NCLT expands ‘Creditor’ definition, grants company name restoration

The NCLT New Delhi Bench in a significant ruling, held that the term ‘Creditor’ under Section 252 of the Companies Act, 2013, should be construed broadly to include creditors with contingent or prospective debts. 

The Tribunal emphasized that fairness and justice must guide decisions and the presence of the phrase ‘or otherwise’ in Section 252(3) allows for the restoration of a company’s name, even if it was not operational or conducting business at the time of striking off. 

This decision is seen as a move towards ensuring that the law operates in a just and equitable manner, reflecting the evolving nature of creditor rights and corporate law.