9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (12) TMI 1488 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - Arbitral Award - Non-performing asset - existence of debt and dispute or not - time limitation - HELD THAT - From the record it is found that initially pursuant to an agreement dated 26th September, 2006 one Arbitral Award was passed by the Hon ble Sole Arbitrator on 27th January, 2014. Subsequently, another award was passed by the Hon ble Sole Arbitrator on 31st March, 2017. Therein apart from the amount of ₹ 7,00,88,809.56/- the Arbitral Tribunal awarded interest @ 18% from the date of award till date of payment by the Respondent or realization thereof. Therefore, if the Appellant intends to rely on the award, it is held that there is no default and thereon application under Section 7 is not maintainable. The Appellant wants execution of award - If it is treated as application under Section 7 for execution of award, in said case it is to be held that the application was filed with malicious intent not for purpose of resolution of insolvency or liquidation. However, no finding is given in case of the Bank and it is held that the application under Section 7 was barred by limitation. While condoning the delay of 13 days in preferring the appeal, the appeal is dismissed on merits.
Issues: Application under Section 7 of the Insolvency and Bankruptcy Code, 2016 dismissed as barred by limitation.
The judgment involves a case where 'HDFC Bank Ltd.' filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 against 'M/s Bhawan Das Auto Finance Ltd.' The National Company Law Tribunal, Kolkata Bench, dismissed the application as being time-barred. The account of the Corporate Debtor was declared a Non-Performing Asset (NPA) by the Bank in 2010, making the application under Section 7 barred by limitation from the date of NPA declaration. The Appellant Bank relied on an Arbitral Award issued in its favor against the Corporate Debtor for a specific sum with interest. The Tribunal noted that there were two Arbitral Awards, one in 2014 and another in 2017, awarding a substantial amount along with interest. The Tribunal held that if the Bank intended to rely on the award, there was no default, and thus, the application under Section 7 was not maintainable. The Tribunal observed that the Bank's application seemed to be for the execution of the Arbitral Award. Referring to Section 65 of the Insolvency and Bankruptcy Code, the Tribunal highlighted provisions related to fraudulent or malicious initiation of proceedings, imposing penalties for such actions. While the Tribunal refrained from finding malicious intent on the Bank's part, it concluded that the application under Section 7 was time-barred, not warranting further consideration. Consequently, the Tribunal, while acknowledging a delay in filing the appeal, dismissed the appeal on merit, holding that the application under Section 7 was barred by limitation. The Interlocutory Application was disposed of accordingly, based on the detailed analysis of the issues surrounding the application under Section 7 of the Insolvency and Bankruptcy Code.
|
