Omkara Assets Reconstruction Pvt. Ltd. Vs. Ritu Jankiprasad Shah - It is evident from these stipulations that the promise to pay was conditional and not having been accepted by the Petitioner with these conditions cannot constitute a clear and unconditional promise to pay. Hence, the said letters do not give rise fresh cause of action in terms of Section 25(3) of the Contract Act.

 NCLT Mumbai (2026.07.13) in  Omkara Assets Reconstruction Pvt. Ltd. Vs. Ritu Jankiprasad Shah [(2026) ibclaw.in 2738 NCLT, CP (IB) No. 1117/(MB)/2025] held that;

• There is a distinction between acknowledgment under Section 18 of the Limitation Act, 1963 and a promise within the meaning of Section 25 of the Contract Act. Both promise and acknowledgment in writing, signed by a party or its agent authorised in that behalf, have the effect of creating a fresh starting of limitation.

• The difference is that an acknowledgment under Section 18 of the Limitation Act has to be made within the period of limitation and need not be accompanied by any promise to pay. If an acknowledgment shows existence of jural relationship, it may extend limitation even though there may be a denial to pay.

• On the other hand, Section 25(3) is only attracted when there is an express promise to pay a debt that is time barred or any part thereof. Promise to pay can be inferred on scrutinising the document. Only the promise should be clear and unconditional”.

• It is evident from these stipulations that the promise to pay was conditional and not having been accepted by the Petitioner with these conditions cannot constitute a clear and unconditional promise to pay. Hence, the said letters do not give rise fresh cause of action in terms of Section 25(3) of the Contract Act.

Excerpts of the Order; 

1) The present Company Petition is filed u/s. 95 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as “IBC, 2016/Code”) r/w Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 by Omkara Assets Reconstruction Private Limited (“hereinafter referred to as Petitioner/Financial Creditor”) for initiating Insolvency Resolution Process against Ritu Jankiprasad Shah (“hereinafter referred to as Personal Guarantor/Respondent”) of the Corporate Debtor/ M/s Maharashtra Steel Pvt. Ltd. for having committed default in repayment of the Loan Amount Guaranteed by the Personal Guarantor even after invocation of Guarantee and Demand.

2) The brief facts leading to the filing of the present Company Petition are as follows:

i. State Bank of India (SBI) through its Sterling Branch, sanctioned and disbursed various Credit Facilities aggregating to Rs. 45 Crores in favour of the Borrower vide Sanctioned Letter dt. 19.11.2009. Having executed various documents by the Corporate Debtor to secure the above said Credit facilities, the Personal Guarantee was also executed by Janki Prasad Shah and Ritu Janki Shah and the Corporate Guarantee by Maharashtra Steel Rolling Mills Pvt. Ltd. and Maharashtra Steels Investments Pvt. Ltd.

ii. The Corporate Debtor failed to make payments towards various Financial Facilities availed by them and as a result account of the Corporate Debtor was classified as the Non-Performing-Asset (NPA) on 31.01.2014. SBI initiated action against the provision of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 and issued Notice under Section 13(2) of the said Act for the default Amount of Rs. 41,43,72,431/- on 02.07.2014.

iii. SBI took physical possession of the factory property at Wada on 22.11.2014 Corporate Debtor. Subsequently, vide Assignment Agreement dated 28.11.2019, · the account has been assigned to ASREC (India) Limited by SBI and further ASREC (India) Limited assigned the debt to Omkara Assets Reconstruction Pvt Ltd as on 17.03.2022. Vide SARFAESI Notice dt. 02.07.2014, to the Corporate Debtor, the Personal Guarantee vide the same Letter was also invoked and the demand was made to the Personal Guarantor to make the repayment of the Loan. In spite of that, no repayment was made.

iv. It is the case of the Applicant that the Corporate Debtor after availing the Loan has duly acknowledged the Debt from time to time and the debt was also acknowledged in the Financial Statement for the Year 2016-17. It is contended that no further Financial Statements were prepared and uploaded by the Corporate Debtor or else debt would have been further acknowledged by the Corporate Debtor. Meanwhile, the Company Petition No. 1187 of 2015 was filed before the Hon’ble High Court of Bombay and the Hon’ble High Court of Bombay admitted the said Petition and appointed Official Liquidator on 03.05.2018.

v. Due to pandemic Covid -19, the Limitation Period from 15.03.202 to 28.02.2022 was excluded and 90 days thereafter was available to file the Petition, till 31.05.2022. Thereafter, the Personal Guarantor Ms. Ritu Shah, addressed various Letters acknowledging debt due and payable to the Petitioner on 27.05.2024, 08.07.2024 and 16.01.2025. The Borrower through ex-Directors and Guarantor have acknowledged the Debt. The last Letter from the Personal Guarantor to the Corporate Debtor was received on 16.01.2025, though there is a break in chain of continuous acknowledgement of debt by the Corporate Debtor/Personal Guarantor. It is contended that the acknowledgement of liability even after expiry of original period of Limitation constitutes a fresh promise and gives rise to renewed cause of action, accordingly, any acknowledgement of debt made after the expiry of prescribed three years of Limitation rendering the claim maintainable from the date of such acknowledgement. Reliance is placed on the judgment in the case of Kotak Mahindra Bank Limited….vs….Kew Precision Parts Private Limited and Others (2022) 9 Supreme Court Cases 364, in Civil Appeal No. 2176 of 2020.

vi. It is submitted that the Hon’ble Supreme Court contemplates the Criteria required to be fulfilled i.e. a promise to pay whole or part of the Debtor in writing and signed by the respective party and such debt is of nature which Creditor will enforce but for the reasons of Limitation is unable to enforce the Payment. Thus, the promise to pay essentially must be treated as a contract and does not require an explicit acceptance of the same. Section 25(3) of the Contract attracted in the present case extending the Limitation.

vii. It is therefore submitted that the Petition is within Limitation and there is debt and default established by the Petitioner and therefore Personal Insolvency Resolution Process against the Personal Guarantor is required to be initiated.

