Abhijit Jasrasaria vs Jop International Limited
- CitationComp. App. (AT) (Ins.) No. 187 of 2021
Ratio decidendi
The rule this decision rests on
Where the financial debt is an amount deposited under a buyer's agreement and the default is pleaded as the date on which possession was due, an application under Section 7 of the Insolvency and Bankruptcy Code is governed by the three-year limitation period in Article 137 of the Limitation Act, running from when the right to apply accrues; where the applicant's own pleaded date of default is outside that period, the application is time-barred and cannot be entertained. A continuing failure to deliver possession does not extend or restart that limitation period for an application under Section 7 where the applicant has pleaded a specific earlier date of default and has not pleaded any other date from which fresh limitation runs. A pending or prior remedy before the Real Estate Regulatory Authority does not bar a litigant from invoking the Insolvency and Bankruptcy Code, but it does not cure a Section 7 application that is otherwise barred by limitation.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Abhijit Jasrasaria ....Appellant Vs. JOP International Ltd. ...Respondent For Appellant: Mr. P.K. Sachdeva, Advocate. For Respondent: Mr. Aayush Malhotra, Mr. Soham Kumar, Ms. Prarthana Singhania, Advocates.
ORDER
(Through Virtual Mode)
07.02.2022: Heard Learned Counsel for the Appellant and Learned
Counsel for the Respondent.
2. This Appeal has been filed against the order dated 07.01.2021 passed
by the Adjudicating Authority (National Company Law Tribunal), New Delhi
Bench-V by which Application filed by the Appellant under Section 7 of the
'I&B Code' has been rejected. The Appellant has filed an Application under
Section 7 claiming dues of Rs. 87,38,000/- which was deposited by him
towards cost of shops through Buyers' Agreement dated 24.02.2009. Copy of
the Application filed under Section 7 has been brought on record at page 116
of the paper book. Part IV of the Application which gives the 'particulars of
the financial debt' is to the following effect:- 2
Part-IV
PARTICULAR OF FINANCIAL DEBT
1. TOTAL AMOUNT OF DEBT Rs.87,38,000/- deposited GRANTED towards the cost of the shops acknowledged DATE(S) OF DISBURSEMENT through Buyers Agreement dated 24.02.2009 + Intt. Rs.
32496260/- in Aggregate.
2. AMOUNT CLAIMED TO BE IN As per the Agreement dated DEFAULT AND THE DATE ON 24.02.2009. The Financial WHICH THE DEFAULT Creditor was to get the OCCURRED possession of the property within 12 months from the date of signing the BA i.e. 24.02.2010, hence the initial date of default is 24.10.2010, which is still continuing as no possession till date.
(ATTACH THE WORKINGS FOR Working for Computation of COMPUTATION OF AMOUNT AND amount and days is DAYS OF DEFAULT IN TABULAR annexed herewith and FORM) marked as ANNEXURE P-3.
3. The date of default given by the Appellant himself is 24.10.2010. The
Application under Section 7 has to be filed within the limitation as provided
under Article 137 of the Limitation Act i.e. within three years from "when the
right to apply accrues".
4. Learned counsel for the Appellant submits that since the possession
has not been delivered he has continuing cause of action and his right to file Comp. App. (AT) (Ins.) No. 187 of 2021 3
Petition/ Application is still continuing and Application cannot be said to be
barred by time.
5. Learned Counsel for the Respondent submits that the Appellant has
already filed execution of the order passed by the RERA dated 06.03.2019 in
favour of the Appellant in pursuance of which execution has already been
ordered on 18.11.2021, due to which fact the Application under Section 7
need not be entertained.
6. Learned Counsel for the Appellant submits that he has right to take
his remedy before RERA as well as under Section 7 of the Code.
7. We have considered the submissions of the Learned Counsel for the
parties and perused the record.
8. Insofar as submission of the Counsel for the Appellant that he has
right to avail all the remedies provided in law is concerned, we concur with
the submission, a litigant can avail all the remedies provided in law, be it
complaint filed under Real Estate Regulatory Authority or under IBC. We in
the present case are concerned with the Application filed by the Appellant
under Section 7 of the IBC. In Part-IV of the Application which we have
already extracted above, the Appellant himself has shown the date of default
as 24.10.2010. The limitation for filing an Application under Section 7 is
provided under Article 137 of the Limitation Act which is to the following
effect:-
Comp. App. (AT) (Ins.) No. 187 of 2021 4
Description of application Period of limitation Time from which period begins to run
137. Any other application Three years When the right to apply for which no period of accrues.
limitation is provided elsewhere in this division
9. To meet the limitation provided under Article 137, submission of the
Counsel for the Appellant is that he has a continuing cause of action since
as per Agreement dated 24.02.2009, the Appellant had not been given
possession of the shops. The fact that Appellant was not given possession of
the shops by the Corporate Debtor may be ground and reason for filing
complaint under Real Estate Regulatory Authority Act before UP RERA which
complaint has already been filed by the Appellant and was allowed on
06.03.2019 but for filing Application under Section 7, Application has to be
within three years from the date when right to apply accrues. When default
of a financial debt was committed on 24.10.2010 as claimed by the
Appellant, the right to apply accrue to him and no other date of default
having been given in Part-IV, the limitation shall not stop running merely
because Appellant claims that he has not been given possession of the
shops. The Application was thus clearly barred by time and could not have
been entertained by the Adjudicating Authority. The Application having been
filed beyond three years from the date when right to apply accrues, the same
deserves to be rejected.
Comp. App. (AT) (Ins.) No. 187 of 2021 5
10. Learned Counsel for the Appellant lastly contended that he will have
fresh period of limitation after the order dated 06.03.2019 passed by the UP
RERA. The said submission needs no consideration since neither there was
any foundation in the Application filed under Section 7 nor there was any
pleading that fresh period of limitation shall start from 06.03.2019. Hence,
we need not consider the said submission in the present Appeal.
11. As noted above, on the complaint filed by the Appellant, an order has
been passed by the UP RERA on 06.03.2019 directing for recovery of amount
of Rs. 87,38,000/- along with interest/. The Appellant has already filed
Execution Application to execute the order dated 06.03.2019 which as per
submission of the counsel for the Appellant has already been allowed on
18.11.2021.
12. In view of the above, we see no reason to interfere with the order
passed by the Adjudicating Authority dismissing Section 7 Application filed
by the Appellant. The Appeal is dismissed.
[Justice Ashok Bhushan] Chairperson
[Dr. Ashok Kumar Mishra] Member (Technical)
[Dr. Alok Srivastava] Member (Technical) Anjali/nn Comp. App. (AT) (Ins.) No. 187 of 2021
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