# In the matter of T. Johnson Vs Phoenix ARC Pvt Ltd and Ors CA (AT) No.32 -2019

> NCLAT judgment dated 2019-05-07. Citation: TCN-2019-NCLAT-00575. The appeal was filed by T. Johnson, the majority shareholder and former Managing Director of…

- **Court:** NCLAT
- **Order date:** 7 May 2019
- **Citation:** TCN-2019-NCLAT-00575
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/t-johnson-vs-phoenix-arc-pvt-ltd-and-ors-ca-602fd58b

## Summary

### Background

The appeal was filed by T. Johnson, the majority shareholder and former Managing Director of St. John Freight System Limited (Corporate Debtor), challenging the legality and correctness of the order admitting the application filed by Phoenix ARC Pvt. Ltd. (Financial Creditor) under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Adjudicating Authority (National Company Law Tribunal), Division Bench Chennai, admitted the application, leading to a moratorium and the appointment of an Interim Resolution Professional. The appellant argued that the claim was time-barred and grossly exaggerated.

## Facts

T. Johnson, the majority shareholder and former Managing Director of St. John Freight System Limited (Corporate Debtor), filed an appeal against the admission of an application by Phoenix ARC Pvt. Ltd. (Financial Creditor) under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Corporate Debtor had secured a loan from State Bank of Travancore in 1999, amounting to Rs.59.35 Crores, which was renewed over time. The account was declared NPA on September 30, 2015. The bank assigned the account to Phoenix ARC Pvt. Ltd. on March 31, 2016. The total amount of default as of November 30, 2016, was Rs.60,92,44,653/-, which increased to Rs.73,08,54,170/- by March 15, 2018. The Corporate Debtor made a last payment on November 14, 2017. The Corporate Debtor also paid

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## Issues and analysis

### Issue 1: Whether the impugned order can be sustained when the claim in the application was allegedly …

**Ratio:** The principle of limitation dictates that legal claims must be brought within a specified

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**Reasoning:** The court reasoned that the last payment made by the Corporate Debtor on November 14,

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**Interpretation:** The court interpreted the relevant provisions of the Limitation Act and the

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

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## Parties

- **Judges:** Bansi Lal…; Balvinder…
- **Appellants:** T. Joh…
- **Respondents:** St. John Freight…; Phoenix ARC Pvt.…

## Timeline

- **1999-01-01 — Loan Sec…**: The Corporate Debtor secured a loan…
- **2015-09-30 — Account Decla…**: The Corporate Debtor's account was declared a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(7) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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