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TMI Blog2020 (10) TMI 964X X X X Extracts X X X X X X X X Extracts X X X X ..... strar of Companies, Maharashtra, Mumbai. Its Corporate Identity Number (CIN) is U15122MH2011PTC225134. Its registered office is Shop No.21 & 22, Gulshan Tower (4th Floor), Moffisal Plot, Amravati 444601, within the State of Maharashtra. Therefore, this Bench has jurisdiction to deal with this petition. 2. The gist of the present petition 2.1. The present petition was filed on 08.11.2018 before this Adjudicating Authority on the ground that the Corporate Debtor failed to make payment of a sum of Rs.1,97,96,082.00 (Rupees one crore ninety-seven lakh ninety-six thousand and eighty-two only) as principal as on 21.09.2013, which is the date of default. 3. The case of the Financial Creditor 3.1. The case of the Financial Creditor is as follows: - (a) The Financial Creditor gave loan in various instalments aggregating to Rs.1,97,96,082/- (Rupees one crore ninety-seven lakh ninety-six thousand and eighty-two only) to the Corporate Debtor. There has been no repayment by the Corporate Debtor. The Financial Creditor sent written communication dated 21.09.2013 demanding payment of the debt due from the Corporate Debtor. (b) The Corporate Debtor replied on 19.10.2013, generally contend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the transaction pertains to the year 2012, whereas the present application has been filed only in the year 2018 (para 8 at page 2 of the Reply); (g) Notwithstanding the above contentions, the petitioner cannot be treated as a financial creditor and hence the petition ought to be dismissed with costs (para 9 at page 2 of the Reply). 4.3. The Financial Creditor has filed a rejoinder, raising procedural objections to the reply filed by the Corporate Debtor. 4.4. We have heard the arguments of both sides and perused the records. 5. The thrust of the Corporate Debtor's objections 5.1. The Corporate Debtor has stated that the claim of the Financial Creditor is not valid, on the following grounds: - (a) That the claim is barred by limitation; (b) That the amount in question has been claimed in a civil suit before the Civil Judge (Senior Division), Amravati, by the Financial Creditor, which dismissed the application of the Financial Creditor for attachment before judgment. The appeal against the order has also been dismissed by the Hon'ble Bombay High Court. (c) These facts have been suppressed by the Financial Creditor in their application before this Adjudicating Authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e contesting parties 7.2. It is apposite to note the rival contentions in Babulal Vardharji Gurjar (supra). Appellant's contentions 7.3. The learned senior counsel appearing for the Appellant therein contended that - (a) the debt shown in the balance sheet does not revive the limitation period of three years as applicable to the IBC under Article 137 of the Limitation Act for the reasons that the debt as shown in the balance sheet is not covered by section 18 of the Limitation Act; and even otherwise, section 18 of the Limitation Act cannot revive the "default" relevant for IBC and could only revive limitation with respect to the cause of action (para 41); (b) the legislative policy has moved from "cause of action" to determination of "default" and in the present case, default having occurred when the account became NPA as on 08.07.2011, the application remains barred by limitation (para 42). Respondent No.2's contentions (Financial Creditor) 7.4. The learned senior counsel for the Financial Creditor had contended that - (a) The debt of the corporate debtor has neither been disputed nor denied by the appellant; rather it is stated in ground P in the memo of appeal tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pending (para 51); (b) The mere date of default or date of classification of an account as NPA does not put a full stop on 'further cause of action' or 'continuing cause of action' available to the financial creditor. ... On the settled principle of law, the interpretation of statute should always be in furtherance to its objective and to give effect to the intent of legislature ... if an application under section 7 could be filed only within three years from the date of NPA, it would frustrate the objective of IBC to restructure the stressed assets and ensure maximisation of the value of stressed assets (para 52); (c) The contention of the appellant that cause of action arose in 2011 and right to sue started ticking in the said year is baseless, as the corporate debtor had continuously admitted its liability in its audited balance sheets until the year 2017 and further admitted its liability with an offer for OTS (para 53). 7.6. The Hon'ble Supreme Court noted that the main plank of submissions of the learned counsel for respondents has been that the applicability of section 18 of the Limitation Act ... is not taken away and, for such acknowledgements have been consistently a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. Findings 8.1. Article 141 of the Constitution stipulates that the law laid down by the Hon'ble Supreme Court is binding on all courts throughout the territory of India, including this Adjudicating Authority. 8.2. We note the date of default mentioned in the application to be 21.09.2013. Also, the Financial Creditor has relied heavily on the acknowledgements in the balance sheets for the Financial Years 31.03.2013, 31.03.2014, 31.03.2015, 31.03.2016, 31.03.2017 and 31.03.2018, which have been attached to the petition at pp.133-219, to contend that the application filed under section 7 of the Code to be within the period of limitation. 8.3. The facts in the present application are similar to those obtaining in Babulal Vardharji Gurjar (supra). 8.4. Applying the date of default criterion laid down by the Hon'ble Supreme Court, we find that the present application filed under section 7 of the Code fails the test of limitation in so far as the Code is concerned. The authorities quoted by Dr SK Jain, learned authorised representative for the Financial Creditor, while no doubt of value under other enactments, cannot be taken into account in the light of the judgment of the Hon'ble ..... X X X X Extracts X X X X X X X X Extracts X X X X
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