Axis Bank Limited vs M/S Krishidhan Seeds Private Limited

IN THE MATTER OF: Axis Bank Ltd. ...Appellant Versus Krishidhan Seeds Pvt. Ltd. ...Respondent

Present: For Appellant : Mr. Arjun Krishnan, Mr. Lalit Munshi, Mr. Arpit Lahoti & Ms. Siddhi Somani, Advocates.

For Respondent : Mr. Manu Agarwal, Mr. Kunal Vaishnaw, Mr. Shubham Budhiraja, Mr. Shivang Singhal & Ms. Ishita Pandey, Advocates.

ORDER

(Hybrid Mode)

[Per : Justice Rakesh Kumar Jain (Oral)]

05.05.2025 This appeal is directed against the order dated

08.07.2024 passed by National Company Law Tribunal, Indore Bench by

which an application filed under Section 7 of the Code by the Axis Bank

limited (Appellant) for the Resolution of an amount of Rs. 151 Crores

(approx.) has been dismissed on the ground of limitation.

Counsel for the Appellant has submitted that cash credit (CC) facility

of Rs. 45 Crores on 21.01.2011 was extended to the Respondent which was

renewed on 21.09.2012.

The 2nd renewal of the CC facility, an extension of the short term loan

of Rs. 15 Crores, was granted on 26.03.2013 which was acknowledged by

the Respondent vide its letter dated 28.03.2013.

The 3rd renewal of the CC took place on 10.12.2013 and the short

term loan outstanding was restructured to Rs. 4.69 Cores on 31.12.2013.

Counsel for the Appellant has submitted that the CC facility extended

to the Respondent was as classified as NPA on 01.05.2015, which is the

date of default as well. Thereafter, on 01.07.2015 a loan recall notice of

Rs. 48.08 Crores under the CC facility and Rs. 2.49 Crores under the short

term loan facility as on 30.06.2015 was issued.

It is further submitted that Respondent had made the OTS on

30.09.2015 but due to default in the part of the Respondent, the OTS was

withdrawn on 05.05.2016.

It is further argued that Respondent had admitted the liability in its

financial statement for the year 2016-17 and also further acknowledged the

debt in its letter dated 18.09.2017.

Counsel for the Appellant has also referred to the financial statements

from 31.03.2018, 2019, 2020, 2021 to 2022 to content that the amount

involved has been duly acknowledged and then pressed Section 18 of the

Limitation Act, 1963 to contend that with every acknowledgement the period

of limitation would start a fresh for a period of three years which is so

provided in Article 137 of the Limitation Act, 1963 for the purpose of filing of

an application under Section 7.

It is submitted that ultimately the application was filed on 28.01.2024

which was within the period of limitation but the aforesaid evidence, has not

been appreciated by the Learned Tribunal and therefore, the Impugned

Order is illegal and deserves to be set aside.

Counsel for the Respondent has though vehemently argued in support

of the Impugned Order but he could not deny the fact that the various

financial statements, which are part of the record, has not been taken into

consideration. In one way or the other for the purpose of adjudication as to whether the application filed by the Appellant under Section 7 is infact

within limitation or not.

Keeping in view the aforesaid facts and circumstances and looking

from every angle, we are of the considered opinion that it is a case in which

the Impugned Order has to be set aside and the matter should be remanded

back to the Learned Tribunal to decide it again after taking into

consideration the entire evidence available on record in respect of the

objection of the Respondent that the application filed under Section 7 was

beyond the period of limitation.

The appeal is thus allowed, the Impugned Order is set aside. The CP

(IB) No. 37 of 2024 is restored to its original number and the matter is

remanded back to the Learned Tribunal to decide the same a fresh.

It is pertinent to mention that while disposing of this appeal, we have

not made any observation on the merits of the case and the issue of

limitation has been kept open for the Learned Tribunal to decide. I.A., if

any, are closed

The parties are directed to appear before the Tribunal on 07.07.2025.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Mr. Naresh Salecha] Member (Technical)

[Mr. Indevar Pandey] Member (Technical) Sim/RR