# In the matter of D. Srinivasa Rao, aged 73 years vs. Stressed Assets Stabilisation Fund & Ors.

> NCLAT judgment dated 2023-09-21. Citation: TCN-2023-NCLAT-00181. This case involves a challenge to an Impugned Order dated 24/03/2023 in CP(IB) No.…

- **Court:** NCLAT
- **Order date:** 21 Sept 2023
- **Citation:** TCN-2023-NCLAT-00181
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/d-srinivasa-rao-aged-73-years-vs-stressed-assets-stabilisation-fund-ors-afdc32f7

## Summary

### Background

This case involves a challenge to an Impugned Order dated 24/03/2023 in CP(IB) No. 574/7/HDB/2019, passed by the National Company Law Tribunal (NCLT), Hyderabad Bench, which admitted an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016. The appellant, D. Srinivasa Rao, argued that the application was barred by limitation, as the default occurred on 01/04/1997, and no acknowledgements were made before the expiry of the limitation period. The respondents, Stressed Assets Stabilisation Fund and PriyaranjaniFiber Limited, contended that the limitation period was extended due to various OTS proposals and the SICA moratorium.

## Facts

The Corporate Debtor defaulted on 01/04/1997. An OA 222/2000 was filed on 01/02/2000. The Corporate Debtor approached BIFR under Section 15 (1) of the SICA Act, 2002, on 13/09/2001. IDBI was appointed as the Operating Agency under Section 16(2) of the Act on 17/09/2002. The Corporate Debtor was declared a sick industry by BIFR under Section 3 (1) (o) of the Act on 27/12/2004. A Debt Recovery Certificate was issued by the DRT on 19/11/2009. The Corporate Debtor acknowledged making certain payments in a letter dated 16/02/2010. BIFR dismissed the Application of the Corporate Debtor on 22/11/2011. AIFR granted a stay of proceedings on 21/02/2012. The SICA Act was repealed on 01/12/2016. The Corporate Debtor did not move any Application within 180 days for continuation of

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## Issues and analysis

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

**Ratio:** Section 18 of the Limitation Act, 1963, states that an acknowledgment of present

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**Reasoning:** The court reasoned that the OTS proposals made by the Corporate Debtor Company

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**Interpretation:** The court interpreted Section 18 of the Limitation Act, 1963, to mean that an

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**Application:** The court applied the ratio to the facts of the case, finding that the OTS

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## Parties

- **Judges:** M. Venu…; Shreesha…; +1 more
- **Appellants:** D. Sriniva…
- **Respondents:** Priyaranjani…; Stressed Assets…

## Timeline

- **1997-04-01 — Default by Corporate…**: The Corporate Debtor…
- **2000-02-01 — OA Filed…**: OA 222/2000 wa…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61 — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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