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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 ..... t that the Code does not exclude the Application of Section 14 or Section 18 or any other provisions of Limitation Act. Hence, it can be firmly said that the provisions of Section 18 of the Limitation Act, 1963 are applicable to the proceedings under the Code and hence, the impugned order deserves to be upheld. Appeal dismissed. - Company Appeal (AT) (CH) (Ins) No. 276 of 2021 - - - Dated:- 10-6-2022 - [Justice M.Venugopal] Member (Judicial) And (Dr. Ashok Kumar Mishra) Member(Technical) For the Appellant : Mr.P.H.Arvindh Pandian, Sr. Advocate For the Respondents : Ms. Vidyalakshmi Vipin, Advocate for R1 Ms. Mummaneni Vazra Laxmi, Advocate for R2 JUDGMENT DR. ASHOK KUMAR MISHRA, TECHNICAL MEMBER 1. The Appeal has been filed by the Appellant under Section 61 R/w Section 7 of the Insolvency and Bankruptcy Code 2016 (the Code) against the impugned order dated 23.09.2021 passed by the National Company Law Tribunal, Hyderabad Bench (the Adjudicating Authority) in CP No. 1/7/HDB/2020. 2. The impugned order was passed on 23.09.2021 by the Adjudicating Authority and certified copy was received by the Appellant on 30.09.2021 and the Appeal has been filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant provisions of the Limitation Act, 1963. It was fairly stated by the Ld. Sr. Counsel for the Appellant that the Financial creditor/SBI has justified its proposal for not being falling under the trap of limitation Act as the CD has provided OTS proposal to the Financial Creditor on 19.09.2018, 09.11.2018 and 15.07.2019 and the same amounts to acknowledgment of Debt under Section 18 of the Limitation act, 1963. What the Ld, Sr. Counsel for the Appellant has stated that the date of default on 15.04.2011 is undisputed and the Financial creditor itself has stated the reason due to failed restructuring as appearing at page 45 of the Appeal Paper book. 9. The ld. Sr. Counsel for the Appellant has stated that their case is falling under the Limitation Act as even the acknowledgment of debt has been provided after the expiry of limitation period i.e. within three years from the date of default which lapses on 15.04.2015 and all the letters or correspondences for OTS proposals are started from 2018 onwards. It was also fairly stated by the Ld. Sr. Counsel for the Appellant that the Financial Creditor has shifted its reliance from the acknowledgement of debt based on OTS proposal to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e SBI/Respondent No.1 on 10.05.2014. A Restructuring Package Agreement was entered on 19.12.2015. Thereafter vide Sanction letter dated 24.12.2013 additional credit facilities were granted and limits were enhanced. A Restructuring Package Agreement was entered on 03.02.2016. Subsequently a Demand Notice on 26.09.2017 under Section 13(2) of SARFAESI Act, 2OO2 was sent to the Corporate Debtor' Thereafter, Corporate Debtor had vide letters dated 19.09.2018, 09.11.2018 and 15.07.2019 submitted One Time Settlement (OTS) proposals with the SBI/Respondent No.1. It is submitted that there has been an acknowledgement by the corporate Debtor withing three years from date of account of the corporate Debtor being declared NPA and the acknowledgement continued from time to time which is also evident from the OTS proposal submitted by the corporate in 2018 and 2019 which would be an acknowledgement within the meaning of Section 18 of Limitation Act, giving the fresh period of limitation for filing an application under section 7, of the Code. Therefore, the application filed under Section 7 of the Code is within the period of limitation. It is submitted that this Appellate Tribunal, Principal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation Act, 1963: Section 18 of the Limitation Act is applicable to the IBC by virtue of Section 238A of the IBC Relying on the recent judgments of the Supreme Court in Sesh Nath Singh (2021 SCC Online SC 244) and Laxmi Pat Surana (2021 SCC Online SC 267), the SC observed that the rationale for introducing Section 238A of the Code is to make the Limitation Act applicable to proceedings under the Code as far as may be . It was stated that there is no reason why Section 18 of the Limitation Act would be excluded from being applicable to the Code, provided that the acknowledgment of debt is made before expiry of limitation. 13. It is also submitted by the SBI/Respondent No.1 that Hon ble Apex Court in Laxmi Pat Surana Vs. Union of Bank of India Anr. (Civil Appeal No. 2734 of 2020) has held that Section 18 of the Limitation Act applies to extend the period of limitation for filing an application under Section 7 of the Code.: 37. Ordinarily, upon declaration of the loan account/debt as NPA that due can be reckoned as the date of default of enable the financial creditor to initiate action under section 7 of the Code. However, Section 7 comes into play when the CD commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the CD may have subsequently acknowledged the liability held that: 114. In Sesh Nath Singh and Anr. v. Baidyabati Sheoraphuli Cooperative Bank Ltd. (supra) this Court, speaking through one of us (Indira Banerjee J.) held that the IBC does not exclude the application of Section 14 or 18 or any other provision of the Limitation Act. There is therefore no reason to suppose that Sections 14 or 18 of the Limitation Act do not apply to proceedings under Section 7 or Section 9 of the IBC. 116. In Asset Reconstruction Company (India) Limited. v. Bishal Jaiswal and Anr. (supra) where this Court speaking through Nariman J. relied, inter alia, on Sesh Nath Singh (supra) and Laxmi Pat Surana (supra) and held that the question of applicability of Section 18 of the Limitation Act to proceedings under the IBC was no longer res integra. 15. The SBI/Financial creditor/ R1 has also stated that the CD has informed the Bank that in June 2019 there was a steep rise in the three properties in comparison to February/March, 2019 and the total fresh value for the three properties are as follows: A. Fair market value Rs. 86.23 crore B. Realizable value of Rs.73.29 Crore C. Dist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his team visited CD s registered office, but there is no office in the address mentioned. It has also submitted by the RP that the suspended Directors of the CD through email ID provided in the MCA Master data about his appointment and furnished the copy of the CIRP admission order. The RP has constituted the Committed of Creditors (CoC) comprising of only State Bank of India having a claim of Rs. 250.90 Crore and received another claim of Rs. 75,836 which is under process of its examination. It was also stated by the RP that the lone member of the CoC confirmed IRP as RP with 100 % voting right. d. The RP has also stated that he has filed an IA before the Adjudicating Authority for non-cooperation by the CD Suspended Directors. It has also informed that in the 2nd CoC meeting held on 10.12.2021 as reconstituted Committee of Creditors with the following combination and the same is depicted below (appearing at page 53 of the status report filed by the RP): e. The Ld counsel for the RP/R2 has also informed that the RP is waiting to get the handing over and assets and records and required information from the Promoters/Suspended Director to appoint valuers, prepare ..... X X X X Extracts X X X X X X X X Extracts X X X X
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