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2019 (11) TMI 1490 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and dispute or not - Whether the MoU is a validly executed contract binding the Corporate Debtor? - HELD THAT:- The MoU, even if raised to the level of a contract, does not carry the seal of the Corporate Debtor, but only the signature of one Mr. Shantilal Ratanchand Lunkad, who is claimed to be the authorised signatory. However, the nature of authorisation, such as by way of a Board Resolution, has not been stated in the MoU. The signature portion of the MoU also does not express it to be "For and on behalf of the Company", but instead uses the words "Signed, Sealed and Delivered by the with in named the Company by the hands of Mr. Shantilal Ratanchand Lunkad, the Authorised Signatory" - In the absence of the seal of the company or details of authorisation, the MoU cannot be said to be executed with proper authority, not a legally valid document and not binding on the Company (Corporate Debtor). Issue No. 1 is, therefore, decided accordingly. Whether the amount claimed under the MoU can be held to satisfy the definition of "Operational Debt" given in section 2(21) of the IBC? - HELD THAT:- In view of the decision that the MoU is not validly executed and does not bind the Corporate Debtor, this issue has become infructuous. In the event that the definition of "Operational Debt" is satisfied, whether the claim itself is hit by limitation? - HELD THAT:- The Corporate Debtor has raised the issue that the MoU is dated 21.08.2013 and the petition came to be filed on 30.04.2019 and the same is beyond three years and hence barred by limitation. There is merit in this argument, when seen in the light of the fact that the MoU itself says that the payment is due from 01.08.2013. Therefore, the question of limitation has to be considered - also, it is not the case of the Operational Creditor that there was any acknowledgement of liability on the part of the Corporate Debtor within the limitation period of three years that may have the effect of extending the period of limitation within the meaning of section 18 of the Limitation Act, 1963. The petition fails the twin tests of merit and limitation, and therefore, the same is rejected.
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