Financial creditor's right to invoke insolvency prevails over consortium arrangements, and written acknowledgments extend limitation.

A financial creditor may invoke insolvency resolution under the IBC even if it is not the lead bank in a consortium, because internal lender arrangements cannot restrict the statutory right to proceed on default and the Code prevails over inconsistent agreements. The section 7 application was also held within limitation, as the debtor's written references to the outstanding facilities, restructuring documents, and loan papers amounted to acknowledgments of liability under section 18 of the Limitation Act, giving rise to a fresh limitation period. On that basis, the insolvency application was maintainable and not time-barred.

---

---

Issues: (i) Whether a financial creditor who is not the lead bank in a consortium can maintain an application under section 7 of the Insolvency and Bankruptcy Code, 2016 despite inter se banking arrangements. (ii) Whether the application under section 7 was barred by limitation or was saved by acknowledgments of liability.

Issue (i): Whether a financial creditor who is not the lead bank in a consortium can maintain an application under section 7 of the Insolvency and Bankruptcy Code, 2016 despite inter se banking arrangements.

Analysis: The statutory scheme of section 7 permits a financial creditor, by itself or jointly with other financial creditors, to initiate corporate insolvency resolution proceedings on default. Section 238 gives overriding effect to the Insolvency and Bankruptcy Code, 2016 over inconsistent instruments or arrangements. Inter se agreements between banks regulate rights among lenders and cannot curtail the statutory entitlement of a financial creditor to seek insolvency resolution where a debt is due and in default.

Conclusion: The application under section 7 was maintainable at the instance of the respondent bank.

Issue (ii): Whether the application under section 7 was barred by limitation or was saved by acknowledgments of liability.

Analysis: Limitation for an application under section 7 is governed by Article 137 of the Limitation Act, 1963. The account was treated as having become non-performing on the date relied upon by the bank, and subsequent letters written by the corporate debtor referred to the outstanding credit facilities, the restructuring documents, and the continuing binding nature of the loan papers. Those writings constituted acknowledgments in writing within the meaning of section 18 of the Limitation Act, 1963 and operated to give rise to a fresh period of limitation. The filing of the section 7 application was therefore within time.

Conclusion: The application was not barred by limitation.

Final Conclusion: The admitted debt, the statutory right of the financial creditor to proceed under the insolvency code, and the effect of written acknowledgments together justified admission of the insolvency application and left no ground for appellate interference.

Ratio Decidendi: A financial creditor's right to invoke section 7 of the Insolvency and Bankruptcy Code, 2016 is statutory and cannot be defeated by internal consortium arrangements, and a written acknowledgment of liability before expiry of limitation renews the period under section 18 of the Limitation Act, 1963.

---