Limitation for insolvency claims runs from the relevant defaulted instalment; stamping defects and authority objections may not defeat admission.

A section 7 insolvency application was held to be within limitation because time was counted from the relevant defaulted instalments forming the claim, not the first historical default in the repayment schedule. Insufficient stamping on the contractual documents was treated as a curable defect and not a ground to reject admission. The objection that the petition was filed without valid authority also failed, as board resolution and power of attorney established authorisation. On the materials showing financial debt, default and continuing non-payment, the tribunal admitted the application and directed commencement of CIRP with moratorium and appointment of an interim resolution professional.

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Issues: (i) Whether the section 7 application was barred by limitation on the ground that default first occurred in respect of an earlier instalment. (ii) Whether the petition could be rejected for want of stamping on the contractual documents. (iii) Whether the petition was maintainable in view of the objection that it was filed without valid authority. (iv) Whether the existence of financial debt and default justified admission of the corporate insolvency resolution process application.

Issue (i): Whether the section 7 application was barred by limitation on the ground that default first occurred in respect of an earlier instalment.

Analysis: The relevant default for limitation was taken as the default that gave rise to the claim sought in the petition, not merely the first historical default in the repayment schedule. The corporate debtor had defaulted in relation to instalments that fell due within the three-year period preceding the filing of the application. The reasoning proceeded on the basis that a fresh right to sue arises on each defaulted instalment, and that a time-bar on an earlier component of the debt does not render later instalments, which became due within limitation, unenforceable.

Conclusion: The limitation objection was rejected and the application was held to be within time.

Issue (ii): Whether the petition could be rejected for want of stamping on the contractual documents.

Analysis: The defect of insufficient stamping was treated as curable and not a ground to stall admission of a section 7 petition. The documents relied upon could not be a basis for rejection merely because stamp duty had not been fully paid, since such defect did not go to the root of the insolvency claim at the admission stage.

Conclusion: The objection based on insufficient stamping was rejected.

Issue (iii): Whether the petition was maintainable in view of the objection that it was filed without valid authority.

Analysis: The filing authority was upheld on the basis that the concerned persons were duly authorised by the corporate structure of the financial creditor, including a board resolution and executed power of attorney. The objection did not defeat the maintainability of the application.

Conclusion: The objection regarding lack of valid authority was rejected.

Issue (iv): Whether the existence of financial debt and default justified admission of the corporate insolvency resolution process application.

Analysis: The materials showed a disbursed financial facility, a repayment schedule, an event of default, and continuing non-payment. The tribunal found that the statutory ingredients of financial debt and default were satisfied and that the application met the legal requirements for admission under the insolvency framework.

Conclusion: The application was admitted and the corporate insolvency resolution process was ordered.

Final Conclusion: The insolvency application succeeded, the debtor's objections failed, and CIRP was directed to commence with consequential moratorium and appointment of an interim resolution professional.

Ratio Decidendi: For a section 7 insolvency application, limitation runs from the relevant defaulted instalment sought to be enforced, insufficient stamping of supporting documents is only a curable defect at the admission stage, and proof of financial debt with default is sufficient to warrant admission where the application is otherwise duly authorised and complete.

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