# In the matter of Highland Automobiles Private Limited

> NCLT judgment dated 2024-02-15. Citation: TCN-2024-NCLT-02587. Punjab National Bank filed an application under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 15 Feb 2024
- **Citation:** TCN-2024-NCLT-02587
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/highland-automobiles-private-limited-883cae20

## Summary

### Background

Punjab National Bank filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Highland Automobiles Private Limited, citing a default in repayment of a loan amounting to Rs. 33,64,46,005/-. The respondent, Highland Automobiles Private Limited, is a company incorporated on 25.09.1996. The applicant claimed that the respondent defaulted on 31.12.2008. The respondent contended that the application was filed after the expiry of the period of limitation and that they are solvent and ready to pay Rs. 12.50 Crore as part of a one-time settlement (OTS).

## Facts

Punjab National Bank (PNB) extended credit facilities to Highland Automobiles Private Limited. Highland Automobiles Private Limited defaulted on the repayment of a loan amounting to Rs. 33,64,46,005/-, with the date of default being 31.12.2008 when the account slipped into NPA. PNB filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Highland Automobiles Private Limited. The respondent argued that the application was filed after the expiry of the period of limitation, claiming a delay of more than 10 years. The respondent also claimed solvency and willingness to pay Rs. 12.50 Crore as part of a one-time settlement (OTS), with Rs. 50 Lakh already paid. The applicant

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## Issues and analysis

### Issue 1: Whether the present Application is …

**Ratio:** Section 18 of the Limitation Act states that acknowledgment of debt can extend the period

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**Reasoning:** The court examined the balance sheets of the respondent company for the financial years

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**Interpretation:** The court interpreted Section 18 of the Limitation Act in conjunction with the

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**Application:** The court applied the ratio to the facts of the case, noting that the balance

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## Parties

- **Judges:** Sh. Harnam Singh…; SH. L. N.…
- **Appellants:** Punjab National…
- **Respondents:** Highland Automobil…

## Timeline

- **1996-09-25 — Company Incor…**: Highland Automobiles Private…
- **2006-12-15 — Sanction…**: Date of sanction for CC…

## 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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