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ARTICLE · 28 DECEMBER 2020

NCLAT Holds Lease Rentals As ‘Operational Debt'

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Recently, in Anup Sushil Dubey v. National Agriculture Co-operative Marketing Federation of India Ltd, the NCLAT dealt with the issue "Can lease rentals arising out of use and occupation...

IndiaInsolvency/Bankruptcy/Re-Structuring
Yashika Sarvaria
Yashika Sarvaria
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Recently, in Anup Sushil Dubey v. National Agriculture Co-operative Marketing Federation of India Ltd,1   the NCLAT dealt with the issue "Can lease rentals arising out of use and occupation of a cold storage unit be categorized as 'operational debt' under Section 5(21) of I&B Code?"

Section 5(21) of IBC states that "Operational debt" means a claim in respect of the provision of goods or services including employment or a debt in respect of the payment of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority.  

Facts

NAFED/Operational Creditor and the Corporate Debtor entered into a Leave and License Agreement for the usage of cold storage facilities for a period of three years on 01.10.2015. The Agreement stated that the license fee of Rs. 9,31,000/- shall be paid on the 7th day of every month with an increase of 10% in the monthly fee on or after the expiry of 12 months. It

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