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TMI Blog2020 (5) TMI 393X X X X Extracts X X X X X X X X Extracts X X X X ..... three years, the applicability of those provisions of the limitation act are to be examined in the light of the facts and circumstances of a particular case. Whether the debt is time barred in the present case in hand? - HELD THAT:- As per article 62 of the Limitation Act, 1963, the limitation period is twelve years from the date when the money sued for becomes due. Here, the Date of Default is 11.03.2015 as per Form I annexed to the petition and the petition is filed on 29.09.2017. In the absence of any specific denial or evidence from the side of the Debtor, it is unreasonable and unjustifiable not to believe the date of default as 11-3-2015. Hence, this Bench is of the view that in either case, i.e. three years or twelve years, this petition is well within limitation and the contention of the respondent that the debt is time barred is rejected. A defaulter cannot dictate a term on the creditor to choose its line of action for due security of the debt. The decision of the creditor to form a consortium of lenders or to join a lending forum is a prerogative of the lender which cannot be intervened by the borrower. In this case, it is also important to place on record that at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the Corporate Debtor executed various loan documents pursuant to which IDFC advanced a Term Loan of ₹ 55,00,00,000/- (Term Loan I) to the Respondent. In November 2009, the Corporate Debtor sought further financial assistance from IDFC and HDFC Limited (HDFC) and a Rupee Term Loan Agreement was entered for an amount of ₹ 22,00,00,000/- (Term Loan II) by the Corporate Debtor and IDFC dated 20.11.2009. This Term loan was to be repaid in 29 structured, quarterly instalments commencing from 15.07.2012 as per the Amortisation Schedule annexed to the Rupee Term Loan Agreement. 4. Thereafter, the Corporate Debtor sought financial assistance from IDFC, HDFC, and Union Bank of India and a Facility Agreement (Secured Term Loan Agreement) dated 24.05.2012 was executed between IDFC, HDFC, Union Bank of India and the Corporate Debtor for advancement of a further amount of ₹ 46,00,00,000/- to the Corporate Debtor (Term Loan III). IDFC also executed an Inter-creditor Agreement dated 24.05.2012 as well as a Security Trustee Agreement dated 24.05.2012 in respect of Term Loan III. (B) Submissions by the Financial Creditor 5. As far as Term Loan I is concerned, it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p Notice nor repaid the amounts mentioned therein. 8. The petitioner states that Term Loans are secured by various security agreements. A Demand Promissory Note dated 24.05.2012 for ₹ 46,00,00,000/- has also been executed by the Corporate Debtor in favour of IDFC for Term Loan III. Hence, the debt as regards Term Loan III has been duly admitted in view of the above said Promissory Note. 9. The petitioner states that the Petition is well within the limitation period. The date of default in the present case is 11.03.2015 as mentioned in Form I annexed to the petition. Hence the contention of the Respondent that the Debt is time barred, ought to be rejected as the prescribed limitation period in suits for enforcing payment of money secured by a mortgage or otherwise charged upon immovable property is Twelve years from the date when money sued for becomes due as per Article 62 of the Limitation Act, 1963. 10. The Petitioner further submits that the petition is complete in all respects as regards the contention of the Corporate Debtor that the Statement of Accounts annexed to the Petition are false and are not certified under Bankers' Books of Evidence Act. The Petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintained on the basis of a double entry system. Hence, the petition is defective and liable to be rejected. Moreover, the said account statements start from September 2014 whereas the said Loan accounts were opened much prior to September 2014. The claim of the Petitioner is severely inflated including for loan accounts which were admittedly settled before the loans were assigned to the petitioner by IDFC. The Corporate Debtor contends that ₹ 77,00,00,000/- has already been paid by RTGS for clearing the dues under Term Loan I and Term Loan II on 09.08.2012. Hence, only Term Loan III is left to be repaid and the assignment of Term Loan II to the Petitioner by IDFC is bad in law. So, it is questioned that in a situation when in respect of Term Loan II part payment had already been made, whether IDFC was justified to assign the balance debt to an assignee i.e. Phoenix ARC. 13.3 Pendency of the JLF: The Corporate Debtor contends that the Petitioner has in breach of the RBI Circulars and directives: (i) obstructed the formation of JLF; (ii) not abided by the majority decisions of the JLF; (iii) not abided by the obligations under the Corrective Action Plan (CAP); (iv) not exi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be barred under Article 137 of the Limitation Act, save and except in those cases where, in the facts of the case, Section 5 of the Limitation Act may be applied to condone the delay in filing such application'. 14.1 Respectfully following the above precedent, this Bench is of the View that the provisions of Limitation Act do apply while implementing the provisions of Insolvency Code. So, the outcome of this discussion is that if the facts of the case narrates that twelve years is to apply instead of three years, the applicability of those provisions of the limitation act are to be examined in the light of the facts and circumstances of a particular case. 14.2 The second issue which arises is that whether the debt is time barred in the present case in hand. The given petition is to enforce the payment of money secured by a mortgage of immovable property. Hence, as per article 62 of the Limitation Act, 1963, the limitation period is twelve years from the date when the money sued for becomes due. Here, the Date of Default is 11.03.2015 as per Form I annexed to the petition and the petition is filed on 29.09.2017. In the absence of any specific denial or evidence from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncial creditor is to be granted seven days' time to complete the application . 16.1 Therefore, while dealing the admission of section 7 of IBC petitions, only two points are required adjudication, i.e. whether there is an existence of ascertainable Debt , and secondly, whether there is an existence of Default . 17. The contention of the Respondent that the petitioner has not complied with the decisions of the JLF is not relevant for deciding a petition u/s 7 of the IBC in view of the Hon'ble NCLAT in the matter of Innoventive Industries Ltd. (supra), that : the 'adjudicating authority' is not required to look into any other factor, including the question whether permission or consent has been obtained from one or other authority, including the JLF. Therefore, the contention of the petition that the Respondent has not obtained permission or consent of JLF to the present proceeding which will be adversely affect loan of other members cannot be accepted and fit to be rejected . 17.1 Hence, in the present case, the above mentioned argument of the Corporate Debtor that IDFC or the Petitioner did not agree for the Joint documentation of further loans to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is nothing on record which proves that any disciplinary action is pending against the said proposed Interim Resolution Professional. 23. Hence, after perusal of the provisions of the Code and facts and circumstances of this case along with the submissions of the petitioner, it is hereby held that this Petition/Application is Admitted. 24. The Financial Creditor has proposed the name of Insolvency Professional. The IRP proposed by the Financial Creditor, Mr. Jayesh Shah, Juris Corp, 902, Tower 2, India Bulls Finance Centre, Senapati Bapat Marg, Elphinstone Road (West), Mumbai-400013, having registration No. IBBI/IPA-001/IP-P00146/2017-18/10310 is hereby appointed as Interim Resolution Professional to conduct the Insolvency Resolution Process. 25. Having admitted the Petition/Application, the provisions of Moratorium as prescribed under section 14 of the Code shall be operative henceforth with effect from the date of order shall be applicable by prohibiting institution of any Suit before a Court of Law, transferring/encumbering any of the assets of the Debtor etc. However, the supply of essential goods or services to the Corporate Debtor shall not be terminated duri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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