3) The Respondent Personal Guarantor, pursuant to the Report under Section 99 of the Insolvency and Bankruptcy Code, 2016 filed by the Resolution Professional, appeared and filed their Reply and contended that the Petition is barred by Limitation and without going into the merits of the Case, the Petition is required to be dismissed. The account of the Corporate Debtor, M/s Maharashtra Steel Pvt. Ltd., was classified as Non-Performing-Asset (NPA) on 31.01.2014, thereafter, the Personal Guarantee was invoked vide Notice dt. 02.07.2014, consequently, the cause of action for filing the Petition against the Respondent herein crystalised at the latest on 02.07.2014. Accordingly, the Limitation for initiating proceedings against Respondent expires on 02.07.2017. Reliance of Financial Statements of the Corporate Debtor for the Financial Year 2016-17 is an attempt to contend that the debt stood acknowledged and consequently, the Limitation period stood extended.

4) Even if it is assumed to constitute the valid acknowledgement of debt by the Personal Guarantor, Petition would still remain barred by Limitation. The fresh period of Limitation would be commenced from the date of such acknowledgement i.e. 31.03.2017 and the period of 3 years would expire on 01.04.2020. Even if the exclusion of Limitation during Covid-19 Pandemic is taken and also 90 days period from 01.03.2022 is taken into consideration, the period of Limitation would still expire on 29.05.2022. The present Petition is filed admittedly on 15.10.2025, i.e. more than 3 years after the outer most period of Limitation available to the Petitioner, which is expired. It is therefore contended that the Petition is ex-facie barred by Limitation.

Submissions of Respondent/Personal Guarantor

5) It is submitted that the Petition is ex-facie barred by Limitation even after excluding Covid-19 Pandemic period and period of further 90 days as per the Judgment of the Hon’ble Supreme Court in the case of IL&FS Financial Services Ltd…vs…Adhunik Meghalaya Steels Pvt. Ltd., (2025) SCC OnLine SC 1567 is considered.

6) The reliance on Directors’ Report 03.09.2018 is wholly misconceived. Firstly, the document is neither signed nor stamped and its authenticity is therefore seriously disputed. Secondly, the said document does not pertain either to the Corporate Debtor or to the Respondent herein. It is a document of an altogether different entity and cannot constitute an acknowledgement on behalf of either the Corporate Debtor or the Respondent. Thirdly, the report does not contain any acknowledgement whatsoever of the alleged outstanding amounts claimed by the Petitioner. The Independent Auditors’ Reports for the Financial Years 2017-18 to 2020-21 are not the Reports of the Corporate Debtor or of the Respondent. They pertain to Maharashtra Steels Investment Pvt. Ltd., which is a separate Legal entity. The acknowledgement capable of extending Limitation must be clear, unambiguous and made by the person against whom the right is sought to be enforced. Documents of a third-party entity cannot operate as an acknowledgment on behalf of the Respondent.

7) The reliance on One Time Settlement (OTS) Proposals dt. 27.05.2024, 08.07.2024 and 16.01.2025 cannot revive a debt that had already become time-barred. It is a settled principle under Section 18 of the Limitation Act that an acknowledgement extends Limitation only if it is made before expiry of the prescribed period of Limitation. Once Limitation has expired, a subsequent acknowledgement cannot revive a barred claim. Reliance is placed on the Judgment of the Hon’ble Supreme Court in the case of Laxmi Pat Surana…vs…Union Bank of India (2021) 8 SCC 481 and also in the case of Small Industries Development Bank of India…vs…Sh. Krishnakant Bagree, (2025) ibclaw.in 2314 NCLT, wherein it was held that an acknowledgement made after expiry of Limitation does not revive a time-barred debt.

8) It is further submitted that OTS proposal relied upon by the Petitioner were merely proposals made in the course of settlement discussions and never culminated into a concluded contract between the Parties. The said OTS proposals were in the nature of conditional offers made by the Respondent with a view to explore an amicable resolution of disputes. The proposals were at all times subject to acceptance by the Petitioner. The Petitioner has neither pleaded nor produced any document evidencing its unequivocal acceptance of the said OTS proposals. In the absence of acceptance, the essential requirements for formation of a binding and enforceable contract are not satisfied. In other words, the said OTS proposals cannot be construed as forming any contract between the Parties which can be regarded as enforceable in law. Hence, the reliance of Section 25(3) of the Contract Act is also misconceived and erroneous. The OTS proposal was conditional upon it being accepted by the Applicant in full and final settlement, and there is no express promise to make any payment in any of the OTS Proposals without the acceptance of OTS proposals by the Applicant. Therefore, the Section 25(3) of the Contract Act is not applicable in the present case.

