TMI Blog2022 (4) TMI 707X X X X Extracts X X X X X X X X Extracts X X X X ..... econstruction Company (India) Ltd. Vs. Bishal Jaiswal Anr. [ 2021 (4) TMI 753 - SUPREME COURT] , where it was held that the NCLT held that the Section 7 application was not barred by limitation, and therefore, admitted the same. It is very much clear that the debt is due and payable in law - Petition dismissed. - Company Appeal (AT)(Insolvency) No. 1097 of 2019 - - - Dated:- 11-4-2022 - ( Justice M. Venugopal ) Member ( Judicial ) And ( Dr. Ashok Kumar Mishra ) Member ( Technical ) For the Appellant : Ms. Aakriti Dhawan , Advocate For the Respondents : Mr. Sidharth Barua , Mr. Praful Jindal and Mr. Daanish Abbas, Advocates for Respondent No. 1 JUDGMENT DR. ASHOK KUMAR MISHRA , TECHNICAL MEMBER This is a case where the Judgment of this Tribunal dated 07.02.2020 in Company Appeal(AT)(Insolvency) No. 1097 of 2019 was challenged by the Financial Creditor in Civil Appeal No. 3228 of 2020 titled as Stressed Asset Stabilisation Fund Vs. G. Eswara Rao Anr. before the Hon ble Supreme Court. The Hon ble Apex Court tagged this Civil Appeal No. 3228 of 2020 along with other Appeals viz., Civil Appeal No. 323 of 2021, Civil Appeal No. 3765 of 2020 and C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of 1st Reference before AAIFR, rejected (1st Reference Appeal). 2.9 Corporate Debtor filed 2nd Reference Case bearing No. 08/2012 (2nd Reference) before BIFR on 28.12.2011. 2.10 On 14.11. 2014, Financial Creditor took over possession of the assets of the Corporate Debtor-2nd Reference stood abated. 2.11 For 3513 days Financial Creditor was prevented from pursing any recovery action against the Corporate Debtor in view Section 22 of SICA, 1985. 2.12 On 17.08.2018, DRT Hyderabad allowed OA No. 193/2004 in favour of the Financial Creditor and passed a decree for a sum of ₹ 57,46,47,286/- along with simple interest @ 12% in favour of Financial Creditor and against the Corporate Debtor. 2.13 Aggrieved Financial Creditor (Respondent No. 1), on 25.03.2019, instituted proceedings under Section 7 of Insolvency and Bankruptcy Code, 2016 (henceforth in short Code ) before the National Company Law Tribunal, Hyderabad (Henceforth Adjudicating Authority being CP(IB) No. 200/7/HDB/2019 [TCP (IB) No. 87/7/AMR/2019]. 2.14 Recovery Certificate bearing No. RC/132/2019 was issued by DRT Hyderabad in favour of Financial Creditor on 19.06.2019. Submission of the Appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Creditor by using malicious proceedings, attracted penal action. They have also cited judgments of the Hon ble Apex Court in the matter of Mobilox Innovations (P) Ltd v. Kirusa Software (P) Ltd. (2018) 1 SCC 353 and Transmission Corporation of Andhra Pradesh Limited v. Equipment Conductors and Cables Limited (2019) 12 SCC 697. Accordingly, as per Appellant, recovery mechanism cannot be used for realisation of debt as per the provision of Code and hence Corporate Insolvency Resolution Process (henceforth CIRP) was initiated against the Corporate Debtor by the Adjudicating Authority vide impugned order dated 01.10.2019 under Section 61 read with Section 7 of the Code in Company Petition TCP(IB) No. 87/7/AMR/2019 [CP (IB) No. 200/7/HDB/2019. SUBMISSION OF THE RESPONDENT No. 1: 6. It is the case of the Respondent No. 1/Financial Creditor that they granted Corporate Debtor various financial Assistances by way of Rupee Term Loan and Foreign Currency Term Loan under respective loan and security Agreements entered into between the Corporate Debtor IDBI Bank. By way of Transfer Deed dated 30.09.2004 executed by IDBI Bank in favour of Stressed Assets Stabilisation Fund (Financi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondent No. 1. V. Date of Decree passed by the DRT (17.08.2018) and filing of Application under Code (25.03.2019) are also not in dispute. VI. The grey area is limited to the following: a) From the date of NPA i.e. 30.09.2002 to the date of filing petition before the NCLT, there is a gap of 17 years, so hopelessly time barred. b) The proceeding is malicious under Section 65 of the Code. c) There is a pending proceeding under MPID Act, 1999 before the designated Court in Mumbai and the properties of the Corporate Debtor were attached including investigation being done by the Economic Offence Wing of Mumbai Police. d) IBC is not intended to be a substitute to a recovery Forum. VII. It has been found from the details submitted by the Financial Creditor that multiple One Time Settlement offer/OTS proposals have been forwarded by the Corporate Debtor from 10.06.2005 to 14.03.2015 including Financial Creditor s letter dated 07.11.2015 indicating the same proposal and asking the Corporate Debtor to submit improved proposal appearing at page no. 499 of the booklet submitted by the Financial Creditor. VIII. The Financial Creditor has submitted Balance Sheet and the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... minority judgment of Justice (Retd.) A.I.S. Cheema, Member (Judicial), after considering most of these judgments, has reached the correct conclusion. We, therefore, set aside the majority judgment of the Full Bench of the NCLAT dated 12.03.2020. 35. On the facts of this case, the NCLT, by its judgment dated 19.02.2020, recorded that the default in this case had been admitted by the corporate debtor, and that the signed balance sheet of the corporate debtor for the year 2016-2017 was not disputed by the corporate debtor. As a result, the NCLT held that the Section 7 application was not barred by limitation, and therefore, admitted the same. We have already set aside the majority judgment of the Full Bench of the NCLAT dated 12.03.2020, and the impugned judgment of the NCLAT dated 22.12.2020 in paragraphs 33 and 34. This appeal is, therefore, allowed, and the matter is remanded to the NCLAT to be decided in accordance with the law laid down in our judgment. XI. Relevant portions of the applicable laws under Section 18 of the Limitation Act 1963, Article 137 of the Limitation Act and Sections 238 238(A) of the Code is reproduced herewith for sake of convenience: S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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