The NCLT dismissed an application for initiating CIRP against the corporate debtor, holding that the claim was barred by limitation and that a pre-existing dispute existed due to pending arbitration proceedings involving the same claim.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE NATIONAL COMPANY LAW TRIBUNAL KOLKATA BENCH - I KOLKATA
C.P (IB) No. 987/KB/2020
An application under section 9 of the Insolvency and Bankruptcy Code, 2016 read with rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016.
In the matter of:
Sterling and Wilson Private Limited [CIN U31200MH1974PTC017538] having its registered office at 9th floor, Universal Magestic, P.L. Lokhande Marg, Chembur Mumbai – 400043.
...Operational Creditor
Versus
Bridge and Roof Company (India) Limited [ CIN U27310WB1920GOI003601 ], having its registered office at 2/1, Russel Street, 5th floor, Kolkata – 700071.
... Corporate Debtor
Date of Hearing: 20.05.2022 Date of pronouncing the order: 07.06.2022
Coram: Shri Rajasekhar V.K. : Member (Judicial) Shri Balraj Joshi : Member (Technical)
Appearances (through Video Conferencing)
For the Operational Creditor :Mr. Sanjeev Kumar Tyagi, Advocate. : Mr. Jaydeep Ghosh, Advocate. For the Corporate Debtor :Mr. DhirendraNath Sharma, Advocate. :Ms. Neelina Chatterjee, Advocate. :Mr. Suvadeep Chakraborty, Advocate .
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IN THE NATIONAL COMPANY LAW TRIBUNAL KOLKATA BENCH– I
C.P (IB) No. 987/KB/2020 Sterling and Wilson Private Limited v. Bridge and Roof Company (India) Limited
ORDER
Rajasekhar V.K., Member (Judicial)
Prologue
1. The Court convened via hybrid mode.
2. This is a Company Petition filed under section 9 of the Insolvency and Bankruptcy Code, 2016 (‘the Code’) read with Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 by Mr. Jaydeep Ghosh (Contracts and Legal), Sterling and Wilson Private Limited (‘Operational Creditor’) , duly authorised vide Board Resolution dated 30 July, 20201 for initiation of Corporate Insolvency Resolution Process (‘CIRP’) against Bridge and Roof Company (India) Limited (‘Corporate Debtor’) .
3. The present Petition was filed on 30 August, 2020 before this Adjudicating Authority. The total amount claimed in default is Rs.1,43,06,317/- (Rupees One Crore Forty Three Lakh Six thousand Three Hundred Seventeen [Principal - Rs.97,80,494/- and Interest – Rs.45,25,823/-] , inclusive of interest calculated @ 7.5% from 01 June, 2014 till 31 July, 2020.
4. In part II of the Petition the authorized share capital of the Corporate Debtor is Rs.60,00,00,000/- (Rupees Sixty Crore only) with subscribed share capital of Rs.5,49,87,155/- (Rupees Five Crore Forty Nine Lakh Eighty Seven Thousand One Hundred Fifty Five only).
5. Submissions by the Ld. Advocate appearing on behalf of the Operational Creditor .
1Annexure – P, page 280 of the Petition.
2Letter of Intent dated 10 July, 2007.
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IN THE NATIONAL COMPANY LAW TRIBUNAL KOLKATA BENCH– I
C.P (IB) No. 987/KB/2020
Sterling and Wilson Private Limited v. Bridge and Roof Company (India) Limited
(inRs.)
| Bill Value | 2,38,59,346/- |
|---|---|
| Cumulative Certified Value | 9,67,04,185/- |
| Escalation Cost and EMD | 1,66,601/- |
| Total | 9,68,70,706/- |
3Annexure B of the Petition.
4Annexure – F of the Petition.
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IN THE NATIONAL COMPANY LAW TRIBUNAL KOLKATA BENCH– I
C.P (IB) No. 987/KB/2020 Sterling and Wilson Private Limited v. Bridge and Roof Company (India) Limited
6. Submissions by the Ld. Advocate appearing on behalf of the Corporate Debtor .
7. Supplementary Affidavit filed by the Corporate Debtor duly notarized on 07 May, 2021
5Annexure – K of the Petition.
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IN THE NATIONAL COMPANY LAW TRIBUNAL KOLKATA BENCH– I
C.P (IB) No. 987/KB/2020 Sterling and Wilson Private Limited v. Bridge and Roof Company (India) Limited
Lakh Eighty Thousand Four Hundred Ninety Four only) in its statement of claim and the same amount has been claimed in this instant application under section 9 of the Code.
