The IBC is not just another statute for recovery of debts, says SC

Last updated: 07 August 2021

Save Share

Quick Summary

The Supreme Court has ruled that the Insolvency and Bankruptcy Code (IBC) is not merely a statute for recovering debts. It clarified that an application under Section 7 of the IBC will not be barred by limitation if there was an acknowledgement of debt by the corporate debtor within the limitation period. Such an acknowledgement extends the limitation by a further three years, providing a fresh cause of action.

Court :
SUPREME COURT OF INDIA

Brief :
This Appeal under Section 62 of the Insolvency and Bankruptcy Code, 2016 (IBC) is against a judgment and final order dated 18th December 2019 passed by the National Company Law Appellate Tribunal (NCLAT), allowing Company Appeal (AT) (Insolvency) No.407 of 2019, filed by the Respondents and setting aside an order dated 21st Section 7 of the IBC. The NCLAT held that the said Petition of the Appellant Bank under Section 7 of the IBC, was barred by limitation. The Respondent No.1 is a Director of the Corporate Debtor. March 2019 passed by the Adjudicating Authority/National Company. Law Tribunal (NCLT), Bengaluru, whereby the Adjudicating Authority had admitted the Petition being CP(IB) No.244/BB/2018 filed by the Appellant Bank against the Respondent No.2 (Corporate Debtor) under

Citation :
CIVIL APPEAL NO.1650 OF 2020

Daily Limit Reached