Anandkumar & Another vs Punjab National Bank & Anr

Anandkumar & another ...Appellants Versus Punjab National Bank & anr. ...Respondents

Present: For Appellants : Mr. S. D. Khati, Advocate

For 1st Respondent: Mr. Rajesh Kr. Gautam and Mr. Soumo Palit, Advocates

ORDER

16.03.2018 The appellants, shareholders of 'Corporate Debtor' has

challenged the order dated 14th February, 2018 passed by the Adjudicating

Authority (National Company Law Tribunal), Mumbai Bench whereby and

whereunder an application under Section preferred by the respondent - Punjab

National Bank (Financial Creditor) has been admitted, order of moratorium has

been passed and the Insolvency Resolution Professional has been appointed with

certain directions.

2. Learned counsel for the appellant submits that in the notice issued under

Section 433 of the Companies Act, 1956, the 'Financial Creditor' shown a lessor

amount whereas in the application under Section 7 higher amount of

Rs.79,10,51,494 has been shown as outstanding dues as on 31st May, 2017. It

is submitted that there being variation in the claim amount, this Section 7

application was not maintainable.

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3. Learned counsel appearing on behalf of the respondent brought to our

notice that in the notice under Section 433 the amount as was due on 30th April,

2016 was shown whereas in the application under Section 7, the amount as due

on 31st May, 2017 has been shown, which includes subsequent interest.

4. Similar issue fell for consideration before this Court in "Minitri Tea

Company Limited & Ors. Vs. Punjab National Bank in Company Appeal (AT)

(Insolvency) No. 237 of 2017". In the said case, this Appellate Tribunal by

order dated 22nd December, 2017 observed and held as follows:

9. In the present case, it is not disputed that there is a

debt due and default has accrued. The Appellant(s),

including the Corporate Debtor, has not claimed that

default has not occurred in the sense that the "debt"

includes disputed claim but not due. It is also not the

case of the Appellant(s) that the debt is not due nor

payable in law or in fact. The amount of debt, which is

the claim amount will always vary with the default of

debt amount which may be part of the claim and total

amount and may include interest.

10. In the present case as we find that the Respondent on

calculation of interest have shown the amount due and

default taken place, such records placed before the

Adjudicating Authority and record being complete if the

application under Section 7 of the I & B Code has been

Company Appeal (AT) (Insolvency) No. 96 of 2018 3

entertained as admitted, no interference is called for.

We find no merit in this appeal. It is accordingly

dismissed. However, in the facts and circumstances of

the case, there shall be no orders to cost."

5. As the case of the appellant is covered by the aforesaid decision, the first

ground taken by the appellant cannot be accepted.

6. Learned counsel appearing on behalf of the appellants next submits that

the amount claimed is barred by limitation. However, such submission cannot

be accepted. In "M/s. Speculum Plast Pvt. Ltd. vs. PTC Techno Pvt. Ltd. - Company

Appeal (AT)(Insolvency) NO. 47 of 2017", this Appellate Tribunal by judgment

dated 7th November, 2017 held :

68. In view of the settled principle, while we hold that the

Limitation Act, 1963 is not applicable for initiation of

'Corporate Insolvency Resolution Process', we further hold

that the Doctrine of Limitation and Prescription is

necessary to be looked into for determining the question

whether the application under Section 7 or Section 9 can

be entertained after long delay, amounting to laches and

thereby the person forfeited his claim.

69. If there is a delay of more than three years from the date

of cause of action and no laches on the part of the

Applicant, the Applicant can explain the delay. Where

there is a continuing cause of action, the question of

Company Appeal (AT) (Insolvency) No. 96 of 2018 4

rejecting any application on the ground of delay does not

arise."

7. In the present case, we find that there is a continuous cause of action

and interest has accrued during all the year and notice under Section 433 was

issued on 25th November, 2016 to which the appellants replied and objected

the claim. Therefore, it cannot be stated that there is delay of more than three

years from the date of cause of action and there is a laches on the part of the

respondent - Punjab National Bank. In absence of any merit, the appeal is

dismissed. No cost.

[Justice S.J. Mukhopadhaya] Chairperson

[ Justice Bansi Lal Bhat ] Member (Judicial)

/ns/gc

Company Appeal (AT) (Insolvency) No. 96 of 2018