9) The only question falls for consideration in the present case is whether the Petition is filed within the Limitation and whether the OTS proposal by the Respondent amounts to acknowledgment of time barred debt and whether the Petition as filed on the basis of Notice of invocation dt. 02.07.2014 would survive, in view of Section 25(3) of the Contract Act.

Findings:

10) It is trite Law that provisions of Limitation Act are applicable to the proceedings under Section 238A of the Insolvency and Bankruptcy Code, 2016. Therefore, the Petition is required to be filed within a period of Three Years from the date of accrual of cause of action as contemplated under Section 137 of the Limitation Act. In the present case, undisputedly, the invocation of the Personal Guarantee was vide Notice dt. 02.07.2014, therefore, the cause of Action would first accrued on the expiry of the period stipulated under the Notice dt. 02.07.2014 (i.e. on 31.08.2014).

11) Therefore, the period of Limitation would expire on 31.08.2017. Admittedly, the present Petition is filed on 15.10.2025, therefore, the Petition would be barred by Limitation. However, it is the case of the Petitioner that there were acknowledgements of debt from time to time from the Corporate Debtor. The Corporate Debtor in its Financial Statements for the Year 2016-17 has acknowledged the Debt; therefore, the period of Limitation would stand extended till 31.03.2020. Now, since this period has fallen under the Covid-19 Pandemic period which taken from 15.03.2020 and ended on 28.02.2022, the Limitation after 15.03.2020 stands suspended and it would starts running after 28.02.2022 as held by the Hon’ble Supreme Court in the case of IL&FS Financial Services Ltd…vs…Adhunik Meghalaya Steels Pvt. Ltd., (2025) SCC OnLine SC 1567, further, period of 90 days would be available. Even excluding that period of 90 days, the Petition ought to have been filed on or before 29.05.2022 and the Petition is filed on 15.10.2025. Therefore, even on basis of acknowledgements of debt by the Corporate Debtor in its Financial Statement for the year 2016-17, the Petition would still fail on count of Limitation.

12) The submission of the Ld. Counsel for the Petitioner that there would have been further acknowledgment, had the Corporate Debtor filed its Financial Statements for the subsequent periods after 2017 does not holds any merit as they are admittedly not filed, which does not amount to acknowledgment of any debt thereafter.

13) As regards reliance on audited Financial Statements of Maharashtra Steels Investment Private Limited, the Corporate Guarantor to the facilities guaranteed by the Respondent, is concerned, it is noted that the said Financial Statements has neither acknowledged any liability towards the Petitioner Creditor in any of the year(s) in the said Financial Statements, nor any liability towards Petitioner Creditor is disclosed even as Contingent Liability therein. Accordingly, it can not be said that the debt, in question, has been acknowledged by such corporate guarantor binding the respondent herein in terms of clause 14 of the Guarantee Agreement, which provides that “14. If the Guarantors be more than one Individual or entity, each one or any of them is hereby authorised by the others of them to admit and acknowledge their liability to the Bank by any payment Into the account or by way of writing or in any manner otherwise and any such acknowledgement of liability or part payment by any or more of them shall in addition to this / their personal capacity be deemed to have been made on behalf of each of them for the purposes of Sections 18 and 19 of the Limitation Act, 1963.” Accordingly, we do not find merit in the reliance of these financial statements of corporate guarantor namely Maharashtra Steels Investment Private Limited. Nonetheless, the submission of the Ld. Counsel for the Respondent that the Financial Statements are prepared by some Third-Party and Independent Auditor and therefore it has no evidentiary value so far as the Corporate Debtor is concerned also does not have any substantial force and merits in view of clause 14 of Guarantee Agreement binding each of guarantor by the acknowledgement of other guarantor.

14) Only question that remains now is whether Section 25(3) of the Contract Act comes to the rescue of the Petitioner. It is the case of the Petitioner that the Personal Guarantor vide its Letter dt. 27.05.2024, which was received by the Petitioner on 16.01.2025, submitted an One Time Settlement proposal (OTS) offering to pay amounts due from the Principal borrower and such letter(s) are signed by the Respondent as “ex-director and guarantor” of Principal Borrower. Accordingly, it is submitted by the Petitioner that though there is break in chain of continuous acknowledgement of Debt by the Personal Guarantor/Corporate Debtor, the acknowledgement of liability even after expiry of Original Period of Limitation constitutes fresh promise and give rise to renewed cause of action. As against this contention, it is submitted by the Respondent that the OTS proposal was just a proposal and it was not accepted and therefore, it cannot be considered to be a valid contract between the Parties and it cannot give any extension of Limitation.

15) It is further submitted that it is settled principal under Section 18 of the Limitation Act that an acknowledgement extends limitation only if it is made before expiry of the prescribed period of Limitation. Once Limitation has expired, a subsequent acknowledgement cannot revive a barred claim. Reliance is placed on the Judgment of the Hon’ble Supreme Court in the case of Laxmi Pat Surana…vs…Union Bank of India (2021) 8 SCC 481 and also in the case of Small Industries Development Bank of India…vs…Sh. Krishnakant Bagree, (2025) ibclaw.in 2314 NCLT. It is therefore, submitted that the Petition is thus, barred by Limitation and the acknowledgment after the expiry of period of limitation would not revive the cause of action.

