2022 (9) TMI 170 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - pecuniary limit for filing application - time limitation - condonation of delay of 84 days under Section 5 of the Limitation Act, 1965 r/w Section 238A of the, IBC, 2016 - HELD THAT - The Applicant had placed its reliance on the judgment passed by the Hon'ble Supreme Court of India wherein, exclusion was granted in Cognizance for extension of limitation, In 2021 (3) TMI 497 - SC ORDER and the same was followed by the Hon'ble National Company Law Appellate Tribunal, Delhi in Suo-Moto-Competition Appeal 2020 (6) TMI 495 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI for the period from 15.03.2020 till 14.03.2021 - the delay of 84 days in filing the Section 9 Petition is condoned, following the said decision. Reliance placed in the Judgment of Hon'ble NCLAT in the matter of Jumbo Paper Products V. Hansraj Agrofresh Pvt. Ltd. 2021 (10) TMI 1279 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI wherein it was held that statute/law can be applied retrospectively only if explicit provision regarding its retrospective application is made in the statute. It is seen that notification of MCA dated 24.3.2020 makes it unambiguously clear that the threshold limit to be considered for filing application under section 7 or 9 will be Rs. 1 crore. This threshold limit will be applicable for application filed u/s. 7 or 9 on or after 24.3.3020 even if debt is of a date earlier than 24.3.2020. Since the instant application filed under section 9 of the Code which is the subject matter of our consideration was filed on 27.11.2021 and even the statutory demand notice U/s. 8 was sent on 28.10.2021, therefore the pecuniary threshold limit of Rs. 1 crore of debt will be applicable in the present case. Hence, the present Application as not maintainable. Application dismissed.

Summary

Issues:
- Application under section 9 of the Insolvency and Bankruptcy Code for initiation of Corporate Insolvency Resolution Process.
- Condonation of delay in filing the petition.
- Maintainability of the petition based on pecuniary threshold limit.

Analysis:
1. Application under Section 9 of the Insolvency and Bankruptcy Code: The applicant, an operational creditor, filed a petition seeking initiation of Corporate Insolvency Resolution Process against the respondent company, claiming unpaid operational debt. The applicant provided details of the transactions and invoices generated in favor of the corporate debtor. The respondent company did not file a reply before the Adjudicating Authority. The Tribunal considered the application and the provisions of the Code to proceed with the matter.

2. Condonation of Delay: The applicant sought condonation of an 84-day delay in filing the Section 9 petition. The Tribunal examined the delay under Section 5 of the Limitation Act, 1965, and Section 238A of the IBC, 2016. Referring to relevant judgments, including those of the Supreme Court and the National Company Law Appellate Tribunal, the Tribunal allowed the condonation of the delay, citing jurisdiction and precedence.

3. Maintainability based on Pecuniary Threshold Limit: The Tribunal delved into the issue of maintainability of the petition concerning the pecuniary threshold limit. Citing judgments and notifications, including the MCA notification dated 24.3.2020, the Tribunal analyzed the retrospective and prospective application of the threshold limit of Rs. 1 crore for filing applications under Section 7 or 9 of the IBC. Referring to the NCLAT and High Court judgments, the Tribunal concluded that the pecuniary threshold limit applied to applications filed on or after 24.3.2020, rendering the present application not maintainable due to falling below the threshold.

4. Final Decision: Consequently, the Tribunal dismissed the present application under Section 9 of the Code, emphasizing that the pecuniary threshold limit of Rs. 1 crore applied to the case, making the application not maintainable. The order was served to the parties, and the file was consigned to the record room.