NEW DELHI: The National Company Law Appellate Tribunal (NCLAT) has dismissed an insolvency petition against PepsiCo India Holdings after observing that provisions of IBC cannot be turned into a debt-recovery proceeding.The appellate insolvency tribunal has upheld the earlier order passed by the Chandigarh bench of the National Company Law Tribunal (NCLT), which had rejected SNJ Synthetics’s plea.“The adjudicating authority (NCLT) has not committed any infirmity in not allowing the CIRP of the corporate debtor (PepsiCo) to be initiated solely on the basis of the claim of the contested and unsubstantiated interest component,” said a three-member NCLAT bench.The NCLAT held that SNJ’s insolvency petition, filed under Section 9 of IBC as an operational creditor was not maintainable since the principal amount of the debt claimed from PepsiCo had already been repaid and only a disputed claim for interest remained.“The provisions of Insolvency & Bankruptcy Code (IBC) cannot be turned into a debt-recovery proceedings and to commend any such course of action would tantamount to pushing the corporate debtor to face the perils of corporate death instead of being rejuvenated and revived,” NCLAT said in its order passed on May 7, 2025. The NCLAT direction came over a petition filed against the NCLT order.
