BHARTI AIRTEL LIMITED Vs. VIJAYKUMAR V. IYER

JUDGEMENT

(1.) The present appeals raise an interesting question on the right to claim set-off in the Corporate Insolvency Resolution Process, when the Resolution Professional proceeds in terms of clause (a) to sub-sec. (2) of Sec. 25 of the Insolvency and Bankruptcy Code, 2016[1] to take custody and control of all the assets of the corporate debtor.

(2.) In order to decide the issue raised in these appeals, we are required to refer to the facts in brief:

(3.) Set-off in generic sense recognises the right of a debtor to adjust the smaller claim owed to him against the larger claim payable to his creditor.[10] Philip R. Wood[11] calls it a form of payment. Palmer[12] notes a distinction between set-off as in accounting, and set-off as a defence. The former focuses on the practical effect of set-off which results in discharge of reciprocal obligations, while the latter focuses on set-off pleaded as a defence to a claim, albeit not as a sword.