TMI Blog2020 (9) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... t the period of three years from the date of the Account of Corporate Debtor is classified as NPA then it becomes impermissible to proceed with Section 7 Application as observed in the para 11 of the Judgment - All these leads to reiterate that the provisions of The Limitation Act, 1963 vide Section 238A of the I B Code, 2016 will be applicable to all NPA cases provided they meet the criteria of Article 137 of the Schedule to The Limitation Act, 1963. The extension for the period of Limitation can only be done by way of application of Section 5 of The Limitation Act, 1963, if any case for the condonation of delay is made out. The impugned order dated 27.08.2019 passed by the Adjudicating Authority (NCLT, Hyderabad Bench, Hyderabad) is se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e alongwith action for its recovery. In addition to the Balance Sheet as on 31.03.2015. A look at the Balance Sheet reveals that the Company has started making losses from the Financial Year 2014-15. The Appellant has also enclosed Memorandum of Writ Petition filed in Hon ble High Court of Judicature at Hyderabad in W.P No.2214 of 2016, the same appears to be pending before the Hon ble High Court of Judicature at Hyderabad and appearing at Annexure A-6 of the main Application. They have also filed the order of Debt Recovery Tribunal, (for short DRT ) Hyderabad in S.A No.10/2017. The DRT, Hyderabad has allowed for quashing the possession notice dated 27.01.2016 of the Bank but has allowed the Respondent Bank to take measure under Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observation that when this Appellate Authority was hearing the matter on 07.02.2020, it has already observed only issue that deserves consideration in this matter is whether the Application under Section 7 of the I B Code, 2016 filed by the Respondent Bank was within the period of limitation . 8. The Respondent Bank has also submitted that the Corporate Debtor/Appellant was already sanctioned the cash credit facility of ₹ 20 Crore, Term Loan of ₹ 14 crore and Letter of Creditor of ₹ 65 Crores by way of a Common Sanction Letter dated 31.05.2012. It was also submitted that the Appellant became irregular in repayment and consequently the account was declared NPA on 30.09.2015. The Respondent Bank has taken necessary meas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be an NPA and was not regularized by the Respondent Bank and Debt of Default continued to be mentioned as the date of NPA. 10. The Hon ble Supreme Court has already observed in Civil Appeal No. 439, 436, 3137, 4979, 5819 7289 of 2018 in B.K.Educational Services Pvt. Ltd Vs. Parag Gupta and Associates dated 11.10.2019 that the limitation period for application under section 7 of the Code is 3 years as provided by Article 137 of the Limitation Act, 1963 which commences from the date of default and is extendable only by application of section 5 of Limitation Act, 1963 if any case for condonation of delay is made out. The view taken by the Hon ble Apex Court in B.K.Educational Services Private Limited Vs. Parag Gupta and Associate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of The Limitation Act, 1963, if any case for the condonation of delay is made out. 13. In view of the above, this Appeal is allowed and we set aside the impugned order dated 27.08.2019 passed by the Adjudicating Authority (NCLT, Hyderabad Bench, Hyderabad). Consequently, orders passed by the Adjudicating Authority appointing IRP/RP, declaring moratorium, freezing of account etc. and all consequential action taken by IRP/RP including advertisement publication etc. all such orders and actions are declared illegal and set aside. The Adjudicating Authority will now close the CIRP proceedings and fix the fee of IRP/RP and the Corporate Debtor will pay the fees of IRP/RP and other costs incurred by him. Let the Registry to communicate the judg ..... X X X X Extracts X X X X X X X X Extracts X X X X
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