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TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 818
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....Kolkata Bench-II Kolkata. By the impugned order, the Adjudicating Authority has admitted Section 7 application filed by J.P. Financial Services Private Limited - Respondent No.1 herein. 2. Brief facts of the case necessary to be noticed for deciding the Appeal are: (i) The Corporate Debtor made a request to the Financial Creditor for a short-term loan. A Loan Agreement dated 07.05.2015 was entered between the parties for an amount of Rs. 2.5 crores along with interest @ 21% per annum and penal interest of 6% on outstanding dues. The loan was to be repaid within 90 days. (ii) The CD sent a letter dated 02.08.2018, acknowledging the debt and offering to make payment by cheque. The CD in its financial statements 2017-18 to 2022-23 acknowledged the debt of Financial Creditor. (iii) Emails were sent by Respondent No.1 to CD on 11.01.2024 and 31.01.2024 regarding further security. An email dated 05.03.2024 was sent by Respondent No.1 giving final opportunity to the CD to repay the amount of Rs. 2.5 crores along with accrued interest within seven days. (iv) The Financial Creditor filed Section 7 application on 30.03.2024 being C.P. (IB) No.182/KB/202....
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....ed the debt of the Financial Creditor. The limitation for filing Section 7 application shall be treated to have been extended by giving the benefit as per Section 18 of the Limitation Act, 1963 and the application was not barred by time. It is further submitted that there was no violation of Section 186, sub-section (2) of the Companies Act. It is submitted that there was sufficient fund available to the CD at the time when loan was extended. The loan granted was within the limit. It is submitted that CD has time and again acknowledged the debt and even before pendency of the application has offered to enter into settlement with the Financial Creditor, which clearly indicate acceptance and acknowledgement of the debt. The CD having committed default of financial debt, the Adjudicating Authority has rightly admitted Section 7 application. 6. We have considered the submissions of learned Counsel for the parties and have perused the record. 7. From the facts brought on record, the disbursement and execution of Loan Agreement between the parties is an admitted fact. The CD's case was that loan was repayable within 90 days and the application filed on 30.03.2024 was beyond limitat....
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....produce the content of letter verbatim which is as under: "Date: 02.8.2018 To J.P Financial Services Private Limited 2, Abhoy Guha Road, Howrah-711204 Dear Sirs, Sub: Loan of Rs. 2,50,00,000/- Refer to our discussion had with you, we are sending herewith Cheque No. 001031 dt. 02.08.2018 for Rs. 2,50,00,000/- towards repayment of Loan and Ch. No. 001032 dt. 02.08.2018 for Rs. 31,45,684/- towards outstanding interest. We are trying to close account by 30.09.2018. Thanking you once again for your co-operation from time to time. Yours faithfully For Avadh Merchants Pvt. Ltd Sd/- Director"" 10. The Adjudicating Authority has also noticed and returned a finding that loan has been acknowledged by the CD in the balance sheets of 2017-18, 2018-19, 2021-22 and 2022-23, which balance sheets were brought on the record along with the rejoinder affidavit filed by the Financial Creditor as Annexure A-3. Financial Creditor in the rejoinder affidavit has brought on record the Financial Statements of the CD. It is useful to refer to Financial Statements of CD, which is brought on record at page 353 ....
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.... Ltd. -- 4,69,000 Tri**** Management Pvt. Ltd. Advances -- 2,00,000 Advance Against Property 34,99,386 34,99,386 Total ************ *********** 12. There being clear and categorical acknowledgement of the debt in the Financial Statements of the CD, we are of the view that by virtue of Section 18 of the Limitation Act, limitation shall be treated to have been extended as noticed by the Adjudicating Authority. The said acknowledgment is continuing from the year 2017-18, 2018,19, 2021-22 and 2022-23. Thus, the application under Section 7 filed on 30.03.2024 was well within time and within the period of limitation. We, thus, are of the view that Adjudicating Authority has rightly rejected the objection of the CD that application was barred by time. 13. Coming to the next submission advanced by the CD that loan extended was not in accordance with Section 186 of the Companies Act, 2013, the said issue has been considered by the Adjudicating Authority from paragraphs 39 to 45. It is useful to notice paragraph 41 of the impugned order, which is as follows: "41. Thus, provision of Section 186 explicitly provides t....
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.... "the Company shall be punishable with fine which shall not be less than Rs. 25000 but which may extend to Rs. 5 lakh and officer of the company who is in default shall be punishable with imprisonment for a term which may extend to two years and with fine which shall not be less than Rs. 25000 but which may extend to Rs. 1 lakh." 16. This Tribunal held that CD cannot take the shelter of Section 186 to deny its liability to return the amount taken by it being a corporate body which is due and payable. In paragraph-22 of the judgment, following has been observed: "22. But in no case the debt advanced by the Company to a corporate body can be held to be unrecoverable only because of the reason that there was a irregularity in advancement of the loan which became a debt to a third party or in other words the CD cannot take the shelter of Section 186 of the Act to deny its liability to return the amount taken by it being a corporate body which is due and payable." 17. The above judgment of this Tribunal in no manner supports the submission of the Appellant, rather, this Tribunal has rejected the said challenge raised by the CD in the said case. 18. Another judgment rel....