2022 (12) TMI 368 - AT - Insolvency and Bankruptcy

Tribunal upholds Liquidator's claim under Insolvency Code, dismisses appeal on limitation and debt settlement

RKKR Steels Private Limited Versus Ramakrishnan Sadasivan Liquidator of Surana Industries Limited

RKKR Steels Private Limited Versus Ramakrishnan Sadasivan Liquidator of Surana Industries Limited - TMI Issues Involved:1. Whether the claim filed by the Liquidator under Section 60(5) of the Insolvency and Bankruptcy Code (IBC) is governed by Article 137 of the Limitation Act, 1963, and if the claim is enforceable by law as on the date of the Liquidation Order, or is it barred by LimitationRs.2. Whether the amount is due and payable, as the Appellant claims that the dues were settled by way of inter-company transfers pursuant to a Tripartite Agreement.Detailed Analysis:Issue 1: Limitation and Enforceability of the Claim- The Appellant argued that Section 60(6) of the IBC cannot save a time-barred claim and that the moratorium under Section 14 does not create any embargo on the institution of suits and proceedings by/on behalf of the Corporate Debtor during the CIRP. The Appellant also contended that the Liquidator should have filed a civil suit under Section 35(1)(k) before the appropriate forum rather than converting the Adjudicating Authority into a Trial Court under Section 60(5) of the IBC.- The Tribunal emphasized that Section 60(5) of the IBC aims to prevent multiplicity of suits and to have a single forum determining cases affecting the assets or liabilities of the Corporate Debtor under liquidation. Section 60(6) of the IBC, similar to Section 458A of the Companies Act, 1956, excludes the period of moratorium from the limitation period for any suit or application by or against a Corporate Debtor.- The Tribunal noted that the last invoices for the supply of goods by the Corporate Debtor were dated 16.06.2015, and the moratorium was in effect from 02.01.2018 to 12.10.2018. This period should be excluded in computing the limitation period. Under Article 137 of the Limitation Act, 1963, the period of limitation is three years from when the right to apply accrues. Therefore, the Tribunal held that the claim was not barred by limitation.Issue 2: Due and Payable Amount- The Appellant claimed that the dues were settled by inter-company transfers pursuant to a Tripartite Agreement between the Corporate Debtor, its Sister Concern (Thribovan), and the Appellant. The Appellant argued that the Liquidator erroneously relied on the Corporate Debtor's books of accounts without considering the alleged Tripartite Agreement.- The Tribunal found no evidence of the Tripartite Agreement being filed before the Adjudicating Authority. The communication relied upon by the Appellant dated 08.01.2016 did not provide details of the authorized signatory or any acceptance by the Corporate Debtor for the transfer request. The Tribunal noted that the Appellant failed to provide concrete evidence that the amounts were transferred to the Sister Concern or any acceptance letter by the Corporate Debtor agreeing to such a transfer.- The Tribunal concluded that there was no denial by the Appellant regarding the actual transactions executed, and therefore, upheld the Adjudicating Authority's decision allowing the Liquidator to claim the amount due and payable to the Corporate Debtor.Conclusion:- The Tribunal dismissed the appeal, finding no illegality or infirmity in the Impugned Order. The Adjudicating Authority's decision to allow the Liquidator to claim the amount due and payable to the Corporate Debtor was upheld. The Tribunal granted the Appellant four weeks from the date of the order to make the payment.