TMI Blog2021 (6) TMI 836X X X X Extracts X X X X X X X X Extracts X X X X ..... execution of the contract dated 12.04.2010 - certification by the respondent/Corporate Debtor can be considered as an admission of debt. Whether the present petition is hit by Article 137 of the Limitation Act, 1963 or section 238A of Limitation Act, 1963? - HELD THAT:- The alleged defaults had occurred between 01.04.2013 and 01.04.2016. Whereas the present petition is filed on 07.05.2019. If limitation period is reckoned between the date of latest default and the date of filing the present petition, there cannot be any delay. Whether the respondent/Corporate Debtor is NBFC? - HELD THAT:- This Adjudicating Authority has noticed in M/S SEW INFRASTRUCTURE LIMITED VERSUS M/S MAHENDRA INVESTMENT [ 2019 (10) TMI 1434 - NATIONAL COMPANY LAW TRIBUNAL, HYDERABAD BENCH] that the respondent/Corporate Debtor is not NBFC. The respondent has failed to provide any proof of registration as NBFC from the regulator, i.e. Reserve Bank of India. As such, we cannot rely on a mere statement made by the respondent in this regard. The Financial Creditor is able to establish the debt and default. Therefore, the petition is required to be admitted against the Corporate Debtor. After going thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der dated 20.09.2017 of the Hon'ble High Court at Calcutta in GA No. 422 of 2017/CS No. 10 of 2017 is at ANNEXURE-I(p), page 104). Aggrieved by the said order the respondent has preferred appeal. Admitting the appeal the Hon'ble High Court of Calcutta issued interim directions vide order dated 12.10.2017 (ANNEXURE-I(r), page 117 of the petition) that, .... the appellant (Mahendra Investment Advisors Pvt. Ltd) to deposit the aforesaid sum as and by way of security within four weeks from the date with the Registrar, Original Side. The Registrar, Original Side shall invest the said money into a short term fixed deposit in any nationalised bank and shall go on renewing the same until further order that may be passed in the instant appeal. There shall be an unconditional stay of the operation of the judgment an decree for a period of four weeks. During the aforesaid interregnum period, the appellant is restrained from alienating, encumbering and disposing of any of the assets either belonging to the company or to this directors without the leave of the court. 6.2. It is submitted in Form-1, Part-V of Othe petition that the Corporate Debtor has failed to deposit th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h power plant at Bhasmey, Sikkim. The applicant has breached several terms of the contract causing huge loss of more than ₹ 500 crores to the respondent's group company. The respondent's group company has initiated arbitration proceedings, which are pending, (para 9) 7.6. It is further submitted that the applicant during the time of execution of work had a contractual obligation to furnish guarantee/security under the Contract dated 12.04.2010. The applicant has failed to provide bank guarantee and has offered to furnish corporate guarantees. The applicant has paid an amount of ₹ 5,00,00,000/- (Rupees five crores only) as security. Hence transaction dated 04.07.2011 even though termed as 'Inter Corporate Deposit', (ANNEXURE R5, page 41 to the Counter) the same is taken as security furnished by the applicant for execution of the contract dated 12.04.2010. (para 10) 7.7. It is submitted that the applicant committed several breaches of the terms of contract. Several commercial OP's were filed under section 9 of the Arbitration and Conciliation Act before the Hon'ble XXIV Additional Chief Judge cum Commercial Court and the same has been dispose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... outside purview of the Code, (para 19) 8. REJOINDER DATED 06.11.2019 FILED BY THE PETITIONER. 8.1. The petitioner contended that the respondent/Corporate Debtor does not deny the extent of liability to the petitioner and that the Corporate Debtor has even admitted the same before the Hon'ble Calcutta High Court in GA No. 422/2017 and CS No. 10/2017. 8.2. It is submitted that the respondent/Corporate Debtor has not produced any evidence to claim that the Corporate Debtor is recognised and registered as NBFC by RBI under section 45IA of RBI Act, 1934. In this regard the petitioner has relied on para 20 of order dated 24.10.2019 passed by this Tribunal in CP (IB) No. 193/7/HDB/2019 (in the matter between SEW Infrastructures Ltd. Vs. Mahendra Investment). 8.3. Paras 4 to 7 deal with the proceedings before the Hon'ble Calcutta High Court. Said proceedings are dealt with in subsequent paras. 8.4. The petitioner denied the allegation of suppression of material facts levelled by the Corporate Debtor as the Financial Creditor has filed copy of court orders at Annexure I(r), page 117-119 along with the petition. 