Back
2026 Supreme(SC) 465
SUPREME COURT OF INDIA
PAMIDIGHANTAM SRI NARASIMHA, ALOK ARADHE, JJ.
Shankar khandelwal – Appellant
Versus
Omkara Asset Reconstruction Pvt. Ltd & Anr. – Respondents
Civil Appeal No(s). 13158-13159 of 2025
Decided On : 29-04-2026
For the Appellant(s) : Mr. Shubham Jain, AOR
For the Respondent(s): Mr. Neeraj Kishan Kaul, Sr. Adv. Mr. Gaurav Agarwal, Sr. Adv. Mr. Himanshu Shekhar Tripathi, AOR Ms. Sejal Jain, Adv. Ms. Kaarunya Lakshmi, Adv. Mr. Nakul Patwardhan, Adv. Mr. Dhanya S Krishnan, Adv. Mr. Raghav Agarwal, Adv.
IMPORTANT POINTS
(1) Initiation of Corporate Insolvency Resolution Process – Limitation for filing application under Section 7 of IPC is three years and is governed by Article 137 of 1963 Act – Limitation begins to run from date of classification of account as NPA.
(2) Initiation of Corporate Insolvency Resolution Process – Limitation period can be extended only by an acknowledgment which is made within period of limitation.
Headnote:
(A) Insolvency and Bankruptcy Code, 2016 – Section 7 – Limitation Act, 1963 – Article 137 – Corporate Insolvency Resolution Process – Initiation of – Bar of limitation – Application under Section 7 of Code is governed by Article 137 of 1963 Act – Limitation for filing application under Section 7 of Code is three years and is governed by Article 137 of 1963 Act – Limitation begins to run from date of classification of account as NPA, being date of default, and not from any subsequent proceeding initiated for recovery – In instant case, accounts of CD were declared NPA on 06.12.2016 – Right to file petition under Section 7 of Code accrued on 06.12.2016 – Petition under Section 7 was filed on 23.09.2024 which is well beyond period of limitation. (Paras 13, 14 and 15)
(B) Insolvency and Bankruptcy Code, 2016 – Section 7 – Limitation Act, 1963 – Section 18 – Corporate Insolvency Resolution Process – Initiation of – Extension of period of limitation – Admission of liability – For a writing to constitute a valid acknowledgment, it must be made by party against whom right is claimed, or by a person duly authorized on its behalf; it must be made before expiration of prescribed period of limitation; and it must evince conscious and unequivocal intention to admit a subsisting jural relationship and an existing liability – Mere reference to a past transaction or a bald recital of a debt, without an intention to admit liability, would not suffice – Admission of claim by RP is merely an administrative/clerical task performed as part of its statutory duties under Section 18 of Code – Admission of a claim by RP is akin to mere recital/reference of debt, which does not amount to an acknowledgment under Section 18 of 1963 Act. (Para 16)
(C) Limitation Act, 1963 – Section 18 – Insolvency and Bankruptcy Code, 2016 – Section 7 – Corporate Insolvency Resolution Process – Initiation of – Extension of period of limitation – Admission of liability – Acknowledgment under Section 18 of 1963 Act can only extend/renew a limitation period which has not already expired – Limitation period can be extended only by an acknowledgment which is made within period of limitation – Admission of claim of secured financial creditor does not enure to benefit of secured financial creditor as same was not made within period of limitation – Impugned judgment and order passed by NCLAT and NCLT quashed and set aside. (Paras 17 and 18)
Facts of the case:
Present appeals under Section 62 of the Insolvency and Bankruptcy Code, 2016, are directed against impugned judgment dated 15.10.2025 passed by National Company Law Appellate Tribunal (NCLAT), whereby the order dated 22.01.2025 passed by the National Company Law Tribunal (NCLT), admitting two separate petitions under Section 7 of the Code and initiating the Corporate Insolvency Resolution Process (CIRP), has been affirmed. Central question that arises for determination in these appeals are whether the application filed under Section 7 of Code by the secured financial creditor was within period of limitation.
