An application by Operational Creditor can be made either in individual capacity or joint capacity.

The Ld. National Company Law Appellant Tribunal further observed that where workmen/employees are ‘Operational Creditors’, the application may be made either by an ‘Operational Creditor’ in an individual capacity or as a joint capacity by one of them who is duly authorized for such purpose.

The said ratio was delivered by the National Company Law Appellant Tribunal in the matter of Mr. Suresh Narayan Singh Vs. Tayo Rolls Limited, CA(AT)(Insolvency) No. 112/2018 decided on 26.09.2018.

Challenge

The limited issue before the Ld. Tribunal was that whether the NCLT, Kolkata was justified in rejecting the application filed by Appellant/ Operational Creditor under Section 9 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as I&B Code 2016) on the ground that the application under Section 9 has to be filed by the ‘Operational Creditor’ individually and not jointly.

Held

The National Company Law Appellant Tribunal set aside the order passed by NCLT, Kolkata and held that Section 5(20) read with Section 5(21) of the I&B Code makes it clear that the workmen of a Company come within the meaning of ‘Operational Creditor’. If Sections 8 & 9 of the I&B Code are read with Form-5, it will be clear that the person authorized to act on behalf of the ‘Operational Creditor’ is entitled to file an application under Section 9. Therefore, where workmen/employees are ‘Operational Creditors’, the application may be made either by an ‘Operational Creditor’ in an individual capacity or as a joint capacity by one of them who is duly authorized for such purpose.

The Tribunal after placing reliance upon “Innoventive Industries Ltd. v. ICICI Bank and Anr. (2018) 1 SCC 407” further observed that if there is a ‘debt’ and there is a ‘default’ which in this case has not been disputed by ‘Tayo Rolls Limited’- (‘Corporate Debtor’), the application being complete, the Adjudicating Authority should have entertained the application, instead of raising a technical ground that it was filed on behalf of 284 workmen.