Limitation for Section 7 insolvency applications runs from default date; time-barred debt cannot be revived by mortgage rules or unpleaded acknowledgment.

An application under Section 7 of the Insolvency and Bankruptcy Code is governed by Article 137 of the Limitation Act, with limitation running from the date of default. The Code does not revive a debt that was already time-barred, and acknowledgment under Section 18 can extend limitation only when the necessary facts are properly pleaded and proved. Here, the application itself fixed a single default date, with no pleaded basis for an alternative default date or acknowledgment. Mortgage-based limitation periods, including the twelve-year period under Article 61(b), do not apply to Section 7 proceedings because they are not suits for enforcement of mortgage liability. The application was therefore barred by limitation.

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Issues: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 was barred by limitation, and whether limitation could be extended on the basis of acknowledgment of liability in balance sheets, annual reports, or by reference to mortgage-related limitation periods.

Analysis: The limitation period for an application under Section 7 is governed by Article 137 of the Limitation Act, 1963, and begins when the right to apply accrues, namely on the occurrence of default. The Code does not give a new lease of life to debts that were already time-barred. Acknowledgment under Section 18 of the Limitation Act can extend limitation only where the necessary facts are pleaded and established; in this case, the application itself stated a single date of default as the date of NPA, and no alternative date of default or foundation for acknowledgment was pleaded in the application. The Court also held that limitation provisions relating to suits on mortgage, including the twelve-year period under Article 61(b), do not apply to an application under Section 7, because such an application is not one for enforcement of mortgage liability.

Conclusion: The application under Section 7 was barred by limitation and the respondent could not rely on acknowledgment or mortgage-based limitation to save it.

Ratio Decidendi: An application under Section 7 of the Insolvency and Bankruptcy Code, 2016 is governed by Article 137 of the Limitation Act, 1963, time runs from the date of default, and a time-barred debt cannot be revived for insolvency proceedings by invoking mortgage-related limitation or an unpleaded acknowledgment of liability.

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