Hari Charan Gupta vs Mayapur Sales Private Limited

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI Company Appeal(AT) (Insolvency) No. 789 of 2022 IN THE MATTER OF: Hari Charan Gupta ...Appellant

Versus

Mayapur Sales Pvt. Ltd. ...Respondent

Present: For Appellant : Dr. Anurag Kr. Agarwal, Mr. Ram Gupta and Mr. Prateek Agarwal, Advocates.

For Respondent : Mr. Debal Kr. Banerji, Sr. Advocate with Ms. Priyata Chakraborty, Advocates.

ORDER

08.09.2022 Heard Dr. Anurag Kumar Agarwal, learned Counsel appearing

for the Appellant.

2. This Appeal has been filed against an order dated 24.05.2022 passed by

National Company Law Tribunal, Kolkata Bench, Kolkata by which Application

under section 7 of IBC, filed by the Appellant has been rejected.

3. The Appellant's case is that an amount of Rs. 1 Crore was given as a loan

to the Corporate Debtor in April, 2011. The amount became due on 25.07.2011.

The Appellant filed an Application under Section 7 on 29.01.2020. The

Adjudicating Authority by impugned order dated 24.05.2022 refused to admit

the application observing that the Financial Creditor can avail its remedies

elsewhere, if so desired and the application has been filed after expiry of three

years.

Company Appeal(AT)(Insolvency) No. 789 of 2022 Page 1 of 4

4. Mr. Anurag Kumar Agarwal, challenged the impugned order contends that

there have been acknowledgments in the balance sheet right from 2013-14 to

2018-19 and balance confirmation was given by the Corporate Debtor from

2014-15 to 2018-19. There have been tax deductions also in the years 2012-

13 and 2013-14. He submits that the Adjudicating Authority committed error

in rejecting the Application observing that the Financial Creditor did not initiate

any action against the Corporate Debtor within three years.

5. Mr. Debal Kr. Banerjee, learned Sr. Counsel appearing for the Respondent

submits that the documents showing balance confirmation are not admitted

and they have been manufactured. It is submitted that no balance sheet was

referred in Section 7 Application claiming extension of limitation under Section

18 of the Limitation Act.

6. We have considered the submissions made by the learned Counsel for the

Parties and perused the material on record. The balance sheets which have

been relied upon by the learned Counsel for the Appellant have been filed along

with the Appeal. The balance sheets were not referred in Section 7 Application,

but the learned Counsel for the Appellant submits that the balance sheets were

handed over to Adjudicating Authority.

7. Learned Counsel for the Appellant has referred to the balance sheet as on

31st March, 2013, which is filed as Annexure -A-21 at page -98 of the Appeal

Paper Book. Learned Counsel has referred 'Short Term Borrowings' which is as

follows:

"5. SHORT TERM BORROWINGS

Company Appeal(AT)(Insolvency) No. 789 of 2022 Page 2 of 4 Particulars 31/03/2013 31/03/2013 Amount (Rs.) Amount (Rs.) Unsecured Loans and Advances from 421,000.00 1,380,000.00 related parties.

Others 17,123,450.00 13,615,000.00 Total 17,544,450.00 14,995,000.00

8. Learned Counsel for the Appellant submits that in the column 'Others', an

amount of Rs. 17,123,450.00 as short term borrowing has been stated. The

learned Counsel for the Appellant contends that in the amount of Rs.

17,123,450.00 amount of Rs. 1 Crore was also included and hence stated that

the entry in the balance sheet is sufficient acknowledgment within the meaning

of Section 18 of the Limitation Act.

9. We are unable to accept to the submissions made by the learned Counsel

for the Appellant. In the short terms borrowing, a mere use of the word 'Others'

where an amount of Rs. 17,123,450/- has been mentioned, cannot be read to

mean that there is an acknowledgement of corporate debt to give benefit of

Section 18 of the Limitation Act to the Financial Creditor.

10. We are of the view that the entry of the balance sheet on which reliance

has been placed by the Appellant, cannot be read to give benefit of extension

of Section 18 of the Limitation Act and the Adjudicating Authority did not

commit any error in refusing to commence insolvency proceeding on the ground

that the Appellant failed to initiate any action against the Corporate Debtor

within three years. We further notice that the Adjudicating Authority in

paragraph-38 of the impugned order has observed:

Company Appeal(AT)(Insolvency) No. 789 of 2022 Page 3 of 4

"38. We, therefore, do not deem it fit to admit or entertain the

petition. The petition is, therefore, rejected. The Financial

Creditor can avail its remedies elsewhere if so desired."

11. Thus, we are of the view that the Adjudicating Authority itself has given

observation to the effect that remedy may be sought elsewhere, if so desired.

We do not find any error in the order of the Adjudicating Authority refusing to

admit Section 9 Application.

With these observations, we dismiss of the Appeal.

(Justice Ashok Bhushan) Chairperson

(Barun Mitra) Member(Technical) Akc/NN

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