Agrawal Poly Plast Private Limited vs Star Lamipacks Private Limited

Agrawal Poly Plast Pvt. Ltd. ...Appellant

Versus

Star Lamipacks Pvt. Ltd. Respondent

Present: For Appellant: Mr. Abhishek Chauhan, Advocate.

For Respondent:

ORDER

(Virtual Mode)

09.03.2022: Heard learned counsel for the Appellant. None has

appeared on behalf of the Respondent although notice has been served. The

Affidavit of Service in compliance of the order dated 06.12.2021 has also been

filed on 04.03.2022.

2. This Appeal has been filed against order dated 20.03.2020 passed by

the Adjudicating Authority (National Company Law Tribunal), Indore Bench at

Ahmedabad Court 1 by which the application filed by the Appellant under

Section 9 has been rejected as barred by time.

3. The Appellant has filed an application under Section 9 of the Insolvency

and the Bankruptcy Code, 2016 (hereinafter referred to as 'Code') on

04.06.2018 claiming total debt due of Rs.81,59,742/- comprising of

Rs.30,27,622/- as Principal Amount and rest as interest. The aforesaid

amount was claimed out of the bills and invoices which have been noticed in

Part IV of the application. It was stated in the application that last payment

was received on 09.07.2014 of Rs.2 Lakhs. The application also has

Cont'd.../ 2

mentioned about the confirmation of balance, acknowledgment of due to the

Operational Creditor by the Corporate Debtor. The Adjudicating Authority by

the impugned order dismissed the application. Para 14 of the impugned order

contains the observations of the Adjudicating Authority on basis of which

application was held as barred by time, which is to the following effect:

" OBSERVATIONS

14.

14.1 The Operational Creditor has filed Application for the Operational Debt default of Principal amount of INR.30,27,622.00 along with interest and Sales Tax Due.

14.2 The Operational Creditor has submitted the invoices in support of its claim but those invoices are from 19.04.2010 to 11.07.2011 which are almost 7 years old at the time of filing the Application.

14.3 Date of default is 16.02.2011. 14.4 One Payment of INR.2,00,000.00 has been received by the Operational Creditor on 09.07.2014 but the Application has been filed on 07.06.2018 which is beyond the Limitation period. There is no such written communication/clear acknowledgement of debts between the date of default i.e., 16.02.2011 till payment made on 09.07.2014, which is beyond three years.

Company Appeal (AT) (Insolvency) No. 530 of 2021 3

4. Learned counsel appearing for the Appellant submits that Appellant in

his application under Section 9 already made mention of the acknowledgment

which was given by the Corporate Debtor and last acknowledgment dated

31.05.2016 was specifically mentioned in the application. It is submitted that

the Corporate Debtor has continuously given acknowledgment in each year

which Account Confirmation has been brought on the record as Annexure A-

6 from the year 2010 till 2016.

5. We may notice the Part IV of the application where following statement

has been made recording the acknowledgment of debt of Rs.30,27,622/-:

"Accordingly, an amount of INR 30,27,622/- as

confirmed/ acknowledged by the Corporate Debtor is

still outstanding against the Corporate Debtor along

with interest at 2% due form the 31st day of the date of

respective unpaid invoices. Confirmation of balance/

Acknowledgement due to the Operational Creditor by

the Corporate Debtor dated 31.05.2016 of the principal

amount of operational debt of INR 30,27,622/- is

attached as Annexure -E."

6. It is well settled that on acknowledgment by Corporate Debtor of the

debt limitation is extended as per Section 18 of the Limitation Act, 1963.

Learned counsel for the Appellant submits that confirmation of account sent

by the Corporate Debtor from 01.04.2010 to 31.05.2016 were on the record of

the Adjudicating Authority where the debt of Rs.30,27,622/- was mentioned

Company Appeal (AT) (Insolvency) No. 530 of 2021 4

while confirming the account by the Corporate Debtor. The last confirmation

of account being issued on 31.05.2016 for the period 01.04.2016 to

30.05.2016, we are of the view that the Appellant can clearly claim the benefit

of Section 18 of the Limitation Act and application having been filed within

three years from the last letter of acknowledgment on 31.05.2016 the

application was well within time. The Adjudicating Authority has not referred

to the acknowledgment i.e. confirmation of accounts, which letters were issued

by the Corporate Debtor and which were on the record of the Adjudicating

Authority. The confirmation of account letters issued by the Corporate Debtor

to the Operational Creditor clearly extend the period of limitation for the

Appellant to file application under Section 9. We, thus, are of the view that

the Adjudicating Authority committed error in rejecting the application as

barred by time. The order impugned dated 20.03.2020 is set aside.

Application under section 9 being C.P.(IB) No. 319/9/NCLT/AHM/2018 is

revived before the Adjudicating Authority. The Adjudicating Authority after

issuing notice to the Appellant may pass an order for admission of the

application within a period of six weeks from the date copy of this order is

produced before the Adjudicating Authority. Parties shall be at liberty to enter

into settlement before the aforesaid date. Appeal is allowed accordingly.

[Justice Ashok Bhushan] Chairperson

[Dr. Alok Srivastava] Member (Technical) Archana/nn

Company Appeal (AT) (Insolvency) No. 530 of 2021