NCLT Ahmedabad holds that Sales Incentive Property Promise Not Operational Debt Under IBC
By COMMUNICATION COMMITTEE Posted On : July 13, 2026
The Ahmedabad Bench of the National Company Law Tribunal (NCLT) in Green Consultancy v. Jhaveri Spices Private Limited [C.P.(IB)/122(AHM)2026] has held that a claim arising from a sales incentive scheme promising transfer of immovable property does not constitute an "operational debt" under the Insolvency and Bankruptcy Code, 2016, and therefore cannot form the basis of an application under Section 9 of the Code. The Court observed that an incentive linked to achievement of sales targets is in the nature of a reward or bonus and does not constitute a debt due and payable for goods or services, even if the sales targets have been achieved.
The Petitioner’s claim was essentially a claim for specific performance of a contractual obligation and cannot be pursued through the insolvency resolution process under Section 9 of the IBC. While dismissing the petition, the court also observed that a claim arising from a contractual promise to transfer immovable property under a sales incentive scheme is not an "operational debt" within the meaning of Sections 5(20) and 5(21) of the IBC, as it does not arise from the provision of goods or services.