December 22, 2021
In this case, the OC filed an application under Section 9 of the Code seeking initiation of CIRP against the CD on the ground of failure of payment of employment dues. The tribunal noted that the Employment Agreement between the parties stated that any dispute or controversy arising out of the agreement would be resolved by Arbitration according to the Arbitration and Conciliation Act, 1996.
The tribunal held that the party must exhaust the alternative remedy available by virtue of the agreement(s) and knock at the doors of the judiciary as the last resort. In the present case, as per the agreement, both the parties agreed to settle the issue by resorting to the Arbitration and Conciliation Act, 1996. Thus, the Petitioner cannot selectively choose to insist payment in terms of the agreement, without invoking provisions of alternative remedy. The tribunal noted that “it is a settled position of law that the provisions of the Code cannot be invoked to settle the dispute(s) or to recover the alleged outstanding amount.”
Further, the tribunal held that “the mere acceptance of the debt in question by the Respondent would not automatically entitle the Petitioner to invoke the provisions of the Code, unless the debt and default is undisputed and proved it to the satisfaction of the AA.” Disposing off the petition, the tribunal directed the Respondent to settle the issue amicably, failing which, the Petitioner would be at liberty to invoke the arbitration clause. It further held – if the Petitioner is further aggrieved by the proceedings passed during arbitration, it can invoke appropriate remedy.
Full text of the order accessible here.
We talk to Dr. M. S. Sahoo, the IBBI Chairperson and the flag-bearer of the Indian insolvency and restructuring industry, on a variety of issues.July 12, 2021
IBC16 invites submissions from students for blog posts exclusively covering the NCLT and NCLAT judgments from the months of May & June 2021. (NO REGISTRATION FEES) For the first time, we are trying to introduce a bottom-up approach to scholarship on judicial decisions. The judgments from the higher judiciary tend to attract most of the […]June 29, 2021
Summaries of the noteworthy orders passed by the various NCLT benches in IBC matters.June 14, 2021
The Insolvency Law Committee, in its October 2018 Report on Cross Border Insolvency (‘ILC Report’) has recommended the insertion of Part Z to the Insolvency and Bankruptcy Code 2016 (‘IBC’) as the framework for Cross-Border Insolvency, modelled after the UNCITRAL Model Law on Cross-Border Insolvency Resolution. The Central Government had entrusted the task to propose […]November 26, 2021
Chennai Bench Valuation Report Only to Assist the CoC in Taking a Commercial Decision: Dr Vijay Radhakrishnan v. CS Bijoy P Pulipra, RP PVS Memorial Hospital Pvt Ltd The Appellant was a consultant doctor at the Corporate Debtor hospital, and sought the rejection of the recommended resolution plan and of the valuation report by the […]July 11, 2021