16) The Ld. Counsel for the Petitioner has placed reliance on the judgment in the case of Kotak Mahindra Bank Limited vs Kew Precision Parts Private Limited and Others (2022) 9 Supreme Court Cases 364, in Civil Appeal No. 2176 of 2020, wherein the Hon’ble Supreme Court held as under:

• “31. Under Section 25(3), a debtor can enter into an agreement in writing, to pay the whole or part of a debt, which the creditor might have enforced, but for the limitation of a suit in law. A written promise to pay the barred debt is a valid contract. Such a promise constitutes novation and can form the basis of a suit independent of the original debt, for it is well settled that the debt is not extinguished, the remedy gets barred by passage of time as held by this Court in Bombay Dyeing and Manufacturing Company Limited vs. State of Bombay1.

• 32. Section 25(3) applies only where the debt is one which would be enforceable against the defendants, but for the law of limitation. Where a debt is not binding on the defendant for other reasons, and consequentially not enforceable against him, there is no question of applicability of Section 25(3).

• 33. There is a distinction between acknowledgment under Section 18 of the Limitation Act, 1963 and a promise within the meaning of Section 25 of the Contract Act. Both promise and acknowledgment in writing, signed by a party or its agent authorised in that behalf, have the effect of creating a fresh starting of limitation. The difference is that an acknowledgment under Section 18 of the Limitation Act has to be made within the period of limitation and need not be accompanied by any promise to pay. If an acknowledgment shows existence of jural relationship, it may extend limitation even though there may be a denial to pay. On the other hand, Section 25(3) is only attracted when there is an express promise to pay a debt that is time barred or any part thereof. Promise to pay can be inferred on scrutinising the document. Only the promise should be clear and unconditional”.

17) The above Authority clearly lays down the difference between the provisions of Section 18 of the Limitation Act and Section 25(3) of the Contract Act. It is a trite Law that any acknowledgement of debt within the period of Limitation would attract Section 18 of the Limitation Act and the Limitation would stand extended for the further period as contemplated under the Law. However, Section 25 deals with the acknowledgement of time barred debt.

18) The Hon’ble Supreme Court in the above said Authorities has held that there is distinction between acknowledgement of Section 18 of the Limitation Act and a promise within the meaning of Section 25 of the Contract Act. Both Promise and acknowledgement in writing signed by a party or its agent authorised in their behalf, have the effect of creating fresh starting of Limitation. The difference is that the acknowledgment under Section 18 of the Limitation Act has to be made within the period of limitation and need not be accompanied by a promise to pay, and if an acknowledgement shows existence of jural relationship, it may extend limitation even though there may be a denial to pay. On the other hand, Section 25(3) is only attracted when there is an express promise to pay a debt that is time barred or any part thereof. Promise to pay can be inferred on scrutinising the document. Only the promise should be clear and unconditional. In the present case, the acknowledgement at exhibit “H” would show that there is a proposal sent by the Personal Guarantor for One-Time-Settlement of the debt, wherein willingness to Pay an amount towards the full and final settlement of the outstanding debt was made. Therefore, there is a promise to pay which is unequivocally made in writing with the signature of the Personal Guarantor; and this Letter is not disputed. However, such promise has to be clear and unconditional.

19) Therefore, what is required under Section 25(3) is only a promise to pay time barred debt in clear terms. Acceptance of the promise is not contemplated and therefore, acknowledgement of time barred debt would attract Section 25(3) of the Contract Act and it would give a fresh cause of action for initiating the recovery.

20) It is noted that the said letter(s) contemplates that, On payment of upfront amount, we shall be granted approval for sale of Wada land – 6, acres, and any offer received from party will be accepted to conclude the sale”; “payment arranged from our sources and sale proceeds of the secured assets appropriated to you should be considered towards the payment of the settlement amount”; and “on the acceptance of the above proposal, all the recovery proceedings/actions taken by you shall be kept in abeyance”. It is evident from these stipulations that the promise to pay was conditional and not having been accepted by the Petitioner with these conditions cannot constitute a clear and unconditional promise to pay. Hence, the said letters do not give rise fresh cause of action in terms of Section 25(3) of the Contract Act. Needless to say, as against the provisions of Section 18 of the Limitation Act, the acknowledgement of time barred debt would gives fresh cause of action for which the Petitioner would have a fresh remedy available.

21) Therefore, since, the invocation of Guarantee and the demand thereunder was made sometimes in the Year, 2014 and admittedly, the Petition was not filed within the period of 3 years. The Original Cause of Action would stand extinguished after the period of Limitation. Hence, the present Petition filed on the Original cause of action on the contention that the acknowledgement of time barred debt subsequently by the Personal Guarantor would continue the same cause of action does not hold merits, therefore, the Petition would not survive.

22) In view of the above, we are of the Considered view that the present Petition as filed is barred by Limitation.

23) Accordingly, the Company Petition bearing CP (IB) No. 1117 of 2025, is disposed of as dismissed.

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Dr. Dipankar Chakraborty Vs. Allahabad Bank & Ors. - Section 14 of the Limitation Act, 1963, permits exclusion of time for proceeding bona fide in a Court without jurisdiction. Three conditions have to co-exist for Section 14 to be attracted and applied. Firstly, the plaintiff must satisfy that, he was prosecuting another civil proceeding with due diligence. Secondly, the earlier and the latter proceeding must be founded on the same cause of action. Thirdly, the Court in which the former proceeding was prosecuted suffers from defect of jurisdiction or other cause of the nature rendering it incapable of entertaining such proceeding.

