# In the matter of Indian Overseas Bank Vs. Patel Wood Products Ltd. CA(AT) (Ins) No. 54 of 2020

> NCLAT judgment dated 2020-01-13. Citation: TCN-2020-NCLAT-00544. The Appellant, Indian Overseas Bank, filed an application under Section 7 of the Insolvency…

- **Court:** NCLAT
- **Order date:** 13 Jan 2020
- **Citation:** TCN-2020-NCLAT-00544
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/indian-overseas-bank-vs-patel-wood-products-ltd-ca-a645aabe

## Summary

### Background

The Appellant, Indian Overseas Bank, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 against M/s Patel Woods Products Ltd. (Corporate Debtor). The Adjudicating Authority (National Company Law Tribunal), New Delhi Bench-V rejected the application on the ground that it was barred by limitation. The Appellant argued that the application was not barred by limitation as the Respondent had made payments in 2016.

## Facts

The Respondent (Corporate Debtor) had taken credit facility on 2004-04-27 which was enhanced/renewed from time to time by the Financial Creditor by letter dated 2005-08-08, 2006-09-11, 2007-01-22, 2008-02-05, 2008-08-06, 2008-10-22 onwards upto 2011-01-21. The Corporate Debtor accepted and acknowledged the liability towards the Appellant on various dates by executing the Revival Letters dated 2007-01-22, 2007-05-12, 2009-03-31, 2011-01-27 and 2014-01-25. The Appellant declared the subject amount as Non-Performing Asset (NPA) on 2012-02-27 w.e.f 2010-10-28. The default took place on 2010-10-28, and the subject amount was declared NPA on 2012-02-27 w.e.f. 2010-10-28. The Appellant had taken action under Section 13(2) of SARFAESI Act, 2002 and issued notice on 2012-12-03

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## Issues and analysis

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

**Ratio:** The principle of limitation dictates that legal actions must be initiated within a

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**Reasoning:** The Adjudicating Authority rejected the application under Section 7 on the ground that it

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**Interpretation:** Section 7 of the IBC allows a financial creditor to initiate corporate

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**Application:** The court applied the principle of limitation to the facts of the case,

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…; +1 more
- **Appellants:** Indian Overseas…
- **Respondents:** M/s Patel Woods…; Patel Woods…

## Timeline

- **2004-04-27 — Credit Facili…**: The Respondent (Corporate…
- **2010-10-28 — Date of D…**: The default having…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 19 — Personnel to extend co-operation to interim…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-19)

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