Case Title:- Sandesh Naik v. MT Educare Ltd.

The National Company Law Tribunal, Mumbai while dealing with an application filed u/s 9 of the Insolvency and Bankruptcy Code for initiating Corporate Insolvency Resolution Process (CIRP) against the Respondent to recover an amount of Rs 22,41,735/-, has observed that salary or remuneration due to be paid for the notice period amounts to specific performance of the appointment letter and does not fall within the ambit and definition of 'Operational Debt' as the same was not a salary for the actual work done by the Operational Creditor.

The facts, in brief, are that the Applicant was appointed as a Chief Financial Officer but he resigned from his job and sent multiple emails to the Respondent to release his dues. Subsequently, the Respondent acknowledged his liability and agreed to the full and final settlement of dues owed to the Applicant but took no concrete action to materialise his acknowledgement. Due to this, the Applicant had to issue a demand notice u/s 8 of the Code and in reply to which the Respondent also acknowledged his liability but only to the tune of Rs. 7,26,626/- and sent a cheque bearing the said amount. 

The Applicant however placed his reliance on the Appointment Letter and moved the Adjudicating Authority to claim the balance amount. The stand of the Respondent is that the document relied upon by the Applicant is forged and fabricated. 

After hearing exhaustive submissions from both sides, the Tribunal observed that the amount due as the salary of the alleged notice period does not amount to Operational Debt. It also observed that the main issue between the parties seems to be a dispute in the contents of a document for which section 9 IBC is not the appropriate remedy to be invoked. Accordingly, it dismissed the application and mentioned that the Applicant is at liberty to resort to an appropriate remedy available under the law to settle the matter.