9. REVISED WRITTEN SUBMISSIONS DATED 08.01.2020 FILED ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the necessary protection. The injunction sought would not fall within the scope of appeal. 11. AFFIDAVIT DATED 21.11.2020/14.12.2020 FILED BY THE RESPONDENT. The respondent by way of this Affidavit narrates the chronology of proceedings before the Hon'ble Calcutta High Court and gives updated status of appeal preferred by the Corporate Debtor as 'pending' and that there is 'no subsisting interim orders as on date'. 12. UPDATED BRIEF WRITTEN SUBMISSIONS DATED 11.12.2019/14.12.2019 FILED BY THE PETITIONER. 12.1. The petitioner gives chronology of proceedings before the Hon'ble Calcutta High Court, which were discussed in the preceding paras. The petitioner further provides dates on which the Corporate Debtor gave balance confirmations, which too were discussed in preceding paras. 12.2. The petitioner deals with the main contentions of the Corporate Debtor, which are as under: (1) The Company Petition is barred by limitation. The petitioner submits that as per section 238A of the I B Code read with Article 137 of the Limitation Act, 1963, Company Petition can be filed within three years from the date of cause of action. On this issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceding paras. WRITTEN ARGUMENTS DATED 10.03.2021/12.03.2021 BY THE RESPONDENT. 15. It is submitted that a decree-holder is not a Financial Creditor under section 5(8) of the I B Code, 2016. To emphasise the contention, the respondent relies on decision of the Hon'ble NCLAT in the matter of SUSHIL ANSAL Vs. ASHOK TRIPATHI AND OTHERS, (paras 20 and 23). 16. It is further submitted that the petitioner herein on one hand has filed suit for recovery of the alleged amount and on the other hand has invoked jurisdiction under section 7 of the I B Code. Such an action attracts section 65 of the I B Code. The respondent relies on the following decisions of the Hon'ble NCLAT: (i) HDFC Bank Ltd. Vs. Bhagwan Das Auto Finance Ltd., (paras 3-6), (ii) International Asset Reconstruction Co. Pvt. Ltd. Vs. Jayant Vitamins Ltd., (paras 2 and 3), and (iii) C. Shivakumar Reddy Vs. Dena Bank and others. (paras 12 and 13). 17. On the point of limitation the respondent relies on decisions in the matter of (i) B.K. Educational Services Pvt. Ltd. Vs. Parag Gupta, (2019) 11 SCC 633 (paras 12 to 22, 34 to 42), and (ii) Babulal Vardharji Gujar Vs. Veer Gujar Aluminium In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u is true and correct Such certification by the respondent/Corporate Debtor can be considered as an admission of debt. (ii) WHETHER THE PRESENT PETITION IS HIT BY ARTICLE 137 OF THE LIMITATION ACT, 1963 OR SECTION 238A OF LIMITATION ACT, 1963? Article 137 of the Limitation Act, 1963 provides for three years. Whereas, section 238A of the I B Code reads as under: 238-A. Limitation-The provisions of the Limitation Act, 1963 (36 of 1963) shall, as far as may be, apply to the proceedings or appeals before the Adjudicating Authority, the National Company Law Appellate Tribunal, the Debt Recovery Tribunal or the Debt Recovery Appellate Tribunal, as the case may be. As we see there are five defaults occurring on different dates. Since limitation period is three years from the date of cause of action it is for the petitioner/Financial Creditor to explain the date of default qua particular transaction and satisfy that there is no delay. The petitioner submits that as per section 238A of the I B Code read with Article 137 of the Limitation Act, 1963, Company Petition can be filed within three years from the date of cause of action. To emphasise this point, the petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings against the Corporate Debtor including execution of any judgment, decree or order in any court of law, Tribunal, arbitration panel or other authority; transferring, encumbering, alienating or disposing of by the Corporate Debtor any of its assets or any legal right or beneficial interest therein; any action to foreclose, recover or enforce any security interest created by the Corporate Debtor in respect of its property including any action under Securitization and Reconstruction of Financial Assets and Enforcement of Security interest Act, 2002 (54 of 2002); the recovery of any property by an owner or lessor where such property is occupied by or in possession of the corporate Debtor; (B) That the supply of essential goods or services to the Corporate Debtor, if continuing, shall not be terminated or suspended or interrupted during moratorium period. (C) That the provisions of sub-section (1) of Section 14 shall not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator. (D) That the order of moratorium shall have effect from the date of this order till the completion of the Corporate Insolv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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