In a significant judgement addressing the limitation framework under the Insolvency and Bankruptcy Code, 2016, the National Company Law Appellate Tribunal (NCLAT), New Delhi Bench, upheld the initiation of Corporate Insolvency Resolution Process (CIRP) against Extol Industries Ltd. under Section 7 of the IBC. The Ld. Tribunal clarified that when a financial liability is repeatedly carried forward in a corporate debtor’s balance sheets over successive financial years, without evidence of fresh borrowings, such entries constitute a valid acknowledgment of debt under Section 18 of the Limitation Act, 1963, even if the financial creditor is not expressly named in each instance.
The judgment arose from an appeal challenging the…
Insolvency Guardian
Insolvency Services & Bankruptcy Advice
