The importance of providing an adequate opportunity of response to the corporate debtor and the admissibility of additional documents in the appellate stage.

JUDGMENT :

Dinesh Maheshwari, J.

1. Having regard to the short point involved and the contesting parties being represented, we have heard learned counsel for the parties finally at this stage itself.

2. By way of this appeal, the appellant-company, said to be the corporate debtor within the meaning of the Insolvency and Bankruptcy Code, 2016¹[Hereinafter also referred to as ‘the Code], has questioned the judgment and order dated 15.12.2021, as passed in Company Appeal (AT) Insolvency No. 981 of 2020 whereby, the National Company Law Appellate Tribunal, Principal Bench, New Delhi²[Hereinafter also referred to as ‘the Appellate Tribunal’ or ‘the NCLAT’.] has set aside the order dated 06.10.2020, as passed by the National Company Law Tribunal, New Delhi Bench-V³[Hereinafter also referred to as ‘the Adjudicating Authority’ or ‘the NCLT’.] in CP(IB) 841(ND) of 2020 and has also allowed the application moved by the applicant (respondent herein) under Section 9 of the Code.

The said application under Section 9 of the Code was filed by the applicant-respondent on 30.06.2020, in its capacity as an operational creditor of the corporate debtor while claiming, inter alia, that there had been a distribution agreement whereby, the corporate debtor was to sell the pharmaceutical products of the applicant company only until its subsidiary by the name “Kedrion India” was capable of doing so. Several invoices were raised in duration and credit notes were also issued. It has been the case of the applicant-respondent that as regards the debts due, a notice dated 25.07.2019 was sent, demanding a sum of USD 9,01,000 but, the said demand notice was returned undelivered. Thereafter, on 07.08.2019, another demand notice was sent at the new registered office address of the corporate debtor. The applicant alleged that on 17.08.2019, the corporate debtor replied to the said demand notice disputing the admitted and acknowledged the dues payable, with reference to its pending dispute with the Directorate of Health Services, Maharashtra with regard to the supply of short shelf-life products. The applicant contended that the corporate debtor had committed a default within the meaning of Section 3(12) of the Code and the outstanding amount qualified as an operational debt within the meaning of Section 3(11) read with Section 5(21) of the Code.

3. In its order dated 06.10.2020, the NCLT considered the documents referred by the applicant in support of its contention that there had been acknowledgment of debt and thereby the period of limitation would shift from the date of acknowledgment. The NCLT observed that the document dated 15.12.2017 was a credit memo, issued by the applicant and not by the respondent and thus, it could not be treated as an acknowledgment of debt. As regards document dated 07.07.2016 carrying the signatures of the Director of the Company and addressed to the Bank regarding payment of pending invoices, the NCLT observed that even if the said letter was treated as an acknowledgment of debt, the limitation would run from its date, i.e., 07.07.2016. The NCLT further considered another letter dated 02.02.2017 and observed that even if the said document was taken as an acknowledgement of debt, the limitation would run from 02.02.2017. Hence, the NCLT came to the conclusion that, viewed from any angle, the application filed on 30.06.2020 was beyond the period of three years in terms of Article 137 of the Limitation Act, 1963. Thus, the NCLT proceeded to reject the application so made by the respondent.

4. It appears from the perusal of the record that the applicant-respondent, in appeal against the aforesaid order of the NCLT, moved an application (I.A. No. 2685 of 2020) before the Appellate Tribunal and thereby, sought permission to produce the exchanges of e-mails from 03.11.2017 to 11.01.2019 with respect to the propositions for settlement of dues. Admittedly, the said documents were not on record before the NCLT.

5. However, the Appellate Tribunal