; Bhaskara Pantula…
- **Appellants:** Archit Ka…
- **Respondents:** Ex-Servicemen's…

## Timeline

- **2009-12-21 — Appointment of…**: Petitioner appointed as GM…
- **2017-09-22 — Demand Notice…**: Petitioner issued a Demand Notice…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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