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Learned Counsel for the Appellant submits that although the date of default was mentioned as 10.01.2008 in the Application under Section 9 but there was District Court Mediation on 16.11.2015 wherein the Respondent accepted their liability and the post-dated cheques issued were also dishonored. Last cheque was dishonored on 31.12.2016. Hence, the Application filed was within time.
NCLAT holds that the submission of the Counsel for the Appellant is that there was Mediation Order of the Court on 16.11.2015 under which Mediation, post-dated cheques were given. The Mediation which was ordered on 16.11.2015 shall not give any extension of limitation to the Appellant. The purpose of Mediation and post-dated cheques are different and the fact that the cheques were dishonored may give any right to the Appellant to take appropriate proceeding but that shall not give extension of the limitation for the Application under Section 9 of the Code to make it within time.
The Applicant placed reliance on Section 25(3) of the Indian Contract Act and submits that since, there is a promise to pay the amount, therefore, the case of the Applicant comes under the purview of Section 25(3) of the Indian Contract Act and the provision of the Limitation Act is not applicable here. The Adjudicating Authority held that it is admitted position of law that the IBC is a complete code in itself and has overriding effect on provisions with IBC. Section 238A IBC, 2016, deals about the limitation and it says that the limitation Act is applicable. Since there is a specific provision under the IBC, which says that the limitation Act is applicable, we are unable to accept the submissions of the Applicant that the Section 238 of IBC is not applicable and Section 25(3) of Indian contract act is applicable.
