Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | 2016 Insolvency and Bankruptcy Code |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case(s) Referred | Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3 Referred Case 4 |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Dismissed |
Headnote | Insolvency and Bankruptcy Code, 2016 – Arbitration and conciliation Act, 1996 – Limitation Act, 1963 – Limitation Period – Insolvency – Appointment of Arbitrator – Freezing of limitation during the moratorium period – Appellant (NDMC) placed a purchase order with the Respondent (MIL) – Due to the failure on part of the Respondent to perform its obligation as per the existing agreement, NDMC terminated the agreement – On June 7, 2016, the Respondent (MIL) issued the notice for commencement of the arbitral proceeding as per the provisions provided under the A&C Act, 1996 – Before the commencement of the arbitral proceedings, insolvency proceedings started against the Respondent(MIL) on May 14, 2018 by the orders of NCLT – On November 28, 2019, the Resolution Plan to resolve the insolvency of the Respondent was sanctioned by the Tribunal – On the same date i.e. November 28, 2019, the Respondent(MIL) filed an application for appointment of the arbitrator before the High Court of Delhi as per s. 11(6) of the 1996 Act – The application for appointment of the arbitrator was allowed by the High Court on December 14, 2020 – Appellant did not raised any objection to the issue of limitation before the High Court – Before the Supreme Court, the appellant (NDMC) contended that the notice of commencement of the arbitration proceedings was dated June 7, 2016 and the application for appointment of an arbitrator has to be filed within the period of 3 years from the date on which the notice of commencement of the arbitral proceedings commenced – The application for appointment of arbitrator was made by the respondent on November 28, 2019 which is beyond the time period of three years – Also, the Respondent is not protected by the moratorium imposed under Section 60(6) read with Section 14 of the IBC, 2016 (period of limitation) – Held: an application under Section 7, 9 or 10, does bring in a period which is intended to bring a corporate debtor back to life if possible, ‘a period of calm’, in the words of the respondent – But this is a period during which the management of the corporate debtor is displaced, ironically, a period of turbulent churning – While it may be true that proceedings by the corporate debtor through the resolution professional is contemplated, it is not impossible to contemplate that the resolution professional for whatever reason it may be, does not discharge his duties and conduct proceedings in all matters as he should – This as can be the rationale for the Law Giver excluding the period of limitation in regard to suits or applications at the instance of the corporate debtor under Section 60(6) – In the instant case, an order of Moratorium under Section 14, the entire period of the Moratorium is liable to be excluded in computing the period of limitation even in a suit or an application by a corporate debtor. |
Judge | Hon'ble Mr. Justice K.M. Joseph |
Neutral Citation | 2022 INSC 486 |
Petitioner | New Delhi Municipal Council |
Respondent | Minosha India Limited |
SCR | [2022] 16 S.C.R. 1072 |
Judgement Date | 2022-04-27 |
Case Number | 3470 |
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