Arbitration Clause Does Not Bar Operational Creditors From Filing Section 9 Applications Under IBC: NCLT Mumbai

The National Company Law Tribunal (NCLT) in Mumbai has ruled that the presence of an arbitration clause in a contract does not prevent operational creditors from filing applications under Section 9 of the Insolvency and Bankruptcy Code (IBC). This decision allows operational creditors to seek insolvency resolution despite existing arbitration agreements, ensuring that their rights to recover debts are upheld. The ruling clarifies the interplay between arbitration clauses and the IBC, supporting creditors in pursuing legitimate claims through insolvency proceedings.