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Judgment
O R D E R
17.04.2023: Heard Learned Counsel for the Appellant. This appeal has been filed against the order dated 22.12.2022 passed by the Adjudicating Authority (National Company Law Tribunal, Kolkata Bench), by which application under Section 9 filed by the appellant has been rejected as barred by time, Section 9 application was filed by the Appellant claiming operational debt of Rs.1,99,94,021/-. In Part-IV the date of default was mentioned as 30.06.2016, the application under Section 9 was filed before the Adjudicating Authority on 08.06.2022, the Adjudicating Authority has rejected the application as barred by time.
Learned Counsel for the Appellant contends that the appellant had continued to work with the Respondent even after 30.06.2016, hence, he shall be entitled for extension of limitation under Section 18 of the Limitation Act, 1963. It is submitted that admission of the jural relationship by the Corporate Debtor with the appellant is sufficient to extend the limitation. He, however, submits that there was no pleading in the Section 9 application regarding any extension of limitation under Section 18. Learned Counsel for the appellant has also placed reliance on the Judgment of the Supreme Court in Tilak Ram and Ors. Vs. Nathu and Ors. [AIR 1967 SC 935].
We have considered the submissions of the Learned Counsel for the appellant and perused the record.
The date of default admittedly in the application is 30.06.2016 which is clear from Part-IV of the application. The application was filed on 08.06.2022 which was clearly beyond three years.
Submission of the counsel for the appellant is that he will be entitled for extension of Section 18 of the Limitation Act, 1963 because the appellant continues to work and respondent accepted the jural relationship even subsequently. Section 18 of the Limitation Act, 1963 provides as follows:
(1)Where, before the expiration of the prescribed period for a suit of application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing signed by the party against whom such property or right is claimed, or by any person through whom he derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
(2)Where the writing containing the acknowledgment is undated, oral evidence may be given of the time when it was signed; but subject to the provisions of the Indian Evidence Act, 1872 (1 of 1872), oral evidence of its contents shall not be received.
Explanation.—For the purposes of this section,—
(a)an acknowledgment may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come or is accompanied by a refusal to pay, deliver, perform or permit to enjoy, or is coupled with a claim to set-off, or is addressed to a person other than a person entitled to the property or right;
(b)the word “signed” means signed either personally or by an agent duly authorised in this behalf; and
(c)an application for the execution of a decree or order shall not be deemed to be an application in respect of any property or right.
The Section 18 contemplates acknowledgment of the debt in writing so as to give extension for the purposes of limitation.
Present is the case where there is no acknowledgment by the Respondent nor any such acknowledgment has been pleaded in the application. The submission that jural relationship continued is not sufficient to accept any extension of Section 18. The Judgment of the Supreme Court in Tilak Ram Vs. Nathu has considered the law and laid down following in Paragraph 10,11,12:
“10.It is not, however, necessary to go into the details of these decisions or to decide which of the two views is correct as this Court in Shapur Fredoom Mazda v. Durga Prosad, , has examined the contents and the scope of Section 19. After first stating the Ingredients of the section, this Court stated that an acknowledgment may be sufficient by reason of Explanation 1 even if it omits to specify the exact nature of the right. Nevertheless, the statement on which a plea of acknowledgment is based must relate to a subsisting liability. The words used in the acknowledgment must indicate the jural relationship between the parties and it must appear that such a statement is made with the intention of admitting that jural relationship. Such an intention, no doubt, can be inferred by implication from the nature of the admission and need not be in express words. It was then observed:- "If the statement is fairly clear then the intention to admit the jural relationship may be implied from it. The admission in question need not be express but must be made circumstances and in words from which he Court can reasonably infer that the per- on making the admission intended to refer to a subsisting liability as at the date of the statement."
11.The Court also observed that stated generally the Courts leaned in favour of a liberal construction of such statements though that would not mean that where no admission was made one should be inferred or where a statement was made clearly without intending to admit the existence of jural relationship such as intention would be fastened on the maker of the statement by an involved or a far-fetched process of reasoning. Similarly, while dealing with an admission of a debt, Fry L. J. in Green v. Humphreys, (1884) 26 Ch D 474 at p. 481, observed that an acknowledgment would be an admission by the writer that there was a debt owing by him either to the receiver of the letter or to some other person on whose behalf the letter was received but that it was not enough that he referred to a debt as being due from somebody. In order to take the case out of the statute there must, upon a fair construction of the letter read by the light of the surrounding circumstances, be an admission that the writer owed the debt.
12.The right of redemption no doubt is of the essence of and inherent in a transaction of mortgage. But the statement in question must relate to the subsisting liability or the right claimed. Where the statement is relied on as expressing jural relationship it must show that it was made with the intention of admitting such jural relationship subsisting at the time when it was made. It follows that where a statement setting out jural relationship is made clearly without intending to admit its existence an intention to admit cannot be imposed on its maker by an involved or a far-fetched process of reasoning.
Paragraph 12 of the judgment itself clearly mentioned that in admitting the jural relationship subsisting without intending to admit its existence an intention to admit any debt cannot be accepted the acknowledgment within meaning of Section 18.
The present is the case where application was clearly barred by time and there is no acknowledgment as per Section 18, hence, no extension of limitation can be claimed by the appellant. Appeal is without any merit and the same is dismissed.