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Informative

Operational Creditor Can Only Trigger CIRP Process When There Is An Undisputed Debt And Default In Payment: NCLAT

Update / Judgement Date

13 Mar 2025

Source

Taxscan

Author

Team — WCP Legal Desk

Reading Time

1 min read

Insolvency & Bankruptcy CodeOther Legal Matters

The NCLAT Principal Bench has ruled that an operational creditor can only trigger the CIRP process for an undisputed debt default in payment. The tribunal emphasized the need for clear evidence of debt default. This decision protects the rights of debtors. The ruling clarifies the requirements for initiating CIRP.