United Bank of India Vs Concast Morena Road Projects Pvt. Ltd. (NCLAT Delhi)
The National Company Law Appellate Tribunal (NCLAT), Delhi, dismissed an appeal filed by United Bank of India (now Punjab National Bank) against an order of the National Company Law Tribunal (NCLT), Kolkata, thereby upholding the rejection of a Section 7 insolvency application against Concast Morena Road Projects Pvt. Ltd. The NCLT had rejected the application on two grounds: failure to prove disbursement and that the application was barred by limitation.
The brief facts of the case are that the Appellant Bank claimed to have disbursed Rs.46.16 Crores in 2013, with the date of default committed by the Corporate Debtor being September 19, 2015. The Section 7 application under the Insolvency and Bankruptcy Code (IBC) was filed on December 10, 2019, which is beyond the three-year period mandated by the Limitation Act, 1963. Prior to the IBC filing, the Bank had initiated separate proceedings under Section 19 of the Recovery of Debt and Bankruptcy Act, 1993 (RDDB Act) by filing an Original Application (OA) in 2016, which remained pending.
Disbursement of Debt
Regarding the first ground for rejection, the NCLAT noted that the Corporate Debtor had not appeared before the NCLT to dispute the debt. The Tribunal found that the Bank had presented relevant documents, including the NeSL Certificate (National E-Governance Services Limited), which showed the debt was undisputed, and bank statements proving disbursement. Consequently, the NCLAT held that the Adjudicating Authority (NCLT) should not have returned a finding that the disbursement was not proved. The NCLAT, therefore, corrected this part of the NCLT’s finding in favor of the Bank.
