The Supreme Court has upheld the decision of the National Company Law Tribunal (NCLT) in Indus Biotech Private Limitedv. Kotak India (Offshore) Fund & Ors, by holding that applications under section 7 of the Arbitration and Conciliation Act, 1996 are only admissible after the dispute between the parties is settled through arbitration. Relying on section 7(5) of the Insolvency and Bankruptcy Code, and previous SC judgements, the NCLT held that the adjudicating authority must be satisfied that a default exists in order for an application to be allowed. The NCLT held that the existence of default in this case could not be ascertained until it was determined whether Indus had defaulted in its obligation to pay the redemption value to Kotak India. The NCLT and Supreme Court both found that Kotak could not initiate proceedings under section 7 while a dispute regarding the valuation of its already initiated process to convert the Optionally Convertible Redeemable Preference Shares persisted.