 HC Calcutta (2017.07.07) in Dr. Dipankar Chakraborty Vs. Allahabad Bank & Ors. [W.P. No. 16511 (W) of 2016 ] held that;

• Section 36 of the Act of 2002, bars a secured creditor from taking all or any measure under Section 13(4), unless the claim of such secured creditor is within the period of limitation prescribed under the Limitation Act, 1963.

• The provisions of the Limitation Act, 1963 are, therefore, applicable when a secured creditor seeks to initiate a proceeding under the Act of 2002. At least at the time of taking a measure under Section 13(4), the Limitation Act, 1963 would come into operation, that is to say that, the secured creditor is permitted by the Act of 2002 to take a measure under Section 13(4) only and only if, the measure sought to be taken is within the period of limitation as prescribed under the Limitation Act, 1963.

• We agree with the contention of the appellant that the remedy provided under SARFAESI Act is simply a new means of enforcing a preexisting right, i.e., one that existed before the SARFAESI Act came into existence. That remedy is the right to sell a mortgage property and recover the sum which it secures from the sale proceeds. In the present case, since right to file a suit or proceedings stood extinguished, the SARFAESI Act would not revive this extinguished claim.

• Varun Steels (supra) has held that, the question of limitation being a mixed question of fact and law, the same cannot be gone into in a proceeding under Article 226 of the Constitution of India more particularly in view of the facts scenario obtaining in that case. There was a proceeding pending before the Debts Recovery Tribunal which according to the Court was better-equipped to decide such question of limitation.

• Sand Plast (India) Ltd. (supra) has relied upon a Supreme Court decision reported at 2008 Volume 1 Supreme Court Cases page 125 (Transcore v. Union of India & Anr.). It has held that, the same was not a conclusive opinion on the point and that a final decision on such issue was to be taken by the Debts Recovery Tribunal.

• The initiation of a proceeding under Section 13(2) of the Act of 2002 is an original proceeding and Section 5 of the Limitation Act, 1963 would have no manner of application at the point of initiation of the proceedings. It applies to an appeal under Section 17 of the Act of 2002.

• Section 14 of the Limitation Act, 1963, permits exclusion of time for proceeding bona fide in a Court without jurisdiction. Three conditions have to co-exist for Section 14 to be attracted and applied. Firstly, the plaintiff must satisfy that, he was prosecuting another civil proceeding with due diligence. Secondly, the earlier and the latter proceeding must be founded on the same cause of action. Thirdly, the Court in which the former proceeding was prosecuted suffers from defect of jurisdiction or other cause of the nature rendering it incapable of entertaining such proceeding.

• Section 4, Section 14 and Section 15 of the Limitation Act, 1963, does not assist a bank to initiate a proceeding under Act of 2002 which is otherwise barred by limitation on the date of its initiation premised upon of a pendency of a proceeding under Section 19 of the RDB Act, 1993 before the DRT.

• The Act of 2002 gives an independent right to a secured creditor to proceed against its financial assets and in respect of which such asset the secured creditor has security interest. The right to proceed, however, is subject to the adherence to the provisions of limitation as enshrined in the Limitation Act, 1963. The provisions of the Limitation Act, 1963 are, therefore, attracted to a proceeding initiated under the Act of 2002.

Excerpts of the Order; 

The petitioner has assailed the invocation of the provisions of  Securitization    and    Reconstruction    of   Financial   Assets   and Enforcement of Security Interest Act, 2002 (SARFAESI Act) by the bank on the ground that at the time of invocation, the same was barred by the laws of limitation.

The petitioner appearing in person has submitted that, the petitioner had enjoyed credit facilities from the bank. The bank not having acted in terms of its obligations, the petitioner was obliged to file a suit for damages being Money Suit No. 120 of 2000 before the learned City Civil Court at Calcutta against the bank. The bank had filed a proceeding under Section 19 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 against the petitioner being O.A. No. 137 of 2001 before the Debts Recovery Tribunal-1, Kolkata. The Civil Suit was also transferred to the Debts Recovery Tribunal-1. Both the proceedings are pending adjudication. The bank has, thereafter, issued the impugned notice dated March 3, 2016 purportedly under the Act of 2002. The petitioner had replied thereto by a writing dated March 21, 2016. The bank is now proceeding wrongfully under the Act of 2002 as on the date of issuance of the notice under Section 13(2) of the Act of 2002, the  claim of the bank was barred by the laws of limitation. He has referred to Section 36 of the Act of 2002 and submitted that, the claim of the bank has to be within the period of limitation at the time of initiation of the proceedings under the Act of 2002. He has submitted that, the mortgage of the immovable property concerned was created in 1995. In terms of the provisions of the Limitation Act, 1963, a suit for mortgage could have been instituted by 2007. The petitioner had paid the last installment in respect of the loan account in October 1995. Taking such fact into consideration the notice under the provisions of the Act of 2002 cannot be said to be within the period of limitation. In support of his contention that, when a claim of a bank or a financial institution is barred by the laws of limitation, such bank or financial institution is not entitled to invoke the provisions of the Act of 2002, the petitioner has relied upon 2014 Volume 135 All India Cases page 550 (Abhay Ram v. Mahant Rambali Das & Anr.), All India Reporter 2014 Supreme Court page 1612 (Brijesh Kumar v. State of Haryana & Ors.), 2005 Volume 7 Supreme Court Cases page 510 (Popat and Kotecha Property v. State Bank of India Staff Association) and 2010 Volume 5 Supreme Court Cases page 459 (Oriental Aroma    Chemical     Industries    Ltd.   v.   Gujarat   Industrial Development Corporation & Anr.). 

