Acknowledgement of Liability Cannot be Used to Extend Limitation Period under the Insolvency Jurisdiction

In Bishal Jaiswal v. Asset Reconstruction Company[1], the National Company Law Appellate Tribunal, held that entries in the balance sheet / annual return of a corporate debtor cannot be treated as an acknowledgement under Section 18 of the Limitation Act, 1963. Insolvency jurisdiction being distinct from recovery mechanism, an acknowledgement cannot shift forward the date of default for the purposes of computing limitation for an application under Section 7 of the Insolvency and Bankruptcy Code.

 

[1] 2020 SCC OnLine NCLAT 681

Published In:Inter Alia - Quarterly Edition - December 2020 [ English Chinese
Date: December 31, 2020