2021 (5) TMI 138 - Tri - Insolvency and Bankruptcy

Tribunal Rejects Time-Barred Petition Under Insolvency Code

The Tribunal dismissed the petition filed under Section 9 of the Insolvency and Bankruptcy Code by the Operational Creditor against the Corporate Debtor. ... Maintainability of application - initiation of CIRP - Corporate debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- On perusal of the records, it is found that the instant petition was filed on 17.02.2020. A copy of the ledger account has been attached where the last payment has been received through Bank for a sum of ₹ 5,03,366/- on 17.04.2013. The balance confirmation is a letter dated 7th September 2019. In the present case, the last date of the transaction is 17.04.2013 and Balance confirmation is given on 07.09.2019 i.e., beyond the period of 3 years from 17.04.2013. Hence, the claim is barred by the Law of Limitation. Petition dismissed. Issues:- Application under Section 9 of the Insolvency and Bankruptcy Code, 2016- Claim of debt by the Operational Creditor- Objections raised by the Corporate Debtor- Compliance with the notice requirements- Fresh documents filed by the Operational Creditor- Appointment of Resolution Professional- Application of the Law of LimitationAnalysis:The judgment pertains to a petition filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 by an Operational Creditor against a Corporate Debtor. The Operational Creditor, engaged in supplying base metals, claimed that the Corporate Debtor owed a total sum of Rs. 24,71,337 plus interest for goods supplied between 2012 and 2018. The Operational Creditor submitted various documents to support the claim, including invoices, ledger accounts, and confirmation of accounts.The Corporate Debtor, in response, denied the claims, stating they were time-barred and termed the petition as malicious. The Corporate Debtor raised objections regarding the confirmation of accounts, lack of authorized signatures, absence of debit notes, and interest accrual. The Corporate Debtor also contested the validity of the notice issued under Section 8 of the Code.The Tribunal considered the documents submitted by both parties and noted that the last payment received was in 2013, with a balance confirmation provided in 2019. The Tribunal applied Section 18(1) of the Limitation Act, which states that if an acknowledgment of liability is made beyond the prescribed period, a fresh period of limitation starts. As the acknowledgment was made beyond three years from the last transaction, the claim was held to be time-barred under the Law of Limitation.Consequently, the Tribunal ruled that the petition was not eligible for admission and rejected it. The application was dismissed, and the matter of appointing a Resolution Professional was left to the discretion of the Adjudicating Authority. The Tribunal disposed of the additional documents filed by the Operational Creditor and did not pass any order regarding costs.