Limitation for insolvency applications runs from default, and continuing wrong does not save a completed recovery action.

For an application under Section 7 of the Insolvency and Bankruptcy Code, limitation runs from the date of default under Article 137 of the Limitation Act. The doctrine of continuing wrong under Section 23 applies only where the wrongful act itself continues to create a fresh source of injury; it does not cover the continuing consequences of a completed wrong. On the stated facts, issuance of the Recovery Certificate completed the injury and did not extend limitation. The application was therefore treated as time-barred, and the admitted insolvency orders were set aside.

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Issues: Whether the application under Section 7 of the Insolvency and Bankruptcy Code was barred by limitation, and whether the doctrine of continuing wrong under Section 23 of the Limitation Act saved the claim.

Analysis: Limitation under Article 137 of the Limitation Act applies to applications under Section 7, and the right to sue accrues when default occurs. A continuing wrong is distinct from a continuing effect of a completed wrong. Section 23 applies only where the wrongful act itself continues to create a continuing source of injury. The issuance of the Recovery Certificate completed the injury and did not amount to a continuing wrong. As the default and recovery action were well beyond three years before the application, the claim was time-barred.

Conclusion: The application was barred by limitation, and Section 23 of the Limitation Act did not extend the limitation period.

Final Conclusion: The orders admitting the insolvency application were set aside and the appeal succeeded.

Ratio Decidendi: For an application under Section 7 of the Insolvency and Bankruptcy Code, limitation begins on default under Article 137 of the Limitation Act, and Section 23 applies only to a continuing wrong, not to the continuing consequences of a completed wrong.

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