2026 (2) TMI 241

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.... by the Jammu and Kashmir Bank has been admitted. The application was filed by the Financial Creditor claiming default of Rs. 63,16,83,242/- as on 31.12.2024. the date of default was mentioned as 31.01.2019. The Adjudicating Authority admitted the application, which order is challenged in this appeal. 2. Learned counsel for the Appellant challenging the order submits that the application was barred by time and ought to have been rejected. It is further submitted that the Adjudicating Authority has adjusted the amount which was part of the resolution plan of the Principal Borrower and another Corporate Guarantor which ought not to have been adjusted and that should have been part of Form-1 and since proceeding under Section 7 is not a rec....

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....on has accrued to the Applicant in respect of the Corporate Guarantor as the limitation for filing the insolvency application against the Corporate Guarantor starts after a default is committed by the Corporate Guarantor in paying the debt demanded in the guarantee invocation notice. The first guarantee invocation letter was issued on 12.02.2020, in which 7 days' time was given for the payment of debt, but the same was not paid, therefore, the date of default in case of the Corporate Guarantor herein can be said to have occurred on 19.02.2020. Thereafter, considering the order of the Hon'ble Supreme Court in In Re: Cognizance for Extension of Limitation, (2022) 3 SCC 117, after excluding the period falling between 15.03.2020 to 28.0....

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....2025 was much beyond time. 6. Admittedly, the guarantee was invoked on 12.02.2020, hence, three years' period shall commence from the said date. The Adjudicating Authority has returned a finding that in Balance Sheet of the year 2021-22 and 2023- 24, there is acknowledgment, which is acknowledgment within the meaning of Section 18 of the Limitation Act, therefore, limitation period stood extended and Application filed on 14.04.2025 is well within time. The Hon'ble Supreme Court in the matter of "Asset Reconstruction Co. (India) Ltd. Vs. Bishal Jaiswal, (2021) 6 SCC 366", held that acknowledgment in the balance sheet is acknowledgement within the meaning of Section 18 of the Limitation Act. We, thus, are of the view that the Adjudicating ....

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....3,16,83,342.24/- payable by the Principal Borrower, the Applicant Financial Creditor has already been paid Rs. 9,31,52,095.23/- from the liquidation proceedings against the Principal Borrower. The balance amount of Rs. 2,39,97,861/- is payable from another Corporate Guarantor in terms of its approved resolution plan. Therefore, a substantial amount of debt of the Principal Borrower due to be paid to the Applicant Financial Creditor herein is still outstanding. Thus, the present Corporate Debtor being the second Corporate Guarantor against whom the present Application has been filed, this Application against it would be considered for its resolution in respect of the remaining debt of Rs. 51,45,33,386 (Rs. 63,16,83,342.24 - [Rs. 9,31,52,095.....