2022 (3) TMI 1062 - AT - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - time limitation - HELD THAT - The copy of the Application filed under Section 9 by the Appellant has been brought on the record where under Part-IV, it has been clearly mentioned that debt fell due on 30.12.2016. Application was filed beyond three years from the date when debt fell due. The submission which has been pressed by the Appellant is regarding extension of limitation by virtue of the e-mails dated 26.03.2017 and 27.04.2017. The mere fact that the e-mail was received that the matter shall be looked into. The use of exact words I have asked Mahesh to look into your case on priority and I am hopeful you will have a resolution soon . The above expression cannot be read any acknowledgment within the meaning of Section 18. Subsequent mail which is of 27.04.2017 which is written by one of the employees of the Corporate Debtor at Page 45 of the paper book cannot be treated to be acknowledgment by the Corporate Debtor within the meaning of Section 18 by the Corporate Debtor - Explanation (a) to Section 18 has no applicability in the facts of the present case nor any benefit can be claimed by the Appellant on the basis of explanation (a). The Application filed under Section 9 by the Appellant could not have been entertained and has been rightly rejected by the Adjudicating Authority - appeal dismissed.

Summary

Issues:
- Appeal against rejection of Application under Section 9 of the Insolvency and Bankruptcy Code, 2016 on the ground of being time-barred.

Analysis:
1. The appeal was filed against the rejection of an Application under Section 9 of the Insolvency and Bankruptcy Code, 2016, by the Adjudicating Authority on the basis of being time-barred. The Appellant, an Operational Creditor, claimed to have joined the Corporate Debtor on 20.11.2015 and remained an employee until 28.02.2017. The Adjudicating Authority rejected the Application stating that it was beyond the limitation period as the date of default mentioned was 30.12.2016, and the Application was filed on 13.03.2020, exceeding the 3-year limitation under Article 137.

2. The Appellant argued that the limitation period got extended due to acknowledgments received via emails dated 26.03.2017 and 27.04.2017. However, the Tribunal noted that the emails did not contain acknowledgments accepting the debt within the meaning of Section 18 of the Limitation Act. The content of the emails did not constitute an acknowledgment as they merely indicated a review of the case without admitting the debt.

3. The Tribunal further examined the submissions regarding the explanation to Section 18 of the Limitation Act. The Appellant referred to explanation (a) of Section 18, which deals with the sufficiency of acknowledgment even if it omits to specify the exact nature of the property or right. However, the Tribunal found that explanation (a) had no applicability in the present case, and the Appellant could not claim any benefit based on it.

4. Ultimately, the Tribunal concluded that the Application filed under Section 9 could not be entertained due to being time-barred and upheld the decision of the Adjudicating Authority to reject the Application. The Tribunal found no error in the impugned order and dismissed the appeal.

This detailed analysis highlights the key arguments presented, the Tribunal's evaluation of the evidence, and the legal reasoning behind the decision to dismiss the appeal due to the time-barred nature of the Application under the Insolvency and Bankruptcy Code, 2016.