# In the matter of Akram Khan Vs. Bank of India Limited  & Ors. Company Appeal (AT) (Insolvency) No. 1092 of 2019

> NCLAT judgment dated 2019-12-19. Citation: TCN-2019-NCLAT-00007. The Bank of India Limited, the Financial Creditor, initiated a Corporate Insolvency…

- **Court:** NCLAT
- **Order date:** 19 Dec 2019
- **Citation:** TCN-2019-NCLAT-00007
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/akram-khan-vs-bank-of-india-limited-ors-company-appeal-0f1e88f3

## Summary

### Background

The Bank of India Limited, the Financial Creditor, initiated a Corporate Insolvency Resolution Process (CIRP) against Poonam Drums and Containers Private Limited under Section 7 of the Insolvency and Bankruptcy Code, 2016 (I&B Code). The Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, admitted the application, leading to the appointment of an Interim Resolution Professional. Akram Khan, the Director of the Corporate Debtor, challenged this order, arguing that the application was barred by limitation.

## Facts

Poonam Drums & Containers Pvt. Ltd. defaulted on debt payments on June 11, 2015. Bank of India Limited classified the account as a Non-Performing Asset (NPA) on September 29, 2015. Bank of India Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 to initiate Corporate Insolvency Resolution Process (CIRP). The Adjudicating Authority admitted the application, appointing an Interim Resolution Professional. Akram Khan, Director of Poonam Drums & Containers Pvt. Ltd., appealed the decision, claiming the application was barred by limitation. The Bank argued that the Corporate Debtor acknowledged the debt, extending the limitation period under Section 18 of the Limitation Act, 1963. The Corporate Debtor's application to restructure

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## Issues and analysis

### Issue 1: Whether the application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 by the …

**Ratio:** The law of limitation dictates that when a debt is barred by time, the right to a remedy

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**Reasoning:** The court reasoned that allowing time-barred debts to be revived under the I&B Code

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**Interpretation:** The interpretation of Section 238A of the I&B Code, in conjunction with the

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**Application:** In this case, the default occurred on June 11, 2015, and the application was

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…; +1 more
- **Appellants:** Akram…
- **Respondents:** Poonam Drums &…; Bank of India…

## Timeline

- **2015-06-11 — Default on Debt…**: Poonam Drums & Containers Pvt.…
- **2015-09-29 — Account Classified as…**: Bank of India Limited classified the account of Poonam Drums & Containers Pvt. Ltd. as a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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