2017 (4) TMI 1271 - Tri - Insolvency and Bankruptcy

Corporate insolvency procedure - eligibility of claim - Notice given by the Corporate Debtor relating to the dispute of the unpaid Operational Debt in terms of Section 9 (3)(b) of the Code - Held that - A perusal of the documents on record, reflect that the invoices raised are for the period 01.04.2013 to 19.09.2013 for the services rendered. The present proceedings have been initiated on 29.03.2017, i.e. after a period of three years from the last invoice raised. Ld. Counsel for the Operational Creditor has failed to satisfy this Bench as to how this claim is legally recoverable being beyond the period of limitation. He seeks to rely on cheques tendered by the Corporate Debtor for enhancing the limitation, having been given in acknowledgement of the outstanding liability and in a bid to reduce the same. There is no difficulty in accepting the proposition that tender of a cheque would be an acknowledgment of a debt, but for the fact, that the cheques in this case are dated 31.01.2014 and 07.02.2014. The limitation as such can only be construed from 07.02.2014. As the petition was filed on 29.03.2017, it is clearly beyond the enhanced period of limitation. The claim being time barred, cannot be termed as a legally recoverable debt. In view of the same, the petition cannot be entertained and is liable to be dismissed.

Summary

Issues:
1. Petition under section 9 of the Insolvency and Bankruptcy Code, 2016 for corporate insolvency resolution.
2. Failure of the 'Operational Debtor' to remit amounts for services rendered.
3. Notice served under section 8 of the Code returned with endorsement "Refused."
4. Lack of dispute raised by the Corporate Debtor regarding the unpaid Operational Debt.
5. Absence of payment confirmation from the Corporate Debtor in the Operational Creditor's account.
6. Claim filed beyond the period of limitation.
7. Legal recoverability of the debt in light of the limitation period.

Analysis:
The petitioner initiated a petition under section 9 of the Insolvency and Bankruptcy Code, 2016, seeking corporate insolvency resolution against the 'Operational Debtor,' M/S. PTC Techno Pvt. Ltd., due to non-payment of services provided. Invoices were issued for services rendered between April and September 2013, totaling ?24,18,273.36, inclusive of Central Sales Tax. Despite serving a notice under section 8 of the Code, the Corporate Debtor failed to respond, with the notice being returned as "Refused." The petitioner submitted an affidavit confirming no dispute raised by the Corporate Debtor and provided a certificate from ICICI Bank showing non-receipt of payment for the Operational Debt. The application also included consent from an insolvency professional and 123 invoices as evidence.

The documents revealed that the invoices were raised for services provided from April to September 2013, with the petition filed in March 2017, exceeding the three-year limitation period. The petitioner's counsel attempted to extend the limitation period based on cheques tendered by the Corporate Debtor, but the cheques were dated in early 2014, making the claim time-barred. Acknowledging that a cheque can acknowledge a debt, the Tribunal noted that the limitation period could only be extended from the date of the cheques, rendering the claim beyond the legally recoverable debt timeframe.

Consequently, the Tribunal dismissed the petition under section 9 of the IBC, citing the claim as time-barred and legally unrecoverable. No costs were awarded in the judgment.