9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (9) TMI 711 - SC - Insolvency and BankruptcyAdmissibility of application - initiation of CIRP - Repayment of loan granted - cause of limitation continuing - applicability of time limitation - Section 23 of the Limitation Act. HELD THAT - It is clear that when the Recovery Certificate dated 24.12.2001 was issued, this Certificate injured effectively and completely the appellant s rights as a result of which limitation would have begun ticking - his being the case, and the claim in the present suit being time barred, there is no doubt that is due and payable in law. Appeal allowed.
Issues:
1) Application of Limitation Act to the case 2) Interpretation of Section 23 of the Limitation Act 3) Effect of a continuing wrong on limitation Analysis: 1) The case involved a default of &8377; 6.7 Crores by respondent No.2, leading to a Recovery Certificate issued in 2001. A Section 7 petition was filed in 2017, admitted by NCLT in 2018, and dismissed by NCLAT in the same year. The issue of limitation arose, with the appellant arguing that no limitation period would apply due to the continuing default. The Supreme Court referred to a previous judgment and held that the right to sue accrues when a default occurs, and if the default is over three years old, the application would be barred under Article 137 of the Limitation Act unless Section 5 is invoked to condone the delay. 2) The appellant contended that Section 23 of the Limitation Act should save the limitation in this case. However, the Court referred to a precedent stating that Section 23 applies to a continuing wrong, not a continuing right. The judgment clarified that a continuing wrong creates a continuing source of injury, making the doer liable for the injury's continuation. In this case, the Recovery Certificate in 2001 effectively and completely injured the appellant's rights, triggering the limitation period. 3) The Court concluded that the claim in the present suit was time-barred, as the Recovery Certificate in 2001 marked the beginning of the limitation period. Citing the injury caused by the Certificate, the Court allowed the appeal, setting aside the orders of NCLT and NCLAT. The judgment emphasized that the amount due was undisputed and payable in law, with no costs awarded.
|
