# Sunil Kumar Jain and others Vs. Sundaresh Bhatt and others, Civil Appeal No. 5910 of 2019

> SC judgment dated 19 Apr 2022. Citation: TCN-2022-SC-00055. The appellants, who are workmen and employees of M/s ABG Shipyard Limited (Corporate Debtor),…

- **Court:** SC
- **Order date:** 19 Apr 2022
- **Citation:** TCN-2022-SC-00055
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/sunil-kumar-jain-and-others-vs-sundaresh-bhatt-and-others-civil-appeal-no-5910-o-91d5fd1a

## Summary

### Background

The appellants, who are workmen and employees of M/s ABG Shipyard Limited (Corporate Debtor), challenged an order dated May 31, 2019, passed by the National Company Law Appellate Tribunal (NCLAT), New Delhi. The NCLAT had dismissed their appeal, which sought relief regarding their claims for salary during the Corporate Insolvency Resolution Process (CIRP) and the period prior to it. The NCLAT's decision upheld an earlier order from the National Company Law Tribunal (NCLT), Ahmedabad Bench, Ahmedabad (Adjudicating Authority), dated April 25, 2019, which had not granted them the requested relief.

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## Facts

The appellants are 272 workmen and employees of M/s ABG Shipyard Limited, the Corporate Debtor, working at its Dahej Yard and Mumbai Head Office. The Corporate Debtor was a private sector shipbuilding yard with manufacturing activities at Dahej and Surat, Gujarat, and a corporate office in Mumbai. Prior to the initiation of the Corporate Insolvency Resolution Process (CIRP), the Corporate Debtor employed 562 workmen and 93 employees at Dahej, 291 workmen and 99 employees at Surat, and 101 employees at its Mumbai Head Office.

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## Issues and analysis

### Issue 1: Whether the wages and salaries of workmen/employees during the Corporate Insolvency Resolution…

**Ratio:** Wages and salaries of workmen/employees during the CIRP period are to be included in the…

**Reasoning:** The Court reasoned that for wages and salaries to be included in CIRP costs, two…

**Interpretation:** The Court interpreted Section 5(13) of the IBC, which defines 'insolvency…

**Application:** In the present case, there were disputed questions of fact regarding whether…

## Parties

- **Judges:** M.R.…; ANIRUDDHA…
- **Appellants:** Sunil Kumar Jain…
- **Respondents:** Sundaresh Bhatt…
- **Other parties:** 7th Edition…; CIRP C…; +13 more
- **Advocates:** For the appellants…; For the respondent…

## Timeline

- **August 1, 2017 — CIRP Init…**: The Adjudicating Authority admitted an application under Section 7 of the IBC Code, and…
- **September 4, 2017 — First COC M…**: The first meeting of the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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