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2020 (8) TMI 537 - AT - Insolvency and BankruptcyMaintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - time limitation - HELD THAT - In the present case, the Corporate Debtor by its letter dated 18th March, 2016/ 20th March, 2016 has specifically stated that it will make an effort in reducing their outstanding dues and raise other funding to save their Bank account from getting NPA - the period of limitation stands shifted to the date on which the Corporate Debtor agreed to pay and thus, we hold that the Application under Section 7 of the I B Code was not barred by limitation. There is nothing on the record to suggest that with regard to the same very debt, M/s Chamber Constructions Pvt. Ltd. had issued any guarantee. The Appellant has enclosed certain Bank Guarantee, which has been issued by certain individual. Therefore, the Appellant has failed to make out a case to get relief in terms of decision of this Appellate Tribunal in DR. VISHNU KUMAR AGARWAL VERSUS M/S. PIRAMAL ENTERPRISES LTD. 2019 (2) TMI 316 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI . Appeal dismissed.
Issues Involved:
1. Limitation of the Application under Section 7 of the Insolvency and Bankruptcy Code, 2016. 2. Maintainability of a second Application under Section 7 of the I&B Code for the same set of claims against a different guarantor. Detailed Analysis: Issue 1: Limitation of the Application under Section 7 of the Insolvency and Bankruptcy Code, 2016 The Appellant contended that the Application under Section 7 of the I&B Code was barred by limitation, as the date of default and declaration of NPA was 31st December 2014, making the Application time-barred by 31st December 2017. The Application was filed in 2019, hence beyond the prescribed period of limitation. The Respondent countered that the Application was not barred by limitation due to an acknowledgment of debt by the Corporate Debtor in April 2016. The Hon’ble Supreme Court’s judgments in "B.K. Educational Services Private Limited vs. Parag Gupta and Associates" and "Vashdeo R. Bhojwani vs. Abhyudaya Co-operative Bank Limited" were cited, affirming that the Limitation Act, 1963 applies to applications under Sections 7 and 9 of the Code from its inception, and Article 137 of the Limitation Act is applicable. The Tribunal referred to several Supreme Court judgments, including "Jignesh Shah and another vs. Union of India and another," which clarified that the limitation period for filing a winding-up petition under Section 433(e) of the Companies Act, 1956 is triggered by the date of default in payment of the debt. Further, in "Gaurav Hargovindbhai Dave vs. Asset Reconstructions Company (India) Limited and another," the Supreme Court held that the right to sue accrues when a default occurs, and if the default occurred more than three years prior to filing the application, it would be barred by limitation unless Section 5 of the Limitation Act is applied to condone the delay. However, the Tribunal noted that under Section 18 of the Limitation Act, the period of limitation is extended if the debtor acknowledges the debt in writing before the expiration of the prescribed period. In this case, the Corporate Debtor’s letter dated 18th March 2016 acknowledged the debt and agreed to make efforts to repay, thereby shifting the limitation period. The Tribunal concluded that the Application under Section 7 was not barred by limitation as the acknowledgment of debt in March 2016 extended the limitation period. Issue 2: Maintainability of a Second Application under Section 7 of the I&B Code for the Same Set of Claims Against a Different Guarantor The Appellant argued that the Corporate Insolvency Resolution Process (CIRP) had already been initiated against another guarantor, M/s Chamber Constructions Pvt. Ltd., for the same set of claims, and hence, the second Application was not maintainable. The Tribunal examined the evidence and found no record suggesting that M/s Chamber Constructions Pvt. Ltd. had issued any guarantee for the same debt. The Appellant presented certain Bank Guarantees issued by individuals, which did not substantiate the claim that the same debt was guaranteed by M/s Chamber Constructions Pvt. Ltd. The Tribunal referred to its decision in "Dr. Vishnu Kumar Agarwal v. Piramal Enterprises Ltd.," and found no merit in the Appellant’s plea. Consequently, the appeal was dismissed. Conclusion: The Tribunal dismissed the appeal, holding that the Application under Section 7 of the I&B Code was not barred by limitation due to the acknowledgment of debt by the Corporate Debtor in March 2016. Additionally, the Tribunal found no evidence to support the claim that a second Application for the same debt against another guarantor was not maintainable. The appeal was dismissed with no costs.
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