Referring to 2012 Volume 129 DRJ page 654 (Somnath Manocha v. Punjab and Sindh Bank & Anr.), the petitioner has submitted that, since the proceedings under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 are not a proceeding for mortgage, therefore, a period of 12 years is not available to the bank for the purpose of invoking the provisions of the Act of 2002. In any event, a period in excess of 12 years has elapsed prior to the invocation of Section 13(2) of the Act of 2002, in the facts of the present case. Consequently, theAuthorized Officer of the bank has exercised a jurisdiction not vested upon it by law. The proceedings initiated by the Authorized Officer of the bank under the Act of 2002 commencing from the issuance of the notice under Section 13(2) of the Act of 2002 should be quashed.

Learned Advocate for the bank has submitted that, the claim of the bank is within the period of limitation. He has submitted that, the period of limitation had stopped on the date when the bank had filed the proceedings under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 in 2001. The proceeding before the Debts Recovery Tribunal-1, Kolkata is within the period of limitation. Such proceedings are yet to be disposed of. Consequently, the bank is entitled to invoke the provisions of the Act of 2002 since the limitation had stopped in 2001.

Referring to 2012 Volume 129 DRJ page 654 (Somnath Manocha v. Punjab and Sindh Bank & Anr.), learned Advocate for the bank has submitted that, the period of limitation had stopped on the date of filing of the proceedings under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. The Authorized Officer of the bank, therefore, did not act irregularly or without jurisdiction in invoking the provisions of the Act of 2002. He has referred to the word "claim" as used in Section 36 of the Act of 2002 and has submitted that, such word is not defined under the Act of 2002. He refers to the word "financial asset" used in Section 36 of the Act of 2002. He has submitted that, the word 'financial asset" is defined in Section 2(l) of the Act of 2002. He has referred to the definition of the word "debt" as defined in Section 2(ha) of the Act of 2002 and the definition of the word 'debt" used in Section 2(g) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. He has submitted that, the proceedings under Section 19 of the Act of 1993 are yet to attain finality. Once such proceedings culminate into a certificate, the bank would have a period of 12 years to execute such certificate. That being the position, and more particularly in view of the fact that the Section 19 proceedings are yet to be disposed of, it cannot be said that, the bank has acted beyond jurisdiction or beyond the period of limitation for invoking the provisions of the Act of 2002. He has emphasized on the fact that, any other interpretation of Section 36 of the Act of 2002, in the facts of the present case, would lead to an irreconcilable and anomalous situation in that, a bank after obtaining a certificate under Section 19 of the Act of 1993 would be in a position to invoke the provision of the Act of 2002 but at the same time would not be entitled to invoke the provisions of the Act of 2002 in the interregnum when there does not exist a  certificate under Section 19 of the Act of 2002. The provisions of Section 36 of the Act of 2002 read with the definition of "financial asset" and "debt" as given in the respective Acts should be taken into consideration for the purpose of returning a finding that, the bank has invoked the provisions of the Act of 2002 within the period of limitation. He has submitted that, no word used in the statute should be considered to be superfluous. In respect of such contention he has relied upon 2002 Volume 4 Supreme Court Cased page 97 (Grasim Industry Limited v. Collector of

Customs, Bombay).

Relying upon All India Reporter 2011 Delhi page 196 (Sand Plast (India) Ltd. v. Punjab National Bank & Anr.) and Punjab Law Reports 2008 (149) Punjab and Haryana page 550 (Varun Steels v. Canara Bank & Anr.) he has submitted that, the proceedings initiated by the bank under the Act of 2002 are within the period of limitation.

The following issues have arisen for consideration in the instant proceedings:-

• (i)        Whether the period of limitation stops on the filing of a proceeding under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 for a bank or a financial institution to invoke the provisions of the Act of 2002 in respect of the same claims as in the Section 19 proceedings?

• (ii)       To what reliefs if any, are the parties entitled to? 

The petitioner as a medical professional had started a medical diagnostic center and had obtained a loan from Canara bank. The petitioner has claimed to have repaid such loan. The petitioner had, thereafter, approached Punjab National Bank for credit facility. According to the petitioner, the bank had sanctioned a credit facility. Subsequent to the sanction, the bank did not discharge its obligations. Rather, the bank had caused loss and damages to the petitioner due to the various unlawful activities. The petitioner had filed a civil suit being Money Suit No. 120 of 2000 against the bank before the learned City Civil Court for recovery of the loss and damages suffered by him. The bank had filed a proceeding under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 being O.A. No. 137 of 2001 before the Debts Recovery Tribunal, Kolkata. The Civil Suit was transferred to the Debts Recovery Tribunal for adjudication. Both the proceedings are pending.

