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TMI Blog2021 (3) TMI 1200X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred by Pawan Kumar Agarwal, Suspended Director of Mohan Jute Mills Ltd., but both the Appeals are disposed of by two separate Judgments. 2. This appeal has been preferred by Appellant- Pawan Kumar Agarwal Suspended Director of Raigarh Properties Pvt. Ltd. being aggrieved and dissatisfied by the impugned order dated 27.02.2020 in C.P. (I.B.) No. 432/KB/2019 passed by Adjudicating Authority, National Company Law Tribunal, Kolkata Bench, Kolkata, whereby and whereunder admitted the Application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (in short IBC) filed by Respondent No. 1 / Financial Creditor the main elements of impugned order is as under: i. The Application filed by the Operational Creditor under Section 7 of the IBC, 2016 for initiating the CIRP against the Corporate Debtor, Raigarh Properites Pvt. Ltd. is hereby admitted. ii. We declare a moratorium and cause public announcement in accordance with Sections 13 and 15 of the IBC, 2016. iii. Moratorium is declared for the purpose referred to in Section 14 of the IBC. The IRP shall cause a public announcement of the initiation of CIRP and call for the submission of claims under Section 15. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l bill. xii. The Resolution Professional shall conduct CIRP in time bound manner as per Regulation 40A of IBBI (Insolvency Resolution Process for Corporate Persons) Regulation, 2016. xiii. List the matter on 09th April, 2020 for the filing of the progress report. xiv. Registry is hereby directed under Section 7(7) of the IBC, 2016 to communicate the order to the Financial Creditor, the Corporate Debtor and to the IRP by speed post as well as through e-mail. xv. Certified copy of the order may be issued to all the concerned parties, if applied for, upon compliance with all requisites formalities. 3. The facts giving rise to the instant Appeal lie in narrow compass as follows: i) The Appellant -Corporate Debtor, in the year 2008, had availed loan from Union Bank of India in respect of which the Corporate Debtor had created security in form of hypothecation and other securities in favour of the Union Bank of India. On account of failure of the Corporate Debtor to repay the loan amount, the account of the Appellant- Corporate Debtor was declared as NPA in 2009. ii) In the year 2010, the securities in form of hypothecat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s on behalf of the Appellant 4. The Appellant during the course of the argument and his Written Submissions submitted that the Adjudicating Authority has failed to appreciate that the Appellant - Corporate Debtor had availed loan from Union Bank of India in the year 2008 and that it was declared NPA in the year 2009. 5. It is further submitted that the Application under Section 7 of the IBC was filed on 14th March, 2019 by Respondent No. 1 at Annexure-2 page 55 to 340, Vol-I & II of the Appeal Paper Book. It was further submitted that the date of NPA was declared on 31st December, 2009 but the Application under Section 7 of the IBC was not filed within three years of Limitation. 6. It is further submitted that the Application under Section 7 of the IBC barred by limitation in view of the judgment of Hon'ble Supreme Court of India reported in 2020 SCC OnLine SC 647 'BABULAL VARDHARJI GURJAR V/s. VEER GURJAR ALUMINIUM INDUSTRIES PVT. LTD. & ANR.' wherein Hon'ble Supreme Court has held as follows: a) that the Code is a beneficial legislation intended to put the corporate debtor back on its feet and is not a mere money recovery legislation; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Book). Pertinently, these OTS / Settlement Offer(s) were rejected by the Respondent No. 1 on 9th November, 2015(at page 322, Vol-II of the Appeal Paper Book) and finally thereafter on 7th April, 2016 (at page 327, Vol-II of the Appeal Paper Book). 9. It is further submitted that this Appellate Tribunal in Company Appeal (AT) (Insolvency) No. 407 of 2019 "C. Shivkumar Reddy V/s Dena Bank & Anr." para 7 has held as follows: "7. In the present case, there is nothing on record to suggest that the 'Corporate Debtor' acknowledged the debt within three years and agreed to pay the debt. The application moved by 'Corporate Debtor' to restructure the debt or payment of the interest, does not amount to acknowledgement of debt. There is nothing on record to suggest that the 'Corporate Debtor' or its authorized representative by its signature has accepted or acknowledged the debt within three years from the date of default or from the date when the account was declared NPA, i.e., on 31st December, 2013. The Balance Sheet of the 'Corporate Debtor' for the year 2016-2017 filed after 31st March, 2017 cannot be termed to be a document of acknowledgement in terms of Section 18 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... informed the Appellant - Corporate Debtor with the requests for modification in conditions of the settlement proposal dated 02.07.2012 has been accepted which is at page 293, Vol-II of the Appeal Paper Book. 16. It is further submitted that on 31.12.2012 an Assignment Agreement at pages 114 to 139, Vol-I of the Appeal Paper Book, was executed between the Principal Lender- Union Bank of India and Respondent No. 1 whereby Principal Lender- Union Bank of India assigned the loan granted to the Corporate Debtor in the year 2010 along with other loans to Respondent No. 1. In pursuance thereof, the Respondent No. 1stepped into the shoes of the Principal Lender- Union Bank of India and accordingly, all the rights for recovery of loan along with the right to contest subsequent litigations were also transferred by the said Agreement. 