In a recent decision, the National Company Law Appellate Tribunal, New Delhi (“NCLAT”) has upheld the maintainability of an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 relating to the component of interest due and payable, without asking for the principal amount which has not yet become due and payable.
This expands the scope of Section 7 IBC proceedings wherein the adjudicating authority can also admit a corporate debtor into CIRP if the financial creditor can establish that there is a default of interest above the prescribed threshold under Section 4, due and payable by the corporate debtor to the financial creditor.
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