TaxTMI 
TaxTMI 
2020 (9) TMI 15
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....ritization on or Reconstruction Company with the Reserve Bank of India u/s 3 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, having its registered office at: Dani Corporate Park, 5th Floor, 158, C.S.T. Road, Kalina, Santacruz (E), Mumbai-400098, India. 2. The Respondent/Corporate-Debtor-Company, namely M/s. Nagaur Water Supply Company Private Limited was incorporated on 26.03.2008 with CIN: U41000GJ2008PTC053373. As submitted, the authorised share capital of the company is Rs. 1,00,000/- (Rupees One Lakh only). The issued, subscribed and paid up share capital is Rs. 1,00,000/- (Rupees One Lakh only). It reflects that the Respondent Company is engaged in the business of desalination of water. The registered addresses of the Respondent/Corporate-Debtor-Company are: (i) Building No. 9, Sigma Corporate, Behind Rajpath Club, Off. S.G. Road, Bodakdev, Ahmedabad - 380054, India. (ii) Building No. 12-A (House No. 13, Sigma Corporate, Behind Rajpath Club, Off. S.G. Road, Bodakdev, Ahmedabad - 380054. (iii) 1015, 'A' Wing, 10th Floor, Atma House, Opp. La-Gajjar Chambers - RBI, Ashram Road, Ahme....
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....(vi) Copy of irrevocable power of attorney dated 14.06.2011. (vii) Copy of Deed of Guarantee dated 14.06.2011. 11. The Petitioner submits that lender L&T Infrastructure Finance Co. Ltd. has duly assigned the above stated debts of the Corporate Debtor to the present Petitioner, vide its assignment deed dated 30.12.2013. 12. The Petitioner states that the loan amount is shown in the balance sheet of the Corporate Debtor. In support of such contention, the Petitioner has annexed a copy of the audited accounts of Corporate Debtor filed before the ROC to the Ministry of Corporate Affairs for the Financial Year ending on 31.03.2015, 31.03.2016 and 31.03.2017. Hence, as per the petitioner, it is as good as acknowledgement of its debt liability and such debt is not barred by the limitation. 13. It is submitted that the debt shown in the balance sheet is still due and payable to the L&T Infrastructure Finance Co. Ltd., which has now stands assigned to the present Petitioner. Hence, the present I.B. Petition is filed within the limitation. 14. In response to the present petition, the Respondent/Corporate Debtor has filed its objection reply as well as written submission ....
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.....2017 before this court. Hence, in our view, it is filed beyond the limitation. The legal position, in this respect has been well settled by the Hon'ble Supreme Court in catena of its decision, i.e. in Vashdeo R. Bhojwani Vs. Abhyudaya Co-operative Bank Ltd. & Ors. Civil Appeal No. 11020 of 2018, Gaurav Hargovindbhai Dave Vs. Asset Reconstruction Company (India) Ltd. and Ors. decided on 18.09.2019 and Sagar Sharma Vs. Phoenix ARC (P.) Ltd. wherein, their Lordship has pleased to reiterate its view as taken in its decision in B.K. Educational Services (P.) Ltd. Vs. Parag Gupta, on the issue of limitation applicable to an I.B. Petition. For the sake of convenience, the relevant paragraph of above stated decision Hon'ble Supreme Court in the matter of B.K. Educational Services (P.) Ltd. Vs. Parag Gupta, is being reproduced herein below. "It is thus clear that since the Limitation Act is applicable to applications filed Under Sections 7 and 9 of the Code from the inception of the Code, Article 137 of the Limitation Act gets attracted. "The right to sue", therefore, accrues when a default occurs. If the default has occurred over three years prior to the date of filing....
