TaxTMI 
TaxTMI 
2025 (3) TMI 203
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....issues espoused by the same set of parties raise common questions of law and fact and can be conveniently disposed of by this common order. For the purpose of adjudication, FAO [First Appeal against Order] No. 226/2022 shall be the lead appeal. 3. Shorn of unnecessary details, the two civil suits, which were at the stage of recording the plaintiff's evidence, with PW-1 to be tendered for cross-examination, were dismissed in default for want of prosecution vide order dated 04.06.2018 by the learned Trial Court. The appellant/plaintiff then filed an application under Order IX Rule 9 of the CPC on 06.12.2018, which was dismissed by the learned trial Court after issuing notice to the respondent and hearing the parties. 4. It is pertinent to note that the appellant/plaintiff, in its application under Order IX Rule 9 of the CPC seeking restoration of the suit, submitted that due to financial difficulties, it, as the corporate debtor, had initiated proceedings under Section 10 of the Insolvency and Bankruptcy Code, 2016 [IBC], before the National Company Law Tribunal, Mumbai ["NCLT"] on 29.01.2018 and vide order dated 14.05.2018, the NCLT appointed an Insolvency Resolution Professio....
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....ad to invoke proceedings under the IBC before the NCLT on 14.05.2018 and subsequently Resolution Plan was approved on 28.11.2019. She further alluded to the contents of the email dated 07.11.2017, wherein the Ex-Management instructed the representing counsel to put all litigations on hold until further instructions. It is contended that after the Resolution Plan was approved on 28.11.2019, and in the interregnum instructions were given to the counsel on 05.10.2018 to file an application for restoration of the suit, which was eventually filed on 06.12.2018. It is thus urged that the period of moratorium w.e.f. 14.05.2018 to 28.11.2019 ought to have been excluded for excluding the time for filing of the applications under Order IX Rule 9 of the CPC. 6. Per contra, the learned counsel appearing for the respondent, appearing via video conferencing, contended that a hearing had taken place in the two matters on 18.08.2017, on that day PW-1 was produced for cross-examination, but the matters were adjourned to 06.11.2017. It is submitted that no appearance was put on 06.11.2017, and although no adverse order was passed, the matter was subsequently listed for hearings on 09.01.2018, 07.....
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.... of the IBC to determine whether this provision provides a new lease of life to proceedings initiated by the Corporate Debtor, based on the moratorium imposed under Section 14 of the IBC. The case involved the Corporate Debtor seeking an extension of the limitation period to file an application under Section 11 (6) of the Arbitration and Conciliation Act, 1996. It would be expedient to refer to the observations made by the Supreme Court, which are as follows: - "24. Under the IBC, by virtue of the order admitting the application, be it under Sections 7, 9 or 10, and imposing moratorium, proceedings as are contemplated in Section 14 would be tabooed. This undoubtedly does not include an application under Section 11 (6) of the 1996 Act by the corporate debtor or for that matter, any other proceeding by the corporate debtor against another party. At least there is no express exclusion of the jurisdiction of the Court or authorities to entertain any such proceeding at the hands of the corporate debtor. However, we must not be oblivious to the other provisions as well. Under Section 17, the management of the affairs of the corporate debtor is taken over by the interim resolutio....
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....t is true that on the one hand what is tabooed in Section 14 when a Moratorium is put into place is inter alia the institution of suits or continuance of pending suits or proceedings against the corporate debtor including proceeding in execution of inter alia, the decree or order of an arbitration panel. So, also the provision prohibits any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002. Still further, the recovery of any property by an owner or lessor in the occupation of the corporate debtor is forbidden. These provisions do not in any manner appear to stand in the way of the corporate debtor instituting or proceeding with a suit or a proceeding against others. Section 60 (6) on the other hand excludes the period during which the Moratorium under Section 14 is in place in computing the period of limitation. An ambiguity is introduced, namely the need to exclude the period of limitation for a suit or an application, at the instance of the corporate debtor when a Moratorium ushere....
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....n 60 (6) has been put in place. This Court cannot possibly sit in judgment over the wisdom of the Law Giver. The period of limitation is provided under the Limitation Act. The law giver has contemplated that when a moratorium has been put in place, the said period must be excluded. We cannot overlook also the employment of words 'any suit or application'. This is apart, no doubt, from the words 'by a corporate debtor'. Interpreting the statute in the manner which the appellant seeks would result in our denying the benefit of extending the period of limitation to the corporate debtor, a result, which we think, would not be warranted by the clear words used in the statute." 11. In view of the aforesaid provision of law, this Court finds merit in the plea advanced by the learned counsel for the appellant/plaintiff that the period of moratorium, i.e., from 14.05.2018 to 28.11.2019, must be excluded. It is during such period that the two suits were dismissed for non-prosecution on 04.06.2018. The fact that the application was filed on 06.12.2018, despite instructions from the IRP on 05.10.2018, does not carry significant weight, especially considering that the appellant/plaintiff was....