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Judgment
O R D E R
26.02.2024: Heard learned counsel for the Appellant. This Appeal has been filed against order dated 11.01.2024 by which order I.A. No.71 of 2024 filed by the Appellant under Rule 11 seeking dismissal of the main Company Petition has been rejected and the Adjudicating Authority granted two weeks’ time to the Corporate Debtor to file Reply.
Learned counsel for the Appellant challenging the order contends that the Appellant has filed I.A. No.71 of 2024 raising the issue that the Section 9 application being barred by time should be rejected at the outset. It is submitted that the Adjudicating Authority does not have jurisdiction to proceed with the petition if the petition is barred by time. Learned counsel for the Appellant has placed reliance on judgments of the Hon’ble Supreme Court in “AIR 1964 SC 1336, Manindra Land and Building Corporation Ltd. vs. Bhutnath Banerjee and Others, Para 9”, the Judgment of Hon’ble Supreme Court in “B. K. Educational Services Pvt. Ltd. vs. Parag Gupta and Associates, (2019) 11 SCC 633, Paras 12, 43 & 44” as well as judgment in “AIR1962 SC 1621, Ujjam Bai vs. State of U.P., Para 19”.
Learned counsel for the Appellant submits that the Section 3 of the Limitation Act casts duty on the Court to reject an application which is barred by time even if no defence has been raised by the Corporate Debtor.
The order passed by the Adjudicating Authority is in an application filed under Section 9 of the I&B Code. I&B Code provides for procedure for consideration of application. NCLT Rules, 2016 provides for issuance of notice to the Corporate Debtor who is required to file a reply for opposing the application. There cannot be any dispute to the proposition that if an application is barred by time, the application deserved to be rejected. However, the issue whether the application is barred by time or not is a mixed question of law and facts. Having apprised with the relevant facts, the Court will be able to decide the question of limitation. The Appellant who is Corporate Debtor had been given time to file reply. The Adjudicating Authority has taken a view that after receiving the reply of the Appellant, the Adjudicating Authority shall proceed with the main petition. The IBC being proceedings which has timelines, if the Adjudicating Authority proceed to decide the issue raised by the Appellant along with main petition, no fault can be found with the decision of the Adjudicating Authority at this stage. It is open for the Appellant, to file its reply affidavit before the Adjudicating Authority raising all issues including the issue of limitation. We have no doubt that the Adjudicating Authority shall consider the issue of limitation while deciding the Section 9 application, in accordance with law. With these observations, we dismiss the appeal.