Tribunal overturns rejection of debt claim, ruling it not time-barred.

The Tribunal set aside the Resolution Professional's rejection of the financial debt claim by the Applicant, finding the rejection erroneous. The Tribunal determined that the claim was not time-barred, considering the date of default/NPA for limitation purposes. Acknowledgment of debt was not deemed necessary for claim acceptance, and the RP's jurisdiction in determining the claim's limitation was found to be administrative, not adjudicatory. Consequently, the Tribunal allowed the Applicant's financial debt claim in the case.

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Issues Involved:
1. Rejection of financial debt claim by the Resolution Professional (RP).
2. Determination of the period of limitation for the claim.
3. Requirement of acknowledgment of debt for claim acceptance.
4. Jurisdiction and role of the Interim Resolution Professional (IRP)/Resolution Professional (RP).

Issue-wise Detailed Analysis:

1. Rejection of financial debt claim by the Resolution Professional (RP):
The Applicant, Hero Fincorp Limited, sought intervention to set aside the RP's communications dated 24.04.2020 and 14.06.2020, which rejected its financial debt claim. The RP had declined the claim citing it was barred by limitation and for non-submission of acknowledgment of debt. The Tribunal noted that all necessary documents, including loan agreements and guarantees, were annexed by the Applicant to establish the debt. The RP's rejection was deemed erroneous, and the Tribunal set aside the RP's communications, allowing the Applicant's claim.

2. Determination of the period of limitation for the claim:
The RP initially rejected the claim on the grounds that it was barred by limitation, referencing the Supreme Court's decision in B.K Educational Services. The Applicant argued that the limitation period should be reckoned from the date of the account being classified as Non-Performing Asset (NPA) on 06.11.2019, not from the date of the loan agreements. The Tribunal upheld the Applicant's position, stating that the date of default/NPA should be considered for counting the limitation period under Article 137 of the Limitation Act, 1963. Thus, the claim was within the limitation period and could not be rejected on these grounds.

3. Requirement of acknowledgment of debt for claim acceptance:
The RP requested acknowledgment of debt from the Applicant, which was not provided. The Applicant contended that acknowledgment of debt is not the sole criterion for determining the period of limitation and that the classification of the account as NPA and the last payment date should be considered. The Tribunal agreed, stating that acknowledgment of debt is not a prerequisite for claim acceptance. The existence of documents showing a debt default is sufficient. The Tribunal found that the Applicant had provided adequate documentation to establish the debt.

4. Jurisdiction and role of the Interim Resolution Professional (IRP)/Resolution Professional (RP):
The Applicant argued that the RP exceeded his jurisdiction in determining the claim's limitation and rejecting it. Citing the Supreme Court's decisions in 'Swiss Ribbons Pvt. Ltd. & Anr v. Union of India & Ors.' and 'Committee of Creditors of Essar Steel India Limited v. Satish Kumar Gupta & Others,' the Applicant asserted that the IRP/RP's role is administrative, not adjudicatory. The Tribunal concurred, emphasizing that the RP should not have adjudicated on the limitation issue and should have accepted the claim based on the provided documentation.

Conclusion:
The Tribunal concluded that the RP erroneously rejected the Applicant's claim. The communications dated 24.04.2020 and 14.06.2020 from the RP were set aside. The Tribunal allowed I.A. No. 90 of 2021 in C.P. (IB) No. 342/BB/2019, thereby accepting the Applicant's financial debt claim.

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