IBC limitation rules under Article 137: Section 9 insolvency application held within time on continuing commercial relationship.

Section 238A of the Insolvency and Bankruptcy Code, 2016 applies the Limitation Act, 1963 to insolvency proceedings, so a Section 9 application is governed by Article 137 and the three-year period from accrual of the right to apply. On the stated facts, the right to apply was treated as accruing when the Code came into force, and the claim was also linked to a continuing commercial relationship, so the application was not time barred. The question whether the underlying claim itself was time barred was treated as a matter for the Interim Resolution Professional or Resolution Professional, subject to correction by the Adjudicating Authority if necessary.

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Issues: Whether the application under Section 9 of the Insolvency and Bankruptcy Code, 2016 was barred by limitation.

Analysis: Section 238A of the Insolvency and Bankruptcy Code, 2016 makes the Limitation Act, 1963 applicable to proceedings under the Code. For an application under Section 9, Article 137 of the Limitation Act, 1963 applies, prescribing three years from the date when the right to apply accrues. On the facts, the right to apply accrued when the Code came into force and the claim was also traced to a continuing commercial relationship, so the application could not be treated as time barred. The question whether the underlying claim was time barred was held to be a matter for the Interim Resolution Professional or Resolution Professional, subject to correction by the Adjudicating Authority if required.

Conclusion: The limitation objection failed and the Section 9 application was held to be within time.

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