2023 (9) TMI 964 - AT - Insolvency and Bankruptcy

Proxy of Corporate Debtor - two separate entities - whether any admission or communication sent by SNG Developers Ltd. can be considered as being sent by Corporate Debtor SNG Techno Build Pvt. Ltd.? - time limitation - HELD THAT - It is amply clear from the various communications and e-mails between the contractors/sub-contractors with the group companies of SNG Group that the use of the e-mail address or Letter head of SNG Developers Ltd was being used in loose sense and it would not be proper to draw any inference from such e-mails that SNG Developers Ltd did not possess any authority to communicate on behalf of the Corporate Debtor SNG Techno Build Pvt. Ltd. It is also significant that in every such e-mail or Minutes of Meeting the work of SNG Plaza has been clearly mentioned, and significantly, in the e-mail dated 11.09.2015 which calls upon Luxmi Electricals to submit the final bill of the work, the work relates to the Work Order No. SNG/GM(C)/Plaza/WO/11/460 dated 25.07.2011, which is the Work Order given by the Corporate Debtor SNG Techno Build Pvt. Ltd. to the Luxmi Electricals. Further, the invoices in relation to the R.A. Bills all relate to the same Work Order and the name of the site is clearly mentioned as Electrical Works at SNG Plaza at Gr. Noida - the Work Order dated 25.07.2011 is the genesis of the RA bills and the related operational debt. Time Limitation - HELD THAT - It is clear that the dues payable between 01.10.2012 and 31.03.2015, remain at Rs. 8,54,593/- as no payments were made during this period. Thus, the operational debt gets limitation of three years from 1.10.2012, i.e., upto 30.09.2015. Within this period there is admission in Balance Sheet for the year ending 31.3.2016 wherein the due operational debt upto 31.3.2015 is included as Rs. 8,54,593/- - the work seemed to have been abandoned or stopped and upon a request by the Corporate Debtor vide e-mail dated 11.09.2015, the final bill was sought from the Operational Creditor. After the e-mail dated 11.09.2015, the final bill was submitted by the Operational Creditor on 24.03.2018. This final bill was granted approval by the Corporate Debtor vide e-mail dated 09.04.2018 (at Pg. 213 of the Appeal Paper Book) which is again admission of the operational debt by the Corporate Debtor. None of these facts have been controverted by the Corporate Debtor. The limitation of operational debt due was upto 23.3.2021 (i.e. 3 years from the issue of Final Bill on 24.3.18). The Section 9 Application was filed within three years of the extended limitation of 23.3.2021. In such a situation, it is clear that the Section 9 Application was filed within limitation. The Impugned Order does not suffer from any error - Appeal dismissed.

Summary

Issues Involved:
1. Whether the certificate of payment and emails issued by SNG Developers Ltd. amount to admission of 'Operational Debt' by the Corporate Debtor.
2. Whether the 'Operational Debt' is time-barred.

Summary:

Issue 1: Admission of 'Operational Debt'
The Appellant argued that the certificate of payment dated 28.01.2012 and emails dated 05.07.2012 and 11.09.2015 were issued by SNG Developers Ltd., a third party, and not by the Corporate Debtor, SNG Techno Build Pvt. Ltd. The Respondent countered that SNG Developers Ltd. was coordinating the project work and any admission by them should be considered as valid admission by the Corporate Debtor. The Tribunal noted that the work order dated 25.07.2011 was issued by SNG Vardhman Techno Build Pvt. Ltd. (later SNG Techno Build Pvt. Ltd.) and that various communications and emails indicated that SNG Developers Ltd. was coordinating the project. Thus, it concluded that the emails and communications from SNG Developers Ltd. related to the same project and should be considered as admissions by the Corporate Debtor.

Issue 2: Limitation of 'Operational Debt'
The Appellant contended that the operational debt was time-barred as the work order was issued on 25.07.2011 and the final bill was submitted on 24.03.2018. The Respondent argued that the balance sheet for the years ending 31.03.2015 and 31.03.2016 showed the amount as 'Trade Payable,' thus extending the limitation period. The Tribunal found that the operational debt was acknowledged in the balance sheet and through various communications, extending the limitation period to 23.03.2021. The Section 9 Application was filed within this extended period, making it within the limitation.

Conclusion:
The Tribunal concluded that the Impugned Order did not suffer from any error and dismissed the appeal, finding it devoid of merit. No order as to costs.