Requests For Time Or Settlement Does Not Amount To Pre-Existing Dispute Under IBC: NCLT Mumbai
The National Company Law Tribunal at Mumbai has held that requests for time, settlement, or proposals for alternative arrangements does not amount to a dispute under the Insolvency and Bankruptcy Code and therefore do not negate an admitted liability.
A coram of Judicial Member Nilesh Sharma and Technical Member Sameer Kakar, in an order dated January 12, said such communications far from raising a genuine dispute, often reinforce acknowledgement of debt.
“A request for time, settlement discussions, or proposals for alternative arrangements do not constitute a “dispute” under the IBC and hence, do not negate the admitted liability.”, the tribunal observed.
Under a Share Purchase Agreement dated February 8, 2025, Atum Capital agreed to sell 50,000 unlisted shares of National Stock Exchange of India Ltd to InCred Value Plus for Rs. 7.95 crore. The entire consideration was paid in February 2025. However, only 28,500 shares were transferred between April and May 2025. For the remaining 21,500 shares, Atum Capital repeatedly admitted its inability to deliver and undertook to refund the balance amount.
The tribunal noted that between April and June 2025, the debtor sent multiple emails and WhatsApp messages acknowledging its liability, seeking time to perform and even issuing a post-dated cheque in May 2025 which was later dishonoured.
Rejecting the defence of a pre-existing dispute, the tribunal relied on settled precedents to hold that mere requests for extension of time, negotiations, or settlement proposals do not amount to a dispute under the IBC. It said the issuance of a post-dated cheque also amounted to acknowledgment of the debt.
Since the liability was admitted, unpaid, and no real dispute existed, the tribunal admitted the petition, declared a moratorium, and appointed AAA Insolvency Professionals as the resolution professional. It directed Incred Value to pay Rs. 3 lakhs towards CIRP costs.
Case Title: Incred Value Plus Pvt Ltd vs Atum Capital Pvt Ltd
Case Citation: 2026 LLBiz NCLT (MUM) 44
Case Number: CP (IB)/894/MB/2025
For Applicant: Advocates Rohan Rajadhyaksha, Varuna Bhanrale, Gaurav Jain, Tanya Hasija, Dhaval Bhothra, Mihir Dalwai i/b Trilegal
For Respondent: Advocates Chaitri Kashyap, Yashita Bhardwaj i/b MZM Legal LLP