The parties had taken various steps against each other in several other proceedings. The bank had issued a notice under Section 13(2) of the Act of 2002 on February 4, 2011. The petitioner had moved the High Court for quashing such notice. Such proceeding was dismissed on the ground that, the petitioner had a statutory alternative efficacious remedy. On April 13, 2011 the bank had invoked the provisions of Section 13(4) of the Act of 2002. A possession notice in respect of the residential house of the petitioner was published on April 27, 2011 and a sale notice was published on May 10, 2011. The petitioner had applied under

Section 17 of the Act of 2002 before the Debts Recovery Tribunal. The bank had then taken a stand that, it would withdraw the notices under Sections 13(2) and 13(4) of the Act of 2002. The bank had done so by publication of a notice in a newspaper on June 6, 2011. The bank had, thereafter, issued another notice dated July 5, 2011 under Section 13(2) of the Act of 2002. This notice was issued to the guarantor. A reply under Section 13(3A) of the Act of 2002 was sent on July 29, 2011. The bank had dealt with the same by their letter dated August 9, 2011.

In such fact scenario the question is whether the invocation of the provisions of the Act of 2002 on July 5, 2011 through the issuance of the notice under Section 13(2) is within the period of limitation as envisaged under Section 36 of the Act of 2002 or not.

The provisions of the Sections 2(ha), 2(l) and 36 Act of 2002 and Section 2(g) of the Act of 1993 that have been placed for consideration are follows:-           

• "2(ha). "debt" shall have the meaning assigned to it in clause (g) of section 2 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 and includes -

• (i) unpaid portion of the purchase price of any tangible asset given on hire or financial lease or conditional sale or under any other contract;

• (ii) any right, title or interest on any intangible asset or licence or assignment of such intangible asset, which secures the obligation to pay any unpaid portion of the purchase price of such intangible asset or an obligation incurred or credit otherwise extended to enable any borrower to acquire the intangible asset or obtain licence of such asset; "

• "2(l). "financial asset" means debt or receivables and includes-

• (i) a claim to any debt or receivables or part thereof, whether secured or unsecured; or

• (ii) any debt or receivables secured by, mortgage of, or charge on, immovable property; or

• (iii) a mortgage, charge, hypothecation or pledge of movable property; or

• (iv) any right or interest in the security, whether full or part underlying such debt or receivables; or

• (v) any beneficial interest in property, whether movable or immovable, or in such debt, receivables, whether such interest is existing, future, accruing, conditional or contingent; or

• (va) any beneficial right, title or interest in any tangible asset given on hire or financial lease or conditional sale or under any other contract which secures the obligation to pay any unpaid portion of the purchase price of such asset or an obligation incurred or credit otherwise provided to enable the borrower to acquire such tangible asset; or

• (vb) any right, title or interest in any intangible asset or licence or assignment of such intangible asset, which secures the obligation to pay any unpaid portion of the purchase price of such intangible asset or an obligation incurred or credit otherwise extended to enable the borrower to acquire such intangible asset or obtain licence           of the intangible asset; or

• (vi) any financial assistance."

• "36. Limitation.- No secured creditor shall be entitled to take all or any of the measures under sub- section (4) of section 13, unless his claim in respect of the financial asset is made within the period of limitation prescribed under the Limitation Act, 1963 (36 of 1963)."

• 2(g). "debt" means any liability (inclusive of interest) which is claimed as due from any person by a bank of a  financial institution or by a consortium of banks or          financial institutions during the course of any business activity undertaken by the bank or the financial institution or the consortium under any law for the time being in           force, in cash or otherwise, whether secured or unsecured, or assigned, or whether payable under a decree or order of any civil court or any arbitration award or otherwise or under a mortgage and subsisting on, and legally recoverable on, the date of the application."

Sections 4, 14 and 15 of the Limitation Act, 1963 are also relevant. They are as follows:-

• "4. Expiry of prescribed period when court is closed.--Where the prescribed period for any suit, appeal or application expires on a day when the Court is closed, the suit, appeal or application may be instituted, preferred or made on the date when the Court re-opens.

•  Explanation.-- A Court shall be deemed to be  closed on any day within the meaning of this section if during any part of its normal working hours it remains closed on that day."

• "14. Exclusion of time of proceeding bona fide in Court without jurisdiction. --

• (1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a Court of first instance or of appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a Court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.

• (2)In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a Court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a Court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.

• (3) Notwithstanding anything contained in rule 2 of Order XXIII of the Code of Civil Procedure, 1908, the provisions of sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the Court under rule 1 of that Order where such permission is granted on the ground that the first suit must fail by reason of a defect in the jurisdiction of the Court or other cause of a like nature.

• Explanation.-- For the purposes of this section,--

• (a) in excluding the time during which a former civil proceeding was pending, the day on which that  proceeding was instituted and the day on which it ended shall both be counted;

• (b)a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding;

• (c)misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction."

• "15. Exclusion of time in certain other cases.--

• (1) In computing the period of limitation of any suit or application for the execution of a decree, the institution or execution of which has been stayed by injunction or order, the time of the continuance of the injunction or order, the day on which it was issued or made, and the day on which it was withdrawn, shall be excluded.

• (2) In computing the period of limitation for any suit of which notice has been given, or for which the previous consent or sanction of the Government or any other authority is required, in accordance with the requirements of any law for the time being in force, the period of such notice or, as the case may be, the time required for obtaining such consent or sanction shall be excluded. 

• Explanation.-- In excluding the time required for obtaining the consent or sanction of the Government or any other authority, the date on which the application was made for obtaining the consent or sanction and the date of receipt of the order of the Government or other authority shall both be counted.

