IBC limitation and default record supported admission of a section 7 insolvency petition, with the limitation objection rejected.

A section 7 IBC application was found to be within limitation because it was filed with reference to the last payment made by the corporate debtor, supported by the payment history and the date of NPA classification; the Article 137 limitation objection read with section 238A IBC was rejected. Financial debt and default were also established through the disbursal of secured non-convertible debentures, the assignee status of the applicant, the default record, the default notice, the information utility data, and the corporate debtor's written submissions admitting liability. On that basis, the petition was admitted, moratorium followed, and an interim resolution professional was appointed.

---

---

Issues: (i) whether the application under section 7 of the Insolvency and Bankruptcy Code, 2016 was barred by limitation; (ii) whether the existence of financial debt and default was established so as to warrant admission of the petition.

Issue (i): whether the application under section 7 of the Insolvency and Bankruptcy Code, 2016 was barred by limitation.

Analysis: The petition was filed within the period counted from the last payment made by the corporate debtor, and the record showed continuing payments before default. The Tribunal also relied upon the payment history and the date on which the account was classified as non-performing asset. In these circumstances, the claim was treated as falling within limitation, and the objection based on Article 137 of the Limitation Act, 1963 read with section 238A of the Insolvency and Bankruptcy Code, 2016 was not accepted.

Conclusion: The application was held to be within limitation and the objection of bar of limitation failed.

Issue (ii): whether the existence of financial debt and default was established so as to warrant admission of the petition.

Analysis: The Tribunal found that the debt arose from disbursal of financial facilities through secured non-convertible debentures, that the petitioner was the assignee of the debt, and that default was evidenced by the payment record, the notice of default, and the information utility record. The corporate debtor's written submissions were also treated as an admission of liability. On this basis, the Tribunal concluded that the requirements of financial debt and default under sections 5(8) and 3(12) of the Code were satisfied and that the petition was fit for admission under section 7.

Conclusion: The existence of financial debt and default was established and the petition was admitted.

Final Conclusion: The insolvency application was admitted, moratorium followed, and an interim resolution professional was appointed to commence the corporate insolvency resolution process.

Ratio Decidendi: A section 7 application is admissible where financial debt and default are established by the documentary record and the debtor's payment history, and a limitation objection fails when the claim is within time as computed from the last payment or other legally relevant acknowledgment.

---