Whether the provisions of Section 10A of IBC stand attracted to an application under Section 9 of IBC?

This Supreme Court judgement addresses whether Section 10A of the Insolvency and Bankruptcy Code (IBC), which prevents the initiation of insolvency proceedings for defaults occurring on or after 5 June 2020, applies to applications filed under Section 9. The Court examined if this provision could render an operational creditor's application non-maintainable. The case involved a claim for a significant sum due to the appellant following his resignation from his role as Chairman and Managing Director.

Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

Civil Appeal No. 4050 of 2020

Ramesh Kymal .... Appellant

Versus

M/s Siemens Gamesa Renewable Power Pvt Ltd. .... Respondent

J U D G M E N T

Dr Dhananjaya Y Chandrachud, J

1 The appellate jurisdiction of this Court under Section 62 of the Insolvency and Bankruptcy Code, 2016 (“IBC”) has been invoked to challenge the judgement and order of the National Company Law Appellate Tribunal (“NCLAT” or “Appellate Tribunal”) dated 19 October 2020. The NCLAT affirmed the decision of the National Company Law Tribunal (“NCLT” or “Adjudication Authority”) dated 9 July 2020, holding that in view of the provisions of Section 10A, which have been inserted by Act 17 of 2020 (the “Amending Act”) with retrospective effect from 5 June 2020, the application filed by the appellant as an operational creditor under Section 9 was not maintainable.

2 Some of the salient facts set out in the appeal are being adverted to in order to indicate the broad contours of the controversy. The issue involved raises a question of law. Hence, while setting out the facts as set up in the appeal, we need to clarify that the factual dispute has not arisen for adjudication.

3 The appellant claims that a sum of INR 104,11,76,479 is due and payable to him pursuant to his resignation “from all capacities held by him in the respondent in accordance with the various Employment Agreements/Incentive Agreements” entered into by him with the respondent during his tenure as Chairman and Managing Director. The appellant entered into an Employment Agreement with the respondent on 16 July 2009. Another Employment Agreement was entered into on 16 December 2013, effective from 1 January 2014, which superseded the previous agreement. The Employment Agreement dated 16 December 2013 was coupled with an Incentive Agreement signed on the same date. The Incentive Agreement is stated to have been amended and restated on 17 April 2015, along with a further amendment through a Side Letter dated 20 April 2015. Further, the new Employment Agreement was amended through a Letter Amendment No. 1 dated 17 April 2015.

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