2019 (12) TMI 187 - Tri - Insolvency and Bankruptcy

Time Limitation - initiation of CIRP against Corporate Debtor - whether the claim of the applicant/petitioner is within limitation or barred by limitation? - HELD THAT - In the case in hand, the applicant claims the amount from September, 2014 to May, 2015, therefore, in view of Article 137 of Limitation Act, the person is required to file application within three years, when right accrues to file the claim, but the applicant has not claimed the amount within three years from 30.09.2015, i.e. the date of default and filed this petition on 15.05.2019, which is much after the three years from the date of default. In view of the provision of Article 137 of Limitation Act, this Adjudicating Authority is of the considered view, that the present claim of the applicant/petitioner is barred by Article 137 of Limitation Act - the present petition filed u/s 9 is barred by limitation, thus this petition is not liable to be admitted - the prayer to initiate proceedings under Section 9, read with Sections 13, 14 33 and other applicable provisions of the Insolvency Bankruptcy Code, 2016, against the Corporate Debtor company by the applicant, is hereby rejected - petition dismissed.

Summary

Issues Involved:
Determining whether the claim of the applicant/petitioner is within limitation or barred by limitation under the Insolvency & Bankruptcy Code, 2016.

Detailed Analysis:

Issue 1: Claim of the Applicant
The applicant, an Operational Creditor, filed a petition for the initiation of Corporate Insolvency Resolution Process against the Corporate Debtor, Sahara Prime City Ltd., for unpaid dues from September 2014 to May 2015. The total claimed amount is ?12,49,250.

Issue 2: Limitation Analysis
The Adjudicating Authority considered the limitation aspect based on Article 137 of the Limitation Act. The right to sue accrues when a default occurs, and the application must be filed within three years from that date. In this case, the default date was 30.09.2015, but the petition was filed on 15.05.2019, well beyond the three-year limitation period.

Issue 3: Legal Precedents
The Authority referred to legal precedents, including the Supreme Court judgments in Mithailal Dalsangar Singh v. Annabai Devram Kini and Ram Nath Sao v. Gobardhan Sao. It also cited the relevance of Article 137 of the Limitation Act as per the decisions in B.K. Educational Services (P.) Ltd. v. Paras Gupta & Associates and Gaurav Hargovindbhai Dave v. Asset Reconstruction Co. (India) Ltd.

Conclusion:
Based on the analysis, the Adjudicating Authority concluded that the applicant's claim was time-barred under Article 137 of the Limitation Act. As a result, the petition filed under Section 9 of the Insolvency & Bankruptcy Code, 2016, was deemed barred by limitation and rejected. The petition CP No.(IB)168/ALD/2019 was dismissed, and proceedings against the Corporate Debtor, Sahara Prime City Ltd., were not initiated.