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2022 (1) TMI 165 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial creditors - mortgage on leave and license basis - validity of condonation of delay of 1392 days in filing Section 7 Application - principles of limitation for filing applications under Section 7 of IBC - HELD THAT:- After the account of the Corporate Debtor was declared NPA on 28th June, 2013, immediately i.e. in the next month itself i.e. 22nd July, 2013 notice under Section 13 sub-section (2) of SARFAESI Act, 2002 was given by the State Bank of India to the Corporate Debtor and thereafter under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 being O.A. No.726 of 2014 was filed. An order dated 09.03.2017 was passed by the District Magistrate allowing Application under Section 14 of the SARFAESI Act to take physical possession of assets of the Corporate Debtor. The State Bank of India cannot be held to be negligent in prosecuting its remedies for recovery of its debt. To find out ‘sufficient cause’ for condonation of delay, all facts, circumstances and sequence of events have to be taken into consideration. In the present case, it cannot be held that Financial Creditor i.e. State Bank of India was negligent in prosecuting the proceedings for recovery of its debt. It did initiate the proceedings under SARFAESI Act and also filed an Application for recovery of debt under Section 19 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 in the year 2014. The Corporate Debtor having acknowledged the liability in its balance sheet as on 31st March, 2015, the Financial Creditor shall have a fresh period of limitation, which came to an end only on 31st March, 2018 - In the facts and circumstances of the present case, the delay of less than two years’ period has been condoned by the Adjudicating Authority, exercising its discretion under Section 5 of the Limitation Act. It cannot be said that discretion exercised by Adjudicating Authority in condoning the delay is perverse or against any provisions of law or violates any principle of law for determining the ‘sufficient cause’ under Section 5 of the Limitation Act. There are no error in the order of the Adjudicating Authority condoning the delay in filing the Application under Section 7 of the IB Code by the State Bank of India - appeal dismissed.
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