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Judgment
O R D E R
14.09.2023: Heard Mr. Harshit Khare, Ld. Counsel for the Appellant as well as Mr. Arpit Singhvi, Ld. Counsel who appeared on behalf of the Respondent.
The present appeal has been preferred under Section 61 of the Insolvency and Bankruptcy Code, 2016 (herein after referred to as ‘Code’) against an order dated 09.02.2023 passed by National Company Law Tribunal, Mumbai Bench-IV (herein after referred to as ‘Adjudicating Authority’) in CP (IB) No. 1446/MB-IV/2020. By the said order the Adjudicating Authority has rejected the petition filed under Section 7 of ‘Code’ on behalf of the Appellant/Financial Creditor primarily on the ground of limitation.
The Appellant had filed an application under Section 7 of the Code before the Adjudicating Authority on an allegation that there was default in payment of Rs. 98,19,09,715.15 (Rupees Ninety Eight Crore Nineteen Lakh Nine Thousand Seven Hundred Fifteen and Fifteen Paise only). It is not in dispute that account was declared Non-Performing Asset (‘NPA’) on 28.12.2015. It is case of the Appellant that since the payment was not made, the Bank had approached the Debt Recovery Tribunal (‘DRT’) wherein a settlement agreement was filed. The settlement agreement dated 14.03.2018 was part of the proceeding before the DRT wherein Respondent had agreed for payment of Rs. 9,40,00,000/- (Rupees Nine Crores and Forty Lakhs Only).
However, the Adjudicating Authority had noticed that One Time Settlement (‘OTS’) proposal was dated 06.12.2021 and as such the Adjudicating Authority had concluded that the application was barred by limitation, since three years had already expired after the account was declared NPA. It appears that despite the fact that the appellant had brought to the notice of the Adjudicating Authority the fact regarding settlement of the parties dated 14.03.2018, it went unnoticed by the Adjudicating Authority. Ld. Counsel for the Respondent has not disputed the fact that Settlement Proposal was dated 14.03.2018. Meaning thereby that after the account was declared NPA on 28.12.2015, within three years Settlement had already taken place on 14.03.2018. In such view of the matter there was no reason to dismiss the application filed under Section 7 of the Code primarily on the ground of limitation.
Since, the fact regarding the earlier Settlement of 2018 went unnoticed, we are of the opinion that impugned order dated 09.02.2023 can be set aside and matter is remitted back to the Adjudicating Authority to examine the application filed under Section 7 of the Code, without being influenced by the earlier order since it has already been admitted by the Respondent that Settlement had taken place on 14.03.2018 within three years from the date of declaring the account as NPA on 28.12.2015.
Ld. Adjudicating Authority without being influenced with this order may examine the application filed under Section 7 of the Code by the Appellant/Financial Creditor and pass order expeditiously in accordance with law. For abundant precaution the appellant is granted liberty to bring on record before the Adjudicating Authority Settlement Agreement dated 14.03.2018 in which the Respondent/Corporate Debtor had acknowledged the debt and agreed to pay Rs. 9,40,00,000/- (Rupees Nine Crores and Forty Lakhs Only). Both the parties have agreed to appear before the Adjudicating Authority within three weeks from today.
Accordingly, the appeal is allowed.