17. It is admitted that vide letter dated 21.03.2013, the Respondent No. 1 informed the Corporate Debtor regarding proposal for restructuring the scheme of Mohan Jute Mills Ltd. and Raigarh Properties Pvt. Ltd. and further term sheet dated 21.03.2013 was drawn between the Respondent No. 1 and Corporate Debtor which is at Annexure - A/2 Vol-II, page ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e discussions held on 06.08.2015 requested the Respondent No. 1 for the reschedulement of the outstanding principal dues of Rs. 16,89,63,000/- and interest dues to the tune of Rs. 6,71,35,000/- up to 31.08.2015 and to capitalize the same as on 31.08.2015. The fresh proposal was made by the Appellant - Corporate Debtor to the Respondent No. 1 for repayment of outstanding with upfront payment of Rs. 1,50,00,000/- quarterly instalments starting from 30.11.2016 till 31.08.2018 after the moratorium of 12 months on the balance capitalized interest and principal amount from 01.09.2015. The letter written by the Appellant - Corporate Debtor is at Annexure- A/2 at pages No. 316 to 321, Vol-II of the Appeal Paper Book. 24. It is further submitted that on 09.11.2015 (Annexure -A/2 at page No. 322, Vol-II of the Appeal Paper Book), the Respondent No. 1 responded to the requests of the Corporate Debtor and informed the Corporate Debtor that it would need to improve the offer substantially in terms of upfront payment and a shorter repayment term for the Respondent No. 1 to consider a settlement again, whereby an amount of Rs. 1,50,00,000/- was to be paid upfront. 25. It is fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 647 'BABULAL VARDHARJI GURJAR V/s. VEER GURJAR ALUMINIUM INDUSTRIES PVT. LTD. & ANR.' is not applicable in the facts of this case. 31. Learned Counsel for the Respondent No. 1 further while referring on a judgment of this Appellate Tribunal in Company Appeal (AT) (Insolvency) No. 236 of 2020 "Yogeshkumar Jashwantlal Thakkar V/s Indian Overseas Bank decided on 14th September, 2020 wherein this Tribunal as held as follows: ".......... 25. In the decision of Hon'ble Supreme Court in 'Babulal Vardharji Gurjar' V. 'Veer Gurjar Aluminium Industries Pvt. Ltd. and Anr.' (Civil Appeal no. 6357 of 2019 - decided on 14.08.2020) at paragraph 33.1 it is observed as under:- "33.1 Therefore, on the admitted fact situation of the present case, where only the date of default as '08.07.2011' has been stated for the purpose of maintaining the application u/s 7 of the Code, and not even a foundation is laid in the application for suggesting any acknowledgement or any other date of default, in our view, the submissions sought to be developed on behalf of the respondent no. 2 at the latest stage cannot be permitted. It remains trite that the question of limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evelopment rebate u/s 33(1) of the Act. The appeal is accordingly dismissed with costs quantified at Rs. 5,000." 27. In the judgement of Hon'ble Supreme Court 'A.V. Murthy' V. 'B.S. Nagabasavanna' (Criminal Appeal No. 206 of 2002 - decided on 8.2.2002) (MANU/SC/0089/2002) at paragraph 5 it is observed as under:- ".....Moreover, in the instant, the appellant has submitted before us that the respondent in his balance sheet prepared for every year subsequent to the loan advanced by the appellant had shown the amount as deposits from friends. A copy of the balance sheet as on 31st March, 1997 is also produced before us. If the amount borrowed by the respondent is shown in the balance sheet, it may amount to acknowledgment and the creditor might have a fresh period of limitation from the date on which the acknowledgement. However, we do not express any final opinion on all these aspects, as these are matters to be agitated before the magistrate by way of defense of the respondent." and that the judgements of the Hon'ble Supreme Court under Article 141 of the Constitution of India are binding on the Courts / Authorities/ Tribunal(s) in the ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that Director of the 2nd Respondent / Jason Dekor Pvt. Ltd. had confirmed the correctness of the balance of Rs. 14,34,42,101.00 dated 15.10.2013, on 01.11.2013 and over the revenue stamp had affixed his signature. Likewise, the Director of the 2nd Respondent had confirmed the correctness of the balance dated 05.06.2016 and had affixed his signature on 05.06.2016 itself. Likewise, on 20.05.2015 the Director of the 2nd Respondent had confirmed the correctness of the balance in respect of the credit facilities availed by it and the signature was affixed on 20.05.2015. On 02.09.2016 the Director of the 2nd Respondent / 'Corporate Debtor' had executed the revival letter to and in favour of the 1st Respondent / Bank. Similarly, on 31.03.2017, on behalf of the 2nd Respondent the borrower(s) / guarantor had affixed his signature over the revenue stamp. All these balance 'Confirmation Letters' were issued / given to and in favour of the 1st Respondent / Bank and they belie the stance of the Appellant. 