TMI Blog2019 (2) TMI 1686X X X X Extracts X X X X X X X X Extracts X X X X ..... not barred by limitation as the given petition is to enforce the payment of money secured by a mortgage of immovable property. Hence, as per Article 62 of the Limitation Act, 1963, the limitation period is twelve years from the date when the money sued for becomes due. Even if the limitation is to be taken three years from the date when the cause of action arose, then also the Corporate Debtor s Balance Sheet as on 31.03.2017 acknowledge the amount payable to the Financial Creditor. Hence, in view of Section 18 of the Limitation act, 1963, the limitation stands extended. Hon ble Supreme Court in the matter of Innoventive Industries Limited V. ICICI Bank Anr. [ 2017 (9) TMI 58 - SUPREME COURT ], wherein inter alia it was held that the provisions of Section 7 become applicable as soon as a financial debt is established and there is an existence of default. The Hon ble court has expressed that the moment the Adjudicating Authority is satisfied that a default in repayment of debt had occurred, the process of insolvency is to be triggered, unless the application is incomplete. The nature of Debt is a Financial Debt as defined under section 5 (8) of the Code. It has also bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alments between 2007 to 2014. However, an amount of ₹11,71,28,848/-was outstanding as on 31.03.2018. 4. Similarly, Term Loan II and Cash Credit was also granted by the Assignor Bank to the Corporate Debtor. The details of all the loan facilities can be summarised in table given below: Sr. No. Loan Facility Total amount (Rs.) Disbursed amount (Rs.) Outstanding amount (Rs.) 1. Term Loan I (Spinning) 17,00,00,000/- 17,35,79,028/- 11,71,28,848/- 2. Term Loan II (Power) 10,00,00,000/- 3,50,00,000/- 2,33,90,395/- 3. Cash Credit (Spinning) 8,50,00,000/- 8,50,00,000/- 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Creditor is acting in its capacity as Trustee of the Phoenix Trust. However, no documents have been produced on record nor any resolution has been passed to assert or prove the aforesaid fact. Hence, the Financial Creditor is not authorised to file this petition. 12. Various technical objections have been raised by the Corporate Debtor. One of them is that the petition U/s 7 is not supported with an affidavit in Form No. NCLT 6 as per Rule 34 of National Company Law Tribunal Rules, 2016. Also, the Resolution passed at the meeting dated 30.01.2016 is defective, although it mentions the name of the persons who are authorised to represent the Company or trust in any court of law. However, the said resolution does not mention the name of the trust and the signatures of various officials have not been attested in the said resolution. Further, the incorporation documents of the Financial Creditor have not been annexed in the petition. 13. The Corporate Debtor argues that the debt is barred by limitation and there has been neither any acknowledgement of debt nor any part-payment after the date of the loan account becoming NPA on 31.12.2014. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15 wherein the description of the Assignee is given as Phoenix ARC Private Limited (Acting in its capacity as Trustee of the Phoenix Trust FY 16-4). Hence, the said contention of the Corporate Debtor ought to be rejected. 19. The Financial Creditor contends that the affidavit verifying the petition has been duly annexed with the petition. As regards the contention of the Corporate Debtor that the Board Resolution dated 30.01.2018 is defective, the Financial Creditor argues that it is not required to pass separate Board Resolutions in respect of each trust and is not invalid on the ground that it does not mention the name of the Phoenix Trust FY 16-4 or otherwise. It is further contended that the petition is complete in all respects and it is not required to produce incorporation documents or the Trust Deed of the Financial Creditor. 20. It is further argued that the debt is not barred by limitation as the liability to the tune of ₹16,42,09,675/- has been acknowledged by the Corporate Debtor in the Balance Sheet for the year ending on 31.03.2017. Reliance has been placed on Edelweiss Asset Reconstruction Company Limited V. M/s Birla Cotsyn (I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds that the documents by which the debt has been assigned to the Financial Creditor have been made a part of the Original Application No. 198 of 2017 filed on 30.03.2017 before the Debts Recovery Tribunal, Nagpur and a copy of the said application has been duly served upon the Corporate Debtor. 23. Furthermore, it is contended that the Financial Creditor is not guilty of Forum Shopping because of the fact that the pendency of the proceedings before the Debt Recovery Tribunal, Nagpur does not preclude the Financial Creditor from filing the Company Petition in hand. The grievance of the Corporate Debtor that the Financial Creditor failed to disburse the amounts as agreed was never raised earlier at any point of time and is thus unsustainable. E) Findings: 24. On going through the submissions made by the Learned counsels of both the sides and on perusal of documents placed on record, it is necessary to deal with all the contentions as hereunder. The Corporate Debtor s foremost contention, that the documents to prove that the Financial Creditor is acting in its capacity as a trustee of the Phoenix Trust have not been placed on record, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terms of Sanction letters in granting the loan or charging of interest, is not relevant in deciding this petition. 27. I am of the view that the Petition is not barred by limitation as the given petition is to enforce the payment of money secured by a mortgage of immovable property. Hence, as per Article 62 of the Limitation Act, 1963, the limitation period is twelve years from the date when the money sued for becomes due. Even if the limitation is to be taken three years from the date when the cause of action arose, then also the Corporate Debtor s Balance Sheet as on 31.03.2017 acknowledge the amount payable to the Financial Creditor. Hence, in view of Section 18 of the Limitation act, 1963, the limitation stands extended. 28. The argument of the Corporate Debtor, that the amount claimed by the Financial Creditor is higher than the amount for which the loan accounts were assigned to it, is clearly vague and inadmissible, as the same is a matter of understanding between the Assignor and Assignee. The Financial Creditor s act of taking over the loan at a reduced rate cannot be questioned as there is an element of risk involved in recovering the debt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with this application/petition by the Financial Creditor and there is nothing on record which proves that any disciplinary action is pending against the said proposed Interim Resolution Professional. 36. Hence, after perusal of the provisions of the Code and facts and circumstances of this case along with the submissions of the petitioner, it is hereby held that this Petition/Application is Admitted. 37. The Financial Creditor has proposed the name of Insolvency Professional. The IRP proposed by the Financial Creditor, Mr. Hasti Mal Kachhara, A-602, Nirman Apartments, Pump House, Vikas Nagar, Andheri East, Mumbai-400093, having registration No. IBBI/IPA-002/IP-N00342/2017-18/10992 is hereby appointed as Interim Resolution Professional to conduct the Insolvency Resolution Process. 38. Having admitted the Petition/Application, the provisions of Moratorium as prescribed under Section 14 of the Code shall be operative henceforth with effect from the date of order shall be applicable by prohibiting institution of any Suit before a Court of Law, transferring/encumbering any of the assets of the Debtor etc. However, the supply of essential ..... X X X X Extracts X X X X X X X X Extracts X X X X
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