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2022 (9) TMI 20 - AT - Insolvency and BankruptcyCIRP proceedings - Financial Creditors - Non performing assets - applicability of time limitation - guarantee given as Managing Director/ Director of CD shall be treated as personal guarantee or not - on failure of settlement agreement, the FC need to go to DRT or can directly approach Hon’ble Adjudicating Authority for enforcing claims of FC against CD as well as personal guarantor - demand of interest. Whether, debt was due and default took placed? - HELD THAT:- Various term loan and working capital facilities were given by SBT & SBBJ which later merged into SBI (FC). This fact was never disputed by Appellant. It is also noted that subsequent to FC’s claim under SARFAESI Act and later before Hon’ble DRT, CD proposed compromise settlement which also clearly stipulated about existence and acceptance of debt in terms of both principal as well as interest. Therefore, there was clear financial debt which was due and not paid and Adjudicating Authority has, therefore, rightly admitted Application under Section 95(1) of the IBC. Whether the present application filed under Section 95(1) of the IBC is barred by law of limitation? - HELD THAT:- The final order was passed by Hon’ble DRT on 20.09.2019 and the last payment of Rs. 5 crore was made by CD on 31.12.2019, whereas, the Application under Section 95(1) filed before Hon’ble Adjudicating Authority on 03.11.2021. Considering the Hon’ble Supreme Court Suo Moto Writ Petition IN RE: COGNIZANCE FOR EXTENSION OF LIMITATION [2021 (3) TMI 497 - SC ORDER] excluding period of limitation from 15.03.2020 to 28.02.2022 the present application was filed within 74 days from the last payment of 31.12.2019. Thus, it is clear that the Application u/s 95(1) was filed within Limitation Period and we therefore, there are no error in the Judgment of Adjudicating Authority on this point. Whether guarantee given as Managing Director/ Director of CD shall be treated as personal guarantee or otherwise? - HELD THAT:- Section 2 of IBC described the Applications of IBC Code. Section 2(e) of the IBC which case in force w.e.f. 01.12.2019 in so far as they relate to Personal Guarantor to Corporate Debtor. The new section 2(e) came vide notification dated 15.11.2019. The notification also enforced certain other provisions, namely, Section 78, 79 & 94 to 187 (Part III) which provide for Insolvency & Bankruptcy of Individual and also Section 239 (Power to make rules), Section 240 (Power to make regulations) and Section 249 (Part V) in so far as they relate to PGCD - With these amendments through the amended Section 2(e) pertaining to PGCD, it was made possible to subject PGCD to Insolvency Proceedings before same Adjudication Authority (NCLT)/ Appellate Authority (NCLAT) who decides matter related to CD. Thus, if the CD’s debt remains unpaid, the personal guarantor would not stand discharged but would himself be forced to face bankruptcy proceedings before the Adjudicating Authority - thus, there are no error in this regard. Whether, on failure of settlement agreement, the FC need to go to DRT or can directly approach Hon’ble Adjudicating Authority for enforcing claims of FC against CD as well as personal guarantor? - HELD THAT:- There was no requirement to approach the Hon’ble DRT for getting Recovery Certificate before approaching the Adjudicating Authority - there are no merit in the contention of the Appellant on this issue. Whether, the provision of interest by Adjudicating Authority was incorrect and contrary to DRT final order? - HELD THAT:- In any commercial loan, time value is very important. The definition of `financial debt’ as provided in Section 5(8) of IBC mentioned herein above. It makes clear that `Financial Debt’ along with interest against consideration for the time value of money is required. This Tribunal is of the considered view that no ground is made out for any interference by this Tribunal with the impugned order - Appeal dismissed.
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