8. Supplementary Affidavit filed by the Corporate Debtor duly notarized on 04 January, 2022
9. Issue
10. We have heard the Ld. Counsel appearing on behalf of the Operational Creditor and the Ld. Counsel appearing on behalf of the Corporate Debtor and perused the record.
11. As envisaged under section 3(11) a ‘debt’ is a liability or obligation against a claim which is due from any person, whereas, a default occurs when there is a non-payment of such debt, partly, or wholly, by the debtor. To identify such default the most pivotal point that comes into picture is ‘date of default’ i.e., the date on which the debtor has failed to pay the debt.
12. The date of default is crucial to determine the date when the cause of action aroused7 because the right to sue under the Code occurs only when the default
6Annexure SA-2 and SA-3 of the Supplementary Affidavit filed by the Corporate Debtor duly notarized on 04 January, 2022
7B. Prashant Hegde v. State Bank of India &Anr., para 21[Company Appeal (AT) (Insolvency) No. 68 of 2019] decided on 14 October, 2020
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IN THE NATIONAL COMPANY LAW TRIBUNAL KOLKATA BENCH– I
C.P (IB) No. 987/KB/2020 Sterling and Wilson Private Limited v. Bridge and Roof Company (India) Limited
occurs. Further, it is a settled law now that limitation does not commence when the debt becomes due but only when a default.8 However, in this instant case there is no date of default given by the Operational Creditor.
13. Nevertheless, in this instant matter, even if the date of the final invoice i.e., 30 December, 2013 is to be taken as the date of default then also it is clear that as per Article 137 of the Limitation Act, three year would end in 2016. Further, on a toothcomb reading of the letter dated 25 September, 2017 by the Corporate Debtor nothing in the said letter would construe as an acknowledgement of debt.
14. With respect to the pre-existing dispute, it is pertinent to mention that an arbitration proceeding was already initiated by the Operational Creditor in the year 2020. Further, upon perusal of the record at page 20 of the Supplementary Affidavit filed by the Corporate Debtor duly notarized on 04 January, 2022, it would be apparent that one of the issues framed by the Ld. Sole Arbitrator is whether the Operational Creditor defaulted in performing its obligations under the contract or not?.
15. In light of the above facts and circumstances the C.P (IB) No. 987/KB/2020 is dismissed. However, the petitioner is at liberty to pursue its remedy under the law available, if any. Further, the observations made herein shall not in any way prejudice the arbitration proceedings pending between the parties.
16. File be consigned to record.
Digitally signed by Digitally signed by Rajasekhar V K DN: c=IN, o=Personal, title=0605, BALRAJ JOSHI pseudonym=490a45134c9adf68ed2365dbf55b7504ee43 Rajasekhar a6491c9e489ac8d67bacffde65cc, postalCode=600018, st=Tamil Nadu, Date: 2022.06.07 serialNumber=f05120aee9b7978ef74f18a3ac75eb59d05e036c92d850593b5c6edc8a8c7396, cn=Rajasekhar V K 17:17:31 +05'30' V K Date: 2022.06.07 16:59:36 +05'30' Adobe Acrobat Reader version: 2022.001.20117 Balraj Joshi Rajasekhar V.K. Member (Technical) Member (Judicial)
BALRAJ JOSHI
The order is pronounced on 07th day of June, 2022
Safura A., [LRA]
8B.K. Educational Services (P) Ltd. v. Parag Gupta & Associates [(2019) 11 SCC 633]
Page 6 of 6
2 issues framed by the court
Is the application barred by limitation?
Is there any pre-existing dispute between the parties?
Colour shows how this judgement treated each authority
B. Prashant Hegde v. State Bank of IndiaFollowed¶7
B. Prashant Hegde v. State Bank of India &Anr., para 21[Company Appeal (AT) (Insolvency) No. 68 of 2019] decided on 14 October, 2020
B.K. Educational Services (P) Ltd. v. Parag Gupta & AssociatesReferred¶8
B.K. Educational Services (P) Ltd. v. Parag Gupta & Associates [(2019) 11 SCC 633] · Who else cites this
3 provisions across 3 enactments
Sterling and Wilson Private Limited
Rajasekhar V.K.
Balraj Joshi
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
