Amendments to insolvency petitions cannot alter fundamental details such as the date of default, especially when originating facts were previously known, as it undermines procedural integrity.

PER: SH. L. N. GUPTA, M(T) & SH. HARNAM SINGH THAKUR, M(J)

The present IA No. 1036/2024 has been filed by the Applicant Punjab National Bank u/s 60 (5) of IBC, 2016 to amend the pleadings in its original Section 7 petition bearing CP (IB) NO. 192/CHD/PB of 2023 and to allow the present Application filed with the amended application in Form-I, appended therewith. The last para of the IA reads thus:

2. The Applicant has submitted in its application that the main petition was fixed for 16.04.2024 for filing Rejoinder of the Applicant Financial Creditor. It is further stated that in the Reply to the main Petition, the Corporate Debtor mentioned that the Petition was barred under Section 10A of the IBC, 2016 as the date of default mentioned by the Applicant Bank is falling within the restricted period of of IBC, 2016.

3. It is further stated by the Applicant that in the main Section 7 petition, the Applicant Bank mentioned the date of default as 31.01.2021, whereas Date of NPA was 02.05.2021. And the Applicant Bank wishes to amend the said section 7 petition while restricting its amount of debt only to the extent of "Working Capital Term Loan Facility" (WCTL) sanctioned to the Respondent/CD for an amount of Rs. 46 Crore on 04.03.2021. Under this facility, the amount was re-payable by the CD in 48 monthly installments with 12 months’ moratorium with re-payment starting from 31.03.2022, but the account was declared as NPA on 02.05.2021 due to the percolation i.e., when other accounts of the CD were declared NPA on 02.05.2021 and as such this account was also declared NPA. The aforesaid default is continuing and as such date of default for the purpose of Section 7 petition can be taken as 02.05.2021.

4. Further, the Applicant has appended the amended application in Form-I at Annexure-2 (from pages 15-33) of the present Application.

5. The Applicant Bank has further stated that in the Record of Default issued by NeSL, the date of default is recorded as 02.05.2021, whose authenticity the debtor cannot dispute. It further states that in a section 7 petition, date of default or pleadings can be amended at any stage of the matter. The National Company Law Tribunal (NCLT), New Delhi Bench in PHL Fininvest Private Limited v/s Kay Jay Leasing Limited allowed an application for amendment of the date of default and held that the amendment of pleadings in a CIRP application filed under Section 7 of IBC can be done at any stage of the matter. The Applicant has relied upon the judgment of the Hon’ble Apex Court in the case of Dena Bank (Bank of Baroda) versus C. Shivakumar Reddy and Another (2021 10 SCC 330) .

6. On issuance of the notice, the Respondent filed its reply dated 02.05.2024 contending mainly the following:

6.1 The main Section 7 petition was filed by the Applicant Bank on 27.06.2023 and it was only when the answering respondent filed its detailed reply, the Applicant Bank is now trying to change the very nature of the petition which cannot be done at this juncture of time as per whims and fancies of the Applicant Bank.

6.2 An application for amendment can be allowed to be made by a party only in a case where there are new facts, that arose after filling of the insolvency petition, which is not the case presently. The applicant bank was very much aware of the all the averments made in the petition. The ’Doctrine of Waiver’ is applicable in the present matter and the bank, who voluntarily waived its right of raising such averments at the time of filing the original insolvency petition cannot be allowed to backtrack from the same at this fag end.

6.3 The present ap