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TMI Blog2022 (6) TMI 623X X X X Extracts X X X X X X X X Extracts X X X X ..... e Appeal has been filed before this Tribunal on 26.10.2021. 3. The Appellant is the Promoter, & Director of the Corporate Debtor(CD) - M/s Chadalavada Infractech Limited. The 1st Respondent - Financial Creditor is a State bank of India and the 2nd Respondent is a Resolution Professional (RP) representing the CD which has been admitted into CIRP vide the above stated order. 4. The Appellant has sought the following reliefs: a. To allow the Appeal and set aside the impugned order dated 23.09.2021 passed by the National Company Law Tribunal, Hyderabad Bench in CP(IB) No. 1/7/HDB/2020. b. To set aside the commencement of Corporate Insolvency Resolution Process initiated against the Corporate Debtor and appointment of the Interim Resolution Professional and all actions taken further to the impugned order dated 23.09.2021 etc. 5. The 1st Respondent -SBI has filed the petition under Section 7 of the Code stating that the CD has availed a loan facility for an amount of Rs.281.23 Crore. The CD was unable to repay the loan and the SBI in accordance with relevant banking provisions declared the loan facilities as 'Non-Performing Assets' (NPA) due to failed restructuring and date of def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Statement of the CD as on 31.03.2018 reflecting the debt outstanding towards the financial creditor/ SBI. However, the Financial creditor has not placed the same before the Adjudicating Authority nor this Tribunal. If it is looked from otherwise the acknowledgment of financial statements for the year 2018 will still miserable failed to establish within the purview of the Limitation Act considering that the limitation period ended on 14.03.2014. The Appellant has relied upon the various judgment as depicted below: * B.K.Educational Services Pvt. Ltd. Vs. Parag Gupta and Ors. MANU/SC/1160/2018 para 12 to 22, 30 & 34 to 42 * BabulaVardharjigurjar V.Veer GujarAluminium Industries Pvt. Limited & Ors. AIR 2000 SC 4668 paras 20 to 32, 35, 35.1, 38.1, 39.1, 39.3 & 40 * V.Hotels Limited Vs. Asset Reconstruction Company India Limited 2019 SCC Online NCLAT91 paras 17 to 28 * Sumeet Maheshwari V.Navbharat Press (Bhopal) Pvt. Ltd. and Ors. MANU/NL/0253/2020 paras 19, 23 t0 25 * Stressed Asset Stablization Fund Vs. Royal Bushes Pvt. Ltd. NCLAT New Delhi, Comp.Appeal (AT) (Ins) 949 of 2020 para 3 to 6 * UCO Bank Vs. Degree Orchards Pvt. Ltd 2020 SCC Online NCLT 662. Para 12 to 21 Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Punjab National Bank & Anr. (Company Appeal (AT) (Ins) no. 28 of 2019) has held, as given below, that OTS is clear acknowledgement of debt: "10. That apart, there is acknowledgement of the outstanding debt on the part of the Corporate Debtor, a fact not disputed by the Corporate Debtor. This comes to fore from the letter dated 04th August, 2018 emanating from the Corporate Debtor and addressed to the Financial Creditor wherein the Corporate Debtor agreed to settle all outstanding dues of the Financial Creditor on OTS basis (refer pages 692-693 Vol.III of the Appeal Paper Book). This is a clear acknowledgment of the outstanding debt in writing and the Corporate Debtor cannot wriggle out of the liability so acknowledged. It is not in controversy that on the date of such acknowledgement, the debt was not time barred and the Insolvency Resolution Process was triggered within the period of limitation in terms of Article 137 of the Limitation Act, computed for such date..." 11. It is also submitted by the SBI/Respondent No.1 that Hon'ble Apex Court in Innoventive Industries Ltd Vs. ICICI bank & Anr (Civil Appeal Nos. 8337-8338 of 2017), it has held that: "28. It is at the stage o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion "default"-not the date of notifying the loan account of the corporate person as NPA. Further, the expression "default" has been defined in Section 3(12) to mean non-payment of debt when whole or nay part or instalment of the amount of debt has become due and payable and is not paid by the debtor or the corporate Debtor, as the case may be. In cases where the Corporate person had offered guarantee in respect of loan transaction, the right of the financial creditor to initiate action against such entity being a corporate debtor (corporate guarantor), would get triggered the moment the principal borrower commits default due to non-payment of debt. Thus, when the principal borrower and/or the (corporate) guarantor admit and acknowledge their liability after declaration of NPA but before the expiration of three years therefrom including the fresh period of limitation due to (successive) acknowledgements, it is not possible to extricate them from the renewed limitation accruing due to the effect of Section 18 of the Limitation Act. Section 18 of the Limitation act gets attracted the moment acknowledgment in writing signed by the party against whom such right to initiate resolution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e its letter dated 15.07.2019 to consider favorably CD exit route through OTS amount of Rs.53 core against the realization value of 73.29 crore by increasing our offer from Rs.45 crores. The CD also requested the Bank /FC to adhere to the one-time settlement proposal and to permit to pay balance amount over a period of six months from the date of approval given by the Bank. It was also stated by the R1 that the Appellant raised the question of limitation rehabilitation letter issued by them and part payment paid by them satisfies the requirement in question of limitation. As the said letter and payment has been made in the period of 2011-12 and the letter 2013 which is admission of debt in itself will satisfy the question of limitation. It is pertinent to note the link letter and this Restructuring Agreement has been signed by the CD and that the CD has never challenged these two documents. The Bank has also attached with the Written Submission Statement of transaction for Account No.:30043104575 (appearing at page no. 94 of the Written Submission of Respondent No.1) for the period from 02.04.2011 to 13.05.2015. For clarity, extract of first page of the statement appearing at page ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and fraudulent transaction under the provisions of the Code. 19. The Adjudicating Authority, while passing the impugned order dated 23.09.2021 has observed the followings: 20. We have carefully gone through the submissions made by the both the learned parties and extant provisions of the Code and we are having the following observations: a. It is undisputed fact that the Corporate Debtor has borrowed the funds from Respondent No.1 and the amounts claimed to be in default is approx. Rs. 216.95 Crore. b. Security held and certificate of registration of charges issued by Registrar of Companies is also not in dispute. c. The Corporate Debtor vide its letter dated 18.07.2011 requesting State Bank of India to allow to operate its accounts within a limit of Rs. 185 Crore approx. d. The petition was filed before the Adjudicating Authority on 25.11.2019 and the date of default is on 15.04.2011 which is due to failed restructuring. The Corporate Debtor vide letter dated 18.07.2011 requested R1/SBI to allow to operate the Account within Rs. 185 Crore approx. The Corporate Debtor vide letter dated 24.12.2013 had requested R1/SBI for restructuring the Account. Sanctioned order for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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