| The Tax Publishers 2025 TaxPub(CL) 874 (NCLAT- New Del) INSOLVENCY AND BANKRUPTCY CODE, 2016
Section 7
Insolvency and Bankruptcy Code, 2016 - Section 61
The date of default in the arbitral award and in the application filed under section 7 of the code must be same. Change in such date does not extend the limitation period.
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CIRP - Application under section 7 admitted - Contention of time-barred application - Allowability of appeal
The corporate debtor was ordered for CIRP on account of filing of application under section 7. The same was admitted by the Adjudicating Authority. It was asserted that since the section 7 petition was time-barred, the Adjudicating Authority should have dismissed the section 7 petition at the very threshold.Held: For extending the period of limitation, the concerned parties were directed by the Apex Court to necessarily amend their pleadings. Once the section 7 application is filed, the date of default in Part-IV becomes binding. The respondent failed to bring about change in the date of default through a formal amendment in the section 7 petition. The date of default had been held to be the date of arbitral award by the Adjudicating Authority without the respondent having made a formal pleading to that effect. Thus, the Adjudicating authority had erred in extending the period of limitation basis the arbitral award. The matter was remanded back to the Adjudicating Authority to decide the matter afresh in accordance with law and on merits basis the amended pleadings.
REFERRED : Vidyasagar Prasad v. UCO Bank & Anr. [Civil Appeal No. 1031 of 2022] : 2024 TaxPub(CL) 1290 (SC), Dena Bank (now Bank of Baroda) v. C. Shivakumar Reddy & Anr. 2021 SCC Online SC 543 : 2021 TaxPub(CL) 1847 (SC), Asset Reconstruction Company (India) Limited v. Bishal Jaiswal & Anr. (2021) 6 SCC 366 (SC) : 2021 TaxPub(CL) 1112 (SC), Ramesh Kymal v. Siemens Gamesa Renewable Power Pvt Ltd. 2021 (3) SCC 224 (SC) : 2021 TaxPub(CL) 724 (SC), In Re : Cognizance For Extension of Limitation 2020 TaxPub(CL) 983 (SC), DBIRamdas Dutta Suspended Director of D.P. Agro Mills Pvt. Ltd. v. IDBI Bank Limited, Pankaj Kumar Tibrewal (2023) SCC Online NCLAT 1306 (SC), Vidyasagar Prasad v. UCO Bank, Kaizen Power Limited 2022 TaxPub(CL) 440 (NCLAT-Del) and Alchemist Asset Reconstruction Co. Ltd. v. Haryana Steel & Alloys Ltd. 2021 TaxPub(CL) 316 (NCLT-Chd).
FAVOUR : Application allowed.
A.Y. :
NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH , NEW DELHI
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