Laxmi Engineering Industries Pvt. Ltd. Vs. Canara Bank - (NATIONAL COMPANY LAW APPELLATE TRIBUNAL) (31 Aug 2023)

Litigation in the SARFAESI and DRT does not preclude the Bank to take specific remedy provided under Section 7 of IBC

MANU/NL/0760/2023

Insolvency

Present Appeal has been filed against the order passed by the Adjudicating Authority (National Company Law Tribunal) Indore Bench, by which Application filed by the Canara Bank under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) has been admitted. The Appellant contends that the Application is barred by time and he further submits that the Bank has approached several forums including the DRT. It is further submitted that the talks regarding OTS are still going on.

In the present case, NPA was declared on 04.06.2018 and thereafter the Adjudicating Authority has noticed that in reply, the Appellant has acknowledged the debt and thereafter OTS was submitted by the Appellant. The Adjudicating Authority has come to the conclusion that the acknowledgment in the reply as well as OTS offer makes the Application within time. Application was filed on 20th December, 2022. Present Court have looked into the acknowledgment and reply which was in the year 2018 itself and thereafter within three years there has been OTS proposal by the Appellant, hence, the Bank was clearly entitled for the benefit of Section 18 of the Limitation Act, 1963 and the Adjudicating Authority has rightly held that Application was within time.

With regard to the submission of the Appellant that Bank has approached the multiple forums including the DRT is concerned, it is well settled that, litigation in the SARFAESI and DRT does not preclude the Bank to take specific remedy provided under Section 7 of IBC, hence, the said submission does not help the Appellant.

The last submission of the Appellant that the Corporate Debtor is taking steps for the OTS settlement, present Tribunal only observe that in event any OTS is accepted, it shall be open for the Appellant to file an Application before the Adjudicating Authority for closing the settlement under Section 12A which may be considered in accordance with law.Appeal dismissed.

Tags : SETTLEMENT APPLICATION PROVISION