TaxTMI 
TaxTMI 
TaxTMI 
2022 (7) TMI 525
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....hat the Applicant has initiated proceedings before District Magistrate and The Debts Recovery Tribunal within the period of limitation and by virtue of orders passed in these proceedings, deposits have been made in the loan accounts in 2018. The Application is well within the period of limitation. 31. The Applicant has annexed the Commercial Credit Information Report of the Corporate Debtor issued by TransUnion CIBIL, showing that the Corporate Debtor's account is classified as "doubtful'. 32. The Corporate Debtor's email dated 27.02.2018 providing the revised One time settlement proposal is in itself admission of its liability to repay amounts above Rupees One Lakh. The default of financial debt and its admission is found in the Reply, and the email annexed to the Reply in addition to the orders passed in various proceedings. 33. It is established that the Corporate Debtor owes financial debt above a sum of $1,00,000/- and the default is established on perusal of the Commercial Credit Information Report of the Corporate Debtor and the Balance Sheet. 34. In this regard, it is imperative to note that in Sesh Nath Singh and an v. Baidyabati Sheoraphuli Cooperative....
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....nd therefore cannot now agitate this plea at such a belated stage. It is contended by the Learned Counsel that the additional documents sought to be placed in I.A. 455/2021 is only to support its belated plea of extension of Limitation and cannot be permitted at the appellate stage. Morever, the same can be admitted only if conditions under Order 41 Rules 27, 28 & 29 of CPC are complied with. 5. Briefly put, Bank of Baroda has extended financial assistance to the 'Corporate Debtor' through various term loans for an amount of Rs.9,91,00,000/- a lone recall Notice dated 08.10.2013 under Section 13(2) of the SARFAESI Act, 2002 was issued demanding payment of Rs.6,11,42,097/-. On 30.09.2016, the Debt Recovery Tribunal ('DRT') allowed the Bank to recover a sum of Rs.50,00,000/- and thereafter a sum of Rs.20,00,000/- towards interest. It is the case of the Respondent Bank that a One Time Settlement ('OTS') dated 27.03.2018 was entered into between the parties. It is not in dispute that an OTS proposal was extended vide Order dated 07.03.2018 which the Bank vide letter dated 27.03.2018 has accepted the same. For ready reference, the said letter is reproduced as under: 6. The question of....
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....ny part or instalment of the amount of debt has become due and payable and is not paid by the debtor or the corporate debtor, as the case may be. In cases where the corporate person had offered guarantee in respect of loan transaction, the right of the financial creditor to initiate action against such entity being a corporate debtor (corporate guarantor), would get triggered the moment the principal borrower commits default due to non-payment of debt. Thus, when the principal borrower and/or the (corporate) guarantor admit and acknowledge their liability after declaration of NPA but before the expiration of three years therefrom including the fresh period of limitation due to (successive) acknowledgments, it is not possible to extricate them from the renewed limitation accruing due to the effect of Section 18 of the Limitation Act. Section 18 of the Limitation Act gets attracted the moment acknowledgment in writing signed by the party against whom such right to initiate resolution process under Section 7 IBC ensures. Section 18 of the Limitation Act would come into play every time when the principal borrower and/or the corporate guarantor (corporate debtor), as the case may be, ac....
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....s no reason why an offer of One Time Settlement of a live claim, made within the period of limitation, should not also be construed as an acknowledgment to attract Section 18 of the Limitation Act. In Gaurav Hargovindbhai Dave (supra) cited by Mr. Shivshankar, this Court had no occasion to consider any proposal for one time settlement. Be that as it may, the Balance Sheets and Financial Statements of the Corporate Debtor for 2016-2017, as observed above, constitute acknowledgement of liability which extended the limitation by three years, apart from the fact that a Certificate of Recovery was issued in favour of the Appellant Bank in May 2017. The NCLT rightly admitted the application by its order dated 21st March, 2019. 140. To sum up, in our considered opinion an application under Section of the IBC would not be barred by limitation, on the ground that it had been filed beyond a period of three years from the date of declaration of the loan account of the Corporate Debtor as NPA, if there were an acknowledgement of the debt by the Corporate Debtor before expiry of the period of limitation of three years, in which case the period of limitation would get extended by a further per....