Findings of Court:
After reckoning three years from 06.12.2016 and excluding the above referred periods, only three days remain from 29.07.2024 which would expire on 01.08.2024. However, petition under Section 7 was filed on 23.09.2024 which is well beyond the period of limitation.
Result : Appeals allowed.
JUDGMENT :
ALOK ARADHE, J.
1. These appeals under Section 62 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as “the Code”), are directed against the impugned judgment dated 15.10.2025 passed by the National Company Law Appellate Tribunal (NCLAT), whereby the order dated 22.01.2025 passed by the National Company Law Tribunal (NCLT), admitting two separate petitions under Section 7 of the Code and initiating the Corporate Insolvency Resolution Process (CIRP), has been affirmed.
2. The central question that arises for determination in these appeals are whether the application filed under Section 7 of the Code by the secured financial creditor was within the period of limitation.
FACTS
3. The facts giving rise to the filing of these appeals, briefly stated, are that the appellant is the erstwhile Director of Shrinathji Business Ventures Private Limited and Samaria Business Ventures Private Limited (Corporate Debtors). Two separate loans were sanctioned by Dewan Housing Finance Corporation Ltd., (DHFL) in September 2014 for sums of Rs.12 crores and Rs.11 crores, out of which Rs.11.50 crores and Rs.11 crores respectively were disbursed. The corporate debtors defaulted in repayment, and on 06.12.2016, DHFL classified their accounts as Non-Performing Assets (NPA). Subsequently, DHFL itself entered CIRP pursuant to proceedings initiated by the Reserve Bank of India, and on 07.06.2021, a resolution plan submitted by Piramal Capital & Housing Finance Ltd., (PCHFL) was approved by the NCLT, Mumbai. On 10.01.2021, PCHFL assigned the subject loans to Omkara Asset Reconstruction Pvt. Ltd., the secured financial creditor.
4. Following the termination of the earlier CIRP, the secured financial creditor filed an application under Section 7 of the Code on 23.09.2024 against the corporate debtor. By order dated 22.01.2025, the NCLT held that the application was within limitation and admitted the same.
5. The appellant challenged the aforesaid order in appeal. By order dated 15.10.2025, the NCLAT, inter alia, held that the admission of the claim by the Resolution Professional (RP) in the first CIRP against the corporate debtor on 22.05.2022 constituted a valid acknowledgment, and its subsequent updating on 21.01.2024 constituted a second acknowledgment. It was further held that, if limitation is computed from either of these dates, the debt is not time-barred. Accordingly, the NCLAT concluded that the petition under Section 7 of the Code was within limitation and affirmed the order of the NCLT. In this factual background, the present appeals arise for consideration.
SUBMISSIONS
6. Learned senior counsel for the appellant submitted that the date of default of corporate debtor was 06.12.2016 and the limitation would have expired on 06.12.2019. It is, however, submitted that the period of limitation remained suspended from 03.12.2019 to 29.04.2024 in view of mandate contained in Section 60(6) of the Code. However, the period of limitation expired three days after 29.04.2024, whereas, the petition under Section 7 of the Code was filed by the secured creditors on 23.09.2024, and was thus barred by limitation.
7. It is further contended that admission of debt by an Interim Resolution Professional (IRP) cannot be equated with an acknowledgment of liability under Section 18 of the Limitation Act, 1963 (hereinafter referred to as “the 1963 Act”). It is urged that the admission of claims is merely an administrative function of the IRP under Section 18 of the Code. It was argued that the IRP’s admission of the secured financial creditor’s claim in the first CIRP does not constitute an acknowledgment under Section 18 of the 1963 Act. Accordingly, it is submitted that the application under Section 7 of the Code was filed beyond the prescribed period of three years and is barred by limitation. In support of the aforesaid submissions, reliance was placed on the decisions of this Court1[Babulal Vardharji Gurjar v. Veer Gurjar, (2020) 15 SCC 1; Pra
