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TMI Blog2020 (8) TMI 536X X X X Extracts X X X X X X X X Extracts X X X X ..... y - appeal allowed by way of remand. - Company Appeal(AT) (Insolvency) No. 891 of 2019 - - - Dated:- 6-2-2020 - [Justice A.I.S. Cheema] Member (Judicial) , [Justice Anant Bijay Singh] Member (Judicial) And (Kanthi Narahari) Member(Technical) For the Appellant : Mr. Shivanshu Kumar and Mr. Vikky Dang, Advocates For the Respondent : Ms. Aastha Mehta, Advocate ORDER This Appeal has been filed by Bank of India (Financial Creditor) who had filed Application under Section 7 of Insolvency and Bankruptcy Code, 2016 (in short IBC ) before the Adjudicating Authority (National Company Law Tribunal, Ahmedabad Bench), Ahmedabad in C.P.(I.B.) No. 349/7/NCLT/AHM/2018. The Application was filed claiming that there was a financial debt outstanding, the total value of which is ₹ 22,01,85,312/- which was not cleared by the Respondent- Multi Arc Coating and Straps Limited (Corporate Debtor). There was debt outstanding and default was claimed. The Appellant relied on various documents in support of his claim which can be seen from the Impugned Order itself. 2. The learned Adjudicating Authority heard parties and observed in paragraph -15 of the Judgment as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents and did not refer to them and thus committed an error in recording that the claim was time barred. 4. Letter dated 09.06.2016 from Corporate Debtor to Financial Creditor and other Banks (page-420) has heading Request for One Time Settlement of outstanding dues as per OTS agreed upon for 12.30 crores . Letter reads as under: Respected Sir, With reference to the above referred subject, I would like to bring to your kind notice that this property of the undersigned, situated at Bharuch, being Plot No. 7,8 9 was mortgaged with the consortium of Banks consisting of Bank of India and Punjab National Bank, wherein the Bank of India was lead bank in the consortium of the Bank. As per the one time settlement (OTS) agreed upon, the consortium of Banks was agreeable to One Time Settlement proposal for amount of ₹ 12.30 Cores. In response to this the undersigned has already deposited ₹ 1 Crores in the no lien account as well as the Bank has already recovered the amount of ₹ 6,00,40,000/- by auction sale of Thane Property and have recovered the further amount of ₹ 1,17,00,000/- from auction sale of Plant Machinery of Bharuch Property. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant had sanctioned various facilities in 2006 and there is no dispute regarding the fact that the Account had become NPA on 30.06.2009. She states that the Appellant served Notice under Section 13(2) of SARFAESI only on 10.04.2012 and Debt Recovery Tribunal was moved only in 2015. She accepts that Respondent had sent letter dated 09.06.2016 (page-420) but it is her submission that the letter cannot be construed as an acknowledgement. She states that the letter clearly states that the same is made by the Corporate Debtor without prejudice to rights and contentions of the Corporate Debtor in the Court proceedings pending. It is stated that this letter could not be treated as an acknowledgement. Learned Counsel for the Respondent is submitting that because of this, the Adjudicating Authority ignored the letter dated 09.06.2016 and she supported the judgement of the Adjudicating Authority. 7. Section 18 of the Limitation Act reads as under: 18. Effect of acknowledgment in writing.- (1) Where, before the expiration of the prescribed period for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such property or right ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lve, as a rule the debtor who writes such letters has no intention to bind himself further than is bound already, no intention of paying so long as he can avoid payment, and nothing before his mind but a desire, somehow or other, to gain time and avert pressure. It was argued in a subsequent case that an acknowledgment made without prejudice in the case of negotiations cannot be used as evidence of anything expressly or impliedly admitted. The House of Lords observed as follows: But when a statement is used as acknowledgement for the purpose of s. 29 (5), it is not being used as evidence of anything. The statement is not an evidence of an acknowledgement. It is the acknowledgement. Therefore, the without prejudice rule could have no application. It said: Here, the respondent, Mr. Rashid was not offering any concession. On the contrary, he was seeking one in respect of an undisputed debt. Neither an offer of payment nor actual payment. We, thus, find that the mere introduction of the words without prejudice have no significance and the debtor clearly acknowledged the debt even after action was initiated under the Act and even after payment of a smal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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