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TMI Blog2021 (8) TMI 812X X X X Extracts X X X X X X X X Extracts X X X X ..... oy Saha, Senior Advocate with Mr. Arani Guha and Mr. D. N. Sharma, Advocates For the Respondents : Mr. Ratnanko Banerji, Senior Advocate with Mr. Kunal Tandon, Advocate for Respondent No. 1. Mr. Sanjay Kapur and Mr. V. M. Kannan, Advocates for Respondent No. 2. JUDGMENT A. I. S. Cheema, J. This Appeal has been filed by the Appellant who claims to be shareholder of the Corporate Debtor M/s Mackeil Ispat Forging Limited against impugned order dated 3rd February, 2020 passed by the Adjudicating Authority (National Company Law Tribunal) Kolkata Bench, Kolkata in C.P. (IB) No. 213/KB/2019. The said Company Petition was filed by way of application under Section 7 of Insolvency and Bankruptcy Code ( IBC for short) by Respondent No. 2 State Bank of India (Bank- in short) claiming to be Financial Creditor . The Adjudicating Authority after hearing the parties admitted the application and initiated Corporate Insolvency Resolution Process (CIRP). Thus, the present Appeal. 2. In the present Appeal, the Appellant claimed that the debt of the Corporate Debtor was declared NPA on 31st March, 2013 and the Application under Section 7 was filed on 1st February, 2019 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred to letter dated 14.02.2019 (Annexure R-7), where Corporate Debtor requested for immediate settlement (this would be letter subsequent to filing of Section 7 application). The Respondent Bank has also referred to various amounts paid by the Corporate Debtor while making the OTS offers in 2018. The Bank relies on judgment in the matter of Laxmi Pat Surana vs. Union Bank of India Anr. , 2021 SCC Online SC 267 (Annexure R-10) to submit that from the date of every acknowledgment fresh period of limitation would be required to be computed. Reliance is also placed on the judgment of Hon ble Supreme Court in the matter of ARCIL vs. Bishal Jaiswal , 2021 SCC Online SC 321 (Annexure R-11). Thus, according to the Respondent Bank, the debt was not time barred and the Adjudicating Authority rightly admitted application under Section 7 of IBC. 5. The Learned Senior Counsel for the Appellant at the time of arguments made submissions on the basis of the Appeal and submitted that the question is whether proposal made in OTS can be considered to be acknowledgement. The Learned Senior Counsel for the Appellant referred to Section 23 of the Indian Evidence Act, 1872. The said section re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s agreed together that the OTS offers would not be treated as evidence for the purpose of Court. Thus, Section 23 of the Evidence Act cannot be applied. 9. The Learned Counsel for the Respondent Bank referred to various payments made by the Corporate Debtor from time to time. Para 7 of the Counter Affidavit/ Reply (Dy. No. 27981) reads as follows: 7. Apart from the above, while proposing the OTS offer, the Corporate Debtor had paid an amount of ₹ 0.35Cr, 0.45Cr, 0.10Cr, 0.25Cr, 1.30Cr, 0.30Cr, 0.17Cr, 0.42Cr and 1.08Cr on 14.08.2018, 15.09.2018, 29.09.2018, 01.10.2018, 03.10.2018, 05.10.2018, 15.10.2018, 30.10.2018 and 23.10.2018 respectively, as upfront amount, which would also extend the limitation period. Copy of the proof of payment of ₹ 3.04 Cr on various dates mentioned above is annexed hereto and marked as ANNEXURE R-9. 10. Referring to various letters and OTS offers sent by the Corporate Debtor (referring to the Counter Affidavit), the Learned Counsel referred to his Written Submissions, where relevant portions from the OTS offers are summarised as under: 7. Furthermore, the CD also proposed one time settlement (OTS) offers for considerat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilities to the Corporate Debtor which were defaulted and the accounts became NPA. As on 19.01.2018, total debt outstanding when the restructuring facilities were recalled was ₹ 217,42,97,170.42/- it is argued for the Bank. 12. The Counsel for the Appellant as well as Respondent Bank accepted that Respondent Bank filed OA-103 of 2015 for recovery of the debts before DRT. It is stated that DRT vide order dated 08.06.2018 has issued Recovery Certificate. Going through the OTS offers and letters relied on by the Respondent State Bank of India issued in 2016, 2017 as well as in 2018 and the fact of payments made in 2018, we do not find that the debt can be treated as time barred. The Respondent Bank has rightly relied on judgments in the matter of Laxmi Pat Surana vs. Union Bank of India Anr. and ARCIL vs. Bishal Jaiswal (Supra). We also find substance in the submission made by Learned Counsel for the Respondent that Section 23 of Indian Evidence Act cannot be applied to the facts and documents in the present matter. On facts applicability of Section 23 of Evidence Act is not made out. 13. We rely on the judgment in the matter of Dena Bank vs. C. Shivakumar Reddy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to attract Section 18 of the Limitation Act. In Gaurav Hargovindbhai Dave (supra) cited by Mr. Shivshankar, this Court had no occasion to consider any proposal for one time settlement. Be that as it may, the Balance Sheets and Financial Statements of the Corporate Debtor for 2016-2017, as observed above, constitute acknowledgement of liability which extended the limitation by three years, apart from the fact that a Certificate of Recovery was issued in favour of the Appellant Bank in May 2017. The NCLT rightly admitted the application by its order dated 21st March, 2019. 142. To sum up, in our considered opinion an application under Section 7 of the IBC would not be barred by limitation, on the ground that it had been filed beyond a period of three years from the date of declaration of the loan account of the Corporate Debtor as NPA, if there were an acknowledgement of the debt by the Corporate Debtor before expiry of the period of limitation of three years, in which case the period of limitation would get extended by a further period of three years. 143. Moreover, a judgment and/or decree for money in favour of the Financial Creditor, passed by the DRT, or any other Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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