NCLT Chandigarh (17.03.2020) in Edelweiss Asset Reconstruction Company Limited Vs. M/s Winsome Yarns Ltd. [CP (IB) No.291/Chd/CHD/2018] held that;
However, the various payments made by the corporate debtor starting from 31.03.2016 i.e. within 3 years from the date of default (17.01.2014) to 01.02.2018, definitely shift the period of limitation, for a further period of 3 years from 01.02.2018 and accordingly, we hold that the CP is within limitation.
Hon’ble Supreme Court of India while holding that an insufficiently stamped instrument cannot be relied upon for any purpose, however, observed that the concerned court has to follow the procedure provided under the Indian Stamp Act, 1899 for impounding the instrument before permitting a party to enforce the said insufficiently stamped instrument.
However, this Adjudicating Authority under the summary procedure provided under the Code cannot adopt such a procedure applicable to regular courts of law. Once the respondent-corporate debtor by placing reliance on the orders of the relevant Revenue Authorities able to show that the Annexure P-1 Assignment Agreement dated 10.12.2015 is unenforceable, ………. this Adjudicating Authority has no other option except to reject the CP.
Excerpts of the order;
# 12. The respondent-corporate debtor, inter alia, raised the following grounds, in support of its contention that the CP is liable to be dismissed.
(i) In view of the judgment of the Hon’ble Supreme Court of India in Dharani Sugars and Chemicals Limited Versus Union of India and Others; (2019) 5 Supreme Court Cases 480, the instant CP is liable to be dismissed in limine.
(ii) The CP is liable to be dismissed being barred by the period of limitation.
(iii) The petitioner is not a financial creditor of the respondent, as the Assignment Agreement dated 10.12.2015 (Annexure P-1) basing on which the petitioner stated to have acquired the rights from Punjab National Bank, the original financial creditor, is insufficiently stamped and hence unenforceable.
# 16. The instant CP has been filed on 25.05.2018. It is stated in Part 4 of Form-I that the date of default is 17.01.2014. Three years’ period of limitation, hence expired on 16.01.2017. Respondent submits that the CP having filed on 25.05.2018 is clearly barred by the period of limitation. On the other hand, the petitioner’s counsel submits that the respondent-corporate debtor in its 27th Annual Report 2016-17 dated 30.05.2017, acknowledged and admitted the debt due to the petitioner and hence the period of limitation, extended upto 29.05.2020 and since the CP having filed on 25.05.2018, is very well within the period of limitation. The petitioner further stated that as per Annexure P-71 statement of account of the respondent, it has made various payments from 31.03.2016 to 01.02.2018 towards the repayment of debt. Hence, the said payments also amount to acknowledgment of debt and accordingly, extends the period of limitation and therefore, the CP is well within the period of limitation. So far as admission and acknowledgement of debt in Annual Report 2016-17 dated 30.05.2017 is concerned, the same cannot save the limitation, as the date of annual report is admittedly beyond 3 years period from the date of default i.e. 17.01.2014. However, the various payments made by the corporate debtor starting from 31.03.2016 i.e. within 3 years from the date of default (17.01.2014) to 01.02.2018, definitely shift the period of limitation, for a further period of 3 years from 01.02.2018 and accordingly, we hold that the CP is within limitation.
# 18. It is the specific case of the petitioner EARC that the debt due to the PNB by the respondent-corporate debtor was assigned to it under the Annexure P-1 Assignment Agreement dated 10.12.2015 and by virtue of the same it has acquired all the rights of the PNB over the respondent-corporate debtor including the subject debt. It is also the case of the petitioner that the said Annexure P-1 Assignment Agreement dated 10.12.2015 was duly registered and duly stamped and is valid and legally enforceable for all purposes. On the other hand, the respondent-corporate debtor contends that the said Annexure P-1 Assignment Agreement dated 10.12.2015 was insufficiently and inadequately stamped and hence, cannot be relied upon for any purpose including for the purpose of maintaining the instant CA in the capacity of a financial creditor of the corporate debtor company.
# 22. A bare perusal of the above referred documents reveals that the concerned Revenue Authorities have found that the Annexure P-1 Assignment Agreement dated 10.12.2015 executed by PNB in favour of the petitioner-EARC was inadequately stamped and accordingly, it was directed to make payment of an amount of ₹1,45,85,000/- being the balance amount towards the insufficient stamp duty and registration fees on the Annexure P-1 Assignment Agreement dated 10.12.2015.
# 28. In SMS Tea Estates Private Limited Vs. Chandmari Tea Company Private Limited, (2011) 14 Supreme Court Cases 66 and Garware Wall Ropes Limited Vs. Coastal Marine Constructions and Engineering Limited, (2019) 4 Supreme Court Cases 2019 or in Chilakuri Gangulappa Vs. Revenue Divisional Officer, Madanpalle, Decided on 14.03.2001, Case No. Appeal (Civil) 1800 of 2001 and another, the Hon’ble Supreme Court of India while holding that an insufficiently stamped instrument cannot be relied upon for any purpose, however, observed that the concerned court has to follow the procedure provided under the Indian Stamp Act, 1899 for impounding the instrument before permitting a party to enforce the said insufficiently stamped instrument.
# 29. However, this Adjudicating Authority under the summary procedure provided under the Code cannot adopt such a procedure applicable to regular courts of law. Once the respondent-corporate debtor by placing reliance on the orders of the relevant Revenue Authorities able to show that the Annexure P-1 Assignment Agreement dated 10.12.2015 is unenforceable and when the petitioner not disputed the existence of said orders and not able to produce any stay order thereof, this Adjudicating Authority has no other option except to reject
the CP.
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