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Deals & Matters |
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29 May 2026 |
The Firm successfully represented its Client operating in the upstream oil & gas project management space (Operational Creditor) before the Hon’ble National Company Law Tribunal, Mumbai Bench, in proceedings under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC). The Tribunal admitted the petition and initiated the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, affirming the existence of a clear operational debt and default.
The matter arose from long-outstanding dues payable to our Client for services rendered in the oil and gas sector, including civil works, project management consultancy, logistics, and allied support services. Despite repeated demands and partial repayments, the Corporate Debtor failed to discharge its admitted liabilities, leading to the initiation of insolvency proceedings.
The dispute was made complex by the existence of a settlement agreement, under which the parties had agreed upon a structured repayment mechanism. The Corporate Debtor sought to rely on this agreement to contend that the nature of the claim had been altered and that no operational debt subsisted to invoke the provisions of IBC.
A central aspect of the matter involved addressing multiple defences raised by the Corporate Debtor, including:
The Firm demonstrated that the Settlement Agreement merely consolidated and crystallised the admitted dues without altering the character of the debt being an operational debt. The team further established a consistent pattern of acknowledgements of liability and part payments by the Corporate Debtor, thereby negating the existence of any genuine dispute.
Accepting the Firm’s submissions, the Hon’ble Tribunal undertook a detailed examination of the judicial precedents and the IBC framework inter alia held that:
The Hon’ble Tribunal’s Order reinforces critical jurisprudence under the Insolvency and Bankruptcy Code on the treatment of settlement agreements and the evidentiary threshold for establishing operational debt. It inter alia clarifies that structured repayment arrangements do not dilute the underlying liability, and that technical defences cannot defeat an admitted claim. The ruling further underscores the limited scope of defences available to corporate debtors in Section 9 proceedings under the Code, particularly where there is a demonstrable record of acknowledgment and default.
An Appeal was filed by the Corporate Debtor before the National Company Law Appellate Tribunal (NCLAT), Principal Bench, which was also rejected by the Appellate Tribunal.
Kochhar & Co. provided end-to-end counsel on strategy, contractual interpretation and ensuring effective enforcement of the Client’s rights under the IBC framework.
The Kochhar & Co. team comprised of Mayur Shetty (Partner), Rushil Mathur (Associate Partner) and Yash Pitroda (Senior Associate).
