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2022 (8) TMI 1114 - AT - Insolvency and BankruptcyInitiation of CIRP - NCLT dismissed the application - Corporate Debtor failed to make repayment of its dues - Operational Creditrs - existence of debt and dispute or not - time limitation - date of default - HELD THAT - The limitation period of an operational debt under IBC will be extended if before the expiration of the 3 years period, an acknowledgment has been made in writing signed by the party against whom such property or right is claimed - In the present case, it is noted that even though the operational creditor sent an e-mail dated 1.6.2016 mentioning the outstanding amount for payment, and debit note was also included in the ledger account dated 31.3.2016, no acknowledgement of the liability has been made in writing by the corporate debtor. In such a situation, the date of default has to be computed from the date of last payment i.e. 4.9.2015 - the three years period shall be over on 3.9.2018 and since the application under section 9 was filed on 4.12.2018, it is clearly beyond the period of limitation and hence is barred as being out of limitation. The Adjudicating Authority has correctly dismissed the section 9 application filed by the Appellant - Appeal dismissed.
Issues Involved:
1. Date of default and its impact on the limitation period. 2. Deemed acknowledgment of debt by the corporate debtor. 3. Application of Section 5 of the Limitation Act for condonation of delay. Detailed Analysis: 1. Date of Default and Limitation Period: The primary issue revolves around determining the date of default. The Appellant claimed the date of default as 1.6.2016, based on an email sent to the corporate debtor regarding overdue payments, which was not replied to, suggesting a "deemed acknowledgment" of debt. Conversely, the Respondent argued that the date of default should be the last payment date, i.e., 4.9.2015. The Adjudicating Authority considered the last payment date of 15.10.2015 as the date of default, and since the Section 9 application was filed on 4.12.2018, it was beyond the three-year limitation period, thus barred by limitation. 2. Deemed Acknowledgment of Debt: The Appellant argued that the absence of a reply to the email dated 1.6.2016 should be considered a "deemed acknowledgment" of the debt. The Appellant cited judgments from the Hon'ble Delhi High Court and Hon'ble High Court of Madhya Pradesh to support the claim that non-repudiation of a legal notice leads to adverse inference. However, the Respondent contended that the debit note dated 31.3.2016 was included to extend the limitation period and was neither accepted nor admitted by the corporate debtor. The Tribunal noted that no acknowledgment in writing was made by the corporate debtor, and thus, the limitation period could not be extended based on the email alone. 3. Application of Section 5 of the Limitation Act: The Appellant argued that even if the application was delayed by three days, the Adjudicating Authority should have provided an opportunity to file for condonation of delay under Section 5 of the Limitation Act. The Respondent countered that it was the operational creditor's responsibility to file such an application, and no fault lay with the Adjudicating Authority for not providing this opportunity. The Tribunal referred to judgments from the Hon'ble Supreme Court, which state that no party can claim condonation of delay without making an application. Since the Appellant did not seek permission to file an application for condonation of delay, the Tribunal found no reason to grant an extension. Conclusion: The Tribunal concluded that the Adjudicating Authority correctly dismissed the Section 9 application as it was filed beyond the limitation period. The Tribunal emphasized that no acknowledgment of debt in writing was made by the corporate debtor, and the Appellant did not file an application for condonation of delay. Consequently, the appeal was dismissed, with no order as to costs.
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