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....ue Applying the aforesaid Article, the NCLT reached the conclusion that since the limitation period was 12 years from the date on which the money suit has become due, the aforesaid claim was filed within limitation and hence admitted the Section 7 application. The NCLAT vide the impugned judgment held, following its earlier judgments, that the time of limitation would begin running for the purposes of limitation only on and from 01.12.2016 which is the date on which the Insolvency and Bankruptcy Code was brought into force. Consequently, it dismissed the appeal. 4. Mr. Aditya Parolia, learned Counsel appearing on behalf of the Appellant has argued that Article 137 being a residuary Article would apply on the facts of this case, and as right to sue accrued only on and from 21.07.2011, three years having elapsed since then in 2014, the Section 7 application filed in 2017 is clearly out of time. He has also referred to our judgment in B.K. Educational Services Private Limited v. Parag Gupta and Associates, MANU/SC/1160/2018 in order to buttress his argument that it is Article 137 of the Limitation Act which will apply to the facts of this case. 5. Mr. Debal ....
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....2019 - SC) MANU/SC/1213/2019 ) is being reproduced herein below: 1. In the facts of the present case, at the relevant time, a default of Rs. 6.7 Crores was found as against the Respondent No. 2. The Respondent No. 2 had been declared a NPA by Abhyudaya Cooperative Bank Limited on 23.12.1999. Ultimately, a Recovery Certificate dated 24.12.2001 was issued for this amount. A Section 7 petition was filed by the Respondent No. 1 on 21.07.2017 before the NCLT claiming that this amount together with interest, which kept ticking from 1998, was payable to the Respondent as the loan granted to Respondent No. 2 had originally been assigned, and, thanks to a merger with another Cooperative Bank in 2006, the Respondent became a Financial Creditor to whom these moneys were owed. A petition Under Section 7 was admitted on 05.03.2018 by the NCLT, stating that as the default continued, no period of limitation would attach and the petition would, therefore, have to be admitted. 2. An appeal filed to the NCLAT resulted in a dismissal on 05.09.2018, stating that since the cause of action in the present case was continuing no limitation period would attach. It was further held that th....
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....lt to hold that the trustees' act in denying altogether the alleged rights of the Guravs as hereditary worshippers and in claiming and obtaining possession from them by their suit in 1922 was a continuing wrong. The decree obtained by the trustees in the said litigation had injured effectively and completely the Appellants' rights though the damage caused by the said decree subsequently continued... (at page 496). Following this judgment, it is clear that when the Recovery Certificate dated 24.12.2001 was issued, this Certificate injured effectively and completely the Appellant's rights as a result of which limitation would have begun ticking. 5. This being the case, and the claim in the present suit being time barred, there is no doubt that is due and payable in law. We allow the appeal and set aside the orders of the NCLT and NCLAT. There will be no order as to costs." 23. Further, similar view and stand was taken by the Hon'ble Supreme Court in the matter of Sagar Sharma Vs. Phoenix ARC (P.) Ltd. For the sake of convenience, the relevant portion of the decision in Sagar Sharma and Ors. vs. Phoenix ARC Pvt. Ltd. and Ors. (30.09.2019 -SC MANU/S....
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....T. 7. Mr. Rakesh Dwivedi, learned Senior Counsel, wishes to raise a plea based on Section 22 of the Limitation Act before the NCLAT. We record this statement." 24. In addition to the above, the Hon'ble NCLAT, in its decision in the matter of C. Shivakumar Reddy Vs. Dena Bank and Ors. has held that the acknowledgement of the amount of debts shown in the annual balance sheet cannot be treated a proper acknowledgement of loan debts under Section 13 of the Limitation Act. The relevant portion of the said judgment is reproduced herein below: (C. Shivakumar Reddy) "4. The learned Counsel for the Respondent contended that on 28th March, 2014, the Corporate Debtor deposited two months interest amounting to Rs. 111 lakhs. Subsequently, in its reply dated 5th January 2015 to the Demand Notice issued on 22nd December, 2014, the Corporate Debtor sought restructuring of the debt. Infact, the Corporate Debtor defaulted in re-payment of the loan to the 1st Respondent Bank had accepted in the Balance Sheet of the Corporate Debtor that loan is due for the year 2016-17. The Corporate Debtor also acknowledged its liability, which is also clear from the letter of one-time sett....