# In the matter of PEC Limited Vs. Tathagat Exports Pvt Ltd. Company Appeal (AT) (Insolvency) No. 341 of 2021

> NCLAT judgment dated 2022-04-18. Citation: TCN-2022-NCLAT-00533. This case involves an appeal against an order dated 10.11.2020 passed by the National Company…

- **Court:** NCLAT
- **Order date:** 18 Apr 2022
- **Citation:** TCN-2022-NCLAT-00533
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/pec-limited-vs-tathagat-exports-pvt-ltd-company-appeal-de57342f

## Summary

### Background

This case involves an appeal against an order dated 10.11.2020 passed by the National Company Law Tribunal (NCLT), New Delhi, which dismissed an application filed under Section 7 of the Insolvency & Bankruptcy Code, 2016, on the ground of limitation. The appellant, PEC Limited, claimed to be a financial creditor who had financed the corporate debtor, Tathagat Exports Pvt Ltd, for the procurement of iron ore. The NCLT dismissed the application, holding that it was barred by limitation. The appellant argued that the respondent had acknowledged its liability on several occasions between 2013 and 2017, and that the NCLT had failed to consider these acknowledgements and the relevant judgments of the Supreme Court.

## Facts

PEC Limited, the 'Financial Creditor', financed Tathagat Exports Pvt Ltd, the ‘Corporate Debtor', for the procurement of iron ore, not exceeding Rs. 10 crores. An ‘Associateship Agreement' was executed on 23.09.2008, validated until June 2012. An Addendum No.1 was executed on 30.06.2013. The Financial Creditor provided credit facilities to the tune of Rs. 16 crores. The validity of the Associateship Agreement was till 31.12.2014. The Respondent acknowledged debt of Rs.17,82,41,112/- in an email dated 18.06.2013, providing a repayment schedule with the last installment on 30.03.2014. The Respondent agreed to pay Rs.5-6 crores by the end of October 2014 and another Rs.5-6 crores by the end of March 2015 in an email dated 29.09.2014. A letter dated 18.11.2015 stated that

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority was justified in dismissing the Section 7 Application solely on …

**Ratio:** The ratio is based on the interpretation of Section 18 of the Limitation Act, 1963, which

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**Reasoning:** The NCLAT reasoned that the Adjudicating Authority failed to consider the various

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**Interpretation:** Section 18 of the Limitation Act, 1963, is interpreted to mean that any clear

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**Application:** The NCLAT applied the ratio to the facts of the case by noting that the letter

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## Parties

- **Judges:** Anant Bijay…; Ms Shreesha…
- **Appellants:** PEC LIM…
- **Respondents:** Tathagat Exports…
- **Advocates:** Rajeev Kuma…

## Timeline

- **2008-09-23 — Associateship…**: Associateship Agreement executed between PEC…
- **2012-06-01 — Associateship Agreement…**: Associateship Agreement…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 176 — Final dividend](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-176)

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