33. It is to be relevantly pointed out that a judgement of the court has to be read in the context of queries which arose for consideration in the case in which the judgeme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsp; Limitation Act, 1963, the extension of the period can be made by way of Application under Section 5 of the Limitation Act, 1963 for condonation of delay; however, the peculiar attendant facts and circumstances of the present case which float on the surface are quite different where the 1st Respondent / Bank had obtained Confirmations/Acknowledgments in writing in accordance with Section 18 of the Limitation Act periodically. As a matter of fact, Section 18 of the Limitation Act, 1963 is applicable both for 'Suit' and 'Application' involving 'Acknowledgment of Liability', creating a fresh period of limitation, which shall be computed from the date when the 'Acknowledgment' was so signed. 37. For better and fuller appreciation of the present subject matter in issue, it is useful for this Tribunal to make a pertinent reference to Section 18 of the Limitation Act, 1963 which runs 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 ..... nbsp; since no legal infirmities have been found in the impugned order passed by the Adjudicating Authority in admitting CP No. (IB) 257/7/NCLT/AHM/2019 and declaring moratorium etc. Resultantly, all connected Interlocutory Applications are closed. There shall be no order as to costs. 32. It is further submitted that the facts of this case is squarely covered by Judgment of this Appellate Tribunal (supra), there is no merit in the Appeal and it is fit to be dismissed. Submissions on behalf of the Respondent No. 2 33. The Learned Counsel for the Respondent No. 2- Resolution Professional - Mr. Kamal Nayan Jain has filed the Status Report on 08.09.2020 which reveals that pursuant to the constitution of Committee of Creditors (for short CoC) a meeting was held on 27th March 2020 and again on 5th August, 2020. The Respondent No. 2 - Resolution Professional published brief particulars of the invitation for Expression of Interests for resolution plans in Form - G 'Newspaper' and pursuant thereof two EOIs (Expressions of Interest) were received on 20.08.2020, the last date of receiving the EOI was 20.08.2020 and the matter is pending due to interim order was passed by this Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - Asset Reconstruction Company (India) Limited to Mohan Jute Mills Ltd. informing that proposal for restructuring the scheme of Mohan Jute Mills Ltd. and Raigarh Properties Pvt. Ltd. have been approved and terms sheet dated 21.03.2012 was drawn between the Respondent No. 1 - Asset Reconstruction Company (India) Limited, Mohan Jute Mills Ltd. and Raigarh Properties Pvt. Ltd. which is at Annexure - A/2 Vol-II, pages 221 to 243 of the Appeal Paper Book. h) It is admitted that on 30th June, 2013 and 31st July, 2013, the Corporate Debtor once again defaulted in making payments and the Respondent No. 1 was constrained to issue reminder letters dated 17.07.2013, 08.08.2013, 12.09.2013, 11.11.2013, 12.12.2013 and 19.06.2014 respectively, the letters are evident at Annexure- A/2 at pages 296 to 301, Vol-II of the Appeal Paper Book. i) It is admitted that vide letter dated 23.07.2015, the Corporate Debtor referring to the Term Sheet dated 21.02.2013 requested the Respondent No. 1 for reschedulement of payment as the earlier schedule of payment had not been complied with. In the said letter the Corporate Debtor acknowledged the present dues and future outstanding of inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rescheduled the payment of the instalments, we are of the clean opinion that in view of the Judgment of this Appellate Tribunal (supra) dated 14th September, 2020 the ratio of the judgment is applicable in the facts of this case and this case is squarely covered by the aforesaid judgment. At this stage the plea of the Appellant is that the Application under Section 7 of the IBC is barred by limitation, cannot be sustained in the eye of law. p) The Adjudicating Authority while passing the impugned order dated 27.02.2020 in C.P. (I.B.) No. 432/KB/2019 has considered all these aspects of the matter, so we do not find any reason to interfere with the impugned order. Accordingly, we hereby affirm the impugned order and further came to conclusion that the Appeal is devoid of any merit. The Appeal is accordingly dismissed. q) From the status report filed by the Respondent No. 2 it transpires that two EOIs (Expressions of Interest) have been received on 20th August, 2020 but matter is pending before this Appellate Tribunal there is no further progress in the resolution process. ORDER 35. Having regard to the foregoing discussion, we fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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