• (3)In computing the period of limitation for any suit or application for execution of a decree by any receiver or interim receiver appointed in proceedings for the adjudication of a person as an insolvent or by any liquidator or provisional liquidator appointed in proceedings for the winding up of a company, the period beginning with the date of institution of such proceeding and ending with the expiry of three                months from the date of appointment of such receiver or liquidator, as the case may be, shall be excluded.

• (4)In computing the period of limitation for a suit for possession by a purchaser at a sale in execution of a decree, the time during which a proceeding to set aside the sale has been prosecuted shall be excluded.

• (5)In computing the period of limitation for any suit the time during which the defendant has been  absent from India and from the territories outside India under the administration of the Central Government, shall be excluded."

Section 36 of the Act of 2002, bars a secured creditor from taking all or any measure under Section 13(4), unless the claim of such secured creditor is within the period of limitation prescribed under the Limitation Act, 1963. The provisions of the Limitation Act, 1963 are, therefore, applicable when a secured creditor seeks to initiate a proceeding under the Act of 2002. At least at the time of taking a measure under Section 13(4), the Limitation Act, 1963 would come into operation, that is to say that, the secured creditor is permitted by the Act of 2002 to take a measure under Section 13(4) only and only if, the measure sought to be taken is within the period of limitation as prescribed under the Limitation Act, 1963. The secured creditor is required to make his claim in respect of the financial asset within the period of limitation prescribed under the Limitation Act, 1963. Would lodging a proceeding under Section 19 of the Act of 1993 be construed to be making by a claim in respect of the financial asset within the period of limitation prescribed under Limitation Act, 1963 is another question which arises for consideration.

In the facts of the present case, the petitioner has not contended that, the claim made by the secured creditor before the Debts Recovery Tribunal under Section 19 of the Act of 1993 is barred by the laws of limitation. In any event, the issue of limitation of the proceedings under Act of 1993 is an issue which is to be decided by the Debts Recovery Tribunal before which such proceedings are pending. A Writ Court in a collateral proceeding is not required to answer such an issue. Such an issue also does not fall for consideration in the present case. Rather the issue as to whether the lodging of the proceedings under Section 19 of the Act of 1993 continues the period of limitation, or in other words, stops the running of the period of limitation on and from the date of lodging of such proceedings has arisen for consideration in the present case.

The issue of limitation in the context of Section 36 of the Act of 2002 was looked at and considered in Somnath Manocha (supra). The Division Bench of the Delhi High Court in Somnath Manocha (supra) has held that,

• "15. The requirement of Section 36 is that the claim in respect of "financial asset" is made within the period of limitation prescribed under the Limitation Act. Claim in respect of "financial asset" is defined as defined by Section 29(1) of the SARFAESI Act means debt or receivables and includes a claim to any debt or receivables or part thereof, whether secured or unsecured, and also any beneficial interest in property, whether movable or immovable, or in such debt, receivables, whether such interest is existing, future, accruing, conditional or contingent. Section 2(1)(t) which defines "property" is also relevant. This definition reads as under;

•  "(t) "property" means--

• (i) immovable property;

• (ii) movable property;

• (iii) any debt or any right to receive payment of money, whether secured or unsecured;

• (iii) receivables, whether existing or future;

• (iv) intangible assets, being know-how,patent, copyright, trade mark, licence, franchise or any other business or commercial right of similar nature;"

• 16. So far so good. The question is as to whether in the facts of this case, the claim had become time barred. The property in question is mortgaged with the bank. However, the bank did not file Suit for recovery under Order XXXIV of the CPC. Instead, in para 17 of the plaint, specific averment was made that it was not claiming any relief against the mortgaged immovable property in the said suit and right was reserved to proceed against the said mortgaged property as provided under provisions of Order XXXIV Rule 14 of the CPC. 

• 17. It could not be disputed that under ordinary law, the respondent bank has lost the remedy of enforcing the aforesaid security by way of mortgage as limitation of 12 years as provided in Article 62 of the Schedule to the Limitation Act, 1963 has expired. The bank chose to file only a suit for recovery of money and in spite of averment made in Para 17 of the plaint, it did not file any suit under Order XXXIV of the CPC. No doubt, in terms of order XXXIV Rule 14, the bank was entitled to bring the mortgaged property to sale by instituting a suit for sale in enforcement of the mortgage whereafter obtaining a decree for payment of money, in satisfaction of the claim under mortgage. However, such a suit could be filed within the period of limitation prescribed under Article 62 in the Schedule to the Limitation Act. Thus, under the ordinary law, the bank is precluded from filing a mortgage suit in respect of the aforesaid property.

• 18. Thus, on the date of notice issued under Section 13(2) of SARFAESI Act, there was no such existing or subsisting right qua mortgage. We agree with the contention of the appellant that the remedy provided under SARFAESI Act is simply a new means of enforcing a preexisting right, i.e., one that existed before the SARFAESI Act came into existence. That remedy is the right to sell a mortgage property and recover the sum which it secures from the sale proceeds. In the present case, since right to file a suit or proceedings stood extinguished, the SARFAESI Act would not revive this extinguished claim.

• 19. Position would have been different if the bank had filed mortgage suit and such a suit was pending. In Ivee Injectaa Ltd. (supra), mortgage suit has already been filed and therefore, claim for enforcing mortgage rights was subsisting as it was pending adjudication. If the period of 12 years had not expired under Article 62 in the Schedule to the Limitation Act and there was still time to file the proