NCLAT upholds admission of petition u/s 7 as default in repayment of financial debt was not time-barred

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  • Last Updated on 13 August, 2021

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Corporate insolvency resolution process

Case details: Mrs Manasi Indrajit Wadkar v. Union Bank of India - [2021] 129 taxmann.com 58 (NCLAT- New Delhi)

Judiciary and Counsel Details

    • A.I.S. Cheema, Judicial Member Officiating Chairperson and DR. Ashok Kumar Mishra, Technical Member
    • Krishnendu Datta, Abhishek Baid and Mohit Bafna, Advs for the Appellant.
    • Abhijeet Sinha, Rohan Aggarwal, Darshit Dave, A.K. Mishra, Almira Lasrado, Advs, Ms. Mamta Binani, Sandeep Bajaj and Devansh Jain, Advs. for the Respondent.

Facts of the Case

The Respondent bank filed an application under section 7 of the Insolvency and Bankruptcy Code, 2016 claiming that appellant-Corporate debtor availed financial assistance from various banks and financial institutions and its account was declared irregular and Non-Performing Assets on 29-6-2012.

However, the Adjudicating Authority found that there was debt due and default and that debt was within limitation and the application was admitted by the impugned order. On being aggrieved by the impugned order, the application filed in the Appellate Tribunal.

In appeal, the appellant claimed that its account was declared Non-Performing Assets (NPA) since 29-6-2012 and that debt was time-barred and application under section 7 of the IBC should have been rejected.

While the Respondent Bank claimed that there was an acknowledgement on part of a corporate debtor which showed that claim of the respondent bank was within limitation.

After hearing both the parties, the NCLAT noted that the financial debt and default was not time-barred and Adjudicating Authority had not committed any error in admitting the application filed under section 7 of the Insolvency and Bankruptcy Code, 2016

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