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SUPREME COURT OF INDIA
Dinesh Maheshwari, Aniruddha Bose, JJ.
M/s Invent Asset Securitisation And Reconstruction Private Limited – Appellant
Versus
M/s Girnar Fibres Limited – Respondent
Civil Appeal No. 3033 of 2022
Decided On : 25-04-2022
Insolvency and Bankruptcy Code - Limitation - Section 7 of the Insolvency and Bankruptcy Code, 2016 - Section 18 of the Limitation Act, 1963
Fact of the Case:
The appellant's application under Section 7 of the Insolvency and Bankruptcy Code, 2016 was found to be barred by limitation as the right to sue accrued when the default occurred way back on 28.02.2002, and there was no evidence of acknowledgement of liability in terms of Section 18 of the Limitation Act, 1963.
Finding of the Court:
The National Company Law Tribunal and the National Company Law Appellate Tribunal rightly held that the application was barred by limitation. The intent of the appellant had only been to invoke the provisions of the Code for money recovery, which was not the intended purpose of the Code.
Issues: Whether the appellant's application under Section 7 of the Insolvency and Bankruptcy Code, 2016 was barred by limitation.
Ratio Decidendi: The court emphasized that the provisions of the Insolvency and Bankruptcy Code are intended to bring the corporate debtor to its feet and are not for money recovery proceedings. The absence of evidence of acknowledgement of liability under the Limitation Act, 1963 led to the dismissal of the appellant's application.
Final Decision: The appeal was dismissed, and it was observed that any other proceedings taken up by the appellant shall be dealt with on their own merits and in accordance with the law.
ORDER
1. Having heard learned counsel for the appellant and having perused the material placed on record, we are satisfied that the National Company Law Tribunal, Chandigarh Bench, Chandigarh and thereafter, the National Company Law Appellate Tribunal, Principal Bench, New Delhi have rightly taken the view that the application as moved by the present appellant under Section 7 of the Insolvency and Bankruptcy Code, 2016 ('the Code') was barred by limitation.
2. The Appellate Tribunal has, inter alia, pointed out that as per the averments and allegations, right to sue accrued when the default occurred way back on 28.02.2002; and that the material on record does not evidence any acknowledgement of liability in terms of Section 18 of the Limitation Act, 1963.
3. Learned counsel for the appellant has attempted to refer to the documents towards restructuring of the loan and the alleged revival letter etc. but we are satisfied that the said documents cannot enure to the benefit of the appellant so far as the application under Section 7 of the Code is concerned. The view as taken by the Tribunal and the Appellate Tribunal appears to be a plausible view of the matter on the given set of facts and circumstances of this case and, therefore, we are not inclined to interfere.
4. Time and again, it has been expressed and explained by this Court that the provisions of the Code are essentially intended to bring the corporate debtor to its feet and are not of money recovery proceedings as such. The intent of the appellant had only been to invoke the provisions of the Code so as to enforce recovery against the corporate debtor. We find no fault in the Tribunal and the Appellate Tribunal having declined the prayer of the appellant.
5. However, in the interest of justice, it does appear appropriate and hence observed that if any other proceedings have been or are taken up by the appellant, the same shall be dealt with and proceeded on their own merits and in accordance with law.
6. Subject to the observations foregoing, this appeal stands dismissed.
7. All pending applications stand disposed of.
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