Court allows limitation plea in insolvency application, directs Tribunal review.

The Court declined to adjudicate on the limitation issue in the application for Corporate Insolvency Resolution Process against the petitioner. The Court permitted the petitioner to raise the limitation plea before the Debts Recovery Tribunal for consideration. The Tribunal was directed to decide on the application's maintainability based on the presented materials, emphasizing assessment in light of the petitioner's limitation argument. The Court disposed of the writ petitions without costs, with connected miscellaneous petitions closed, awaiting the Tribunal's decision.

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Issues:
1. Application for initiation of Corporate Insolvency Resolution Process against the petitioner/guarantor.
2. Bar of limitation in filing the application under Section 7(2) of the Insolvency and Bankruptcy Code, 2016.

Analysis:
1. The petitioner, a Promoter and erstwhile Director of a company, availed a loan from the 1st respondent Bank as a personal guarantor. The company defaulted, leading to the loan being classified as a 'Non-Performing Asset.' Subsequently, the Bank initiated legal proceedings for recovery, including filing an application for Corporate Insolvency Resolution Process against the petitioner. The petitioner argued that the application was barred by limitation, citing a Supreme Court judgment and emphasizing the application of the Limitation Act to insolvency proceedings. The petitioner contended that since the date of default was in 2015, the application was time-barred. The respondent Bank, however, argued that the plea of limitation was a mixed question of law and facts, and considering the impact of the Covid-19 pandemic, the application was within the limitation period.

2. The Court acknowledged the rival submissions regarding the limitation issue but declined to adjudicate on it, noting that the matter involved a mixed question of law and facts. The Court highlighted the plea made by the respondent Bank in their application and the pending consideration by the Debts Recovery Tribunal. Consequently, the Court permitted the petitioner to raise the plea of limitation before the Tribunal and directed the Tribunal to decide on the application's maintainability based on the materials presented. The Court emphasized that the Tribunal would assess the application in light of the petitioner's limitation argument and issue a decision in accordance with the law. Depending on the Tribunal's decision, further actions would ensue, and the writ petitions were disposed of without costs, with connected miscellaneous petitions closed.

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