If a creditor receives a money decree in its favor, then it can either file an execution petition under The Code of Civil Procedure, 1908 (‘CPC’) or file a CIRP application under Section 7/Section 9 of the IBC. The corporate debtor will have to pay money irrespective. Are both options equally valid and permissible?
In Anjani Technoplast Ltd v Shubh Gautam 2026 INSC 410, the Supreme Court objected to the decree holder not filing an execution petition and instead filing a petition under Section 7 of the IBC. Especially, when the quantum of debt was disputed, the corporate debtor was a solvent and functioning company which had expressed its willingness to pay the amount that was lawfully due. Only in limited circumstances, a Section 7 CIRP application may be permitted as indicated in Dena Bank v C. Shivakumar Reddy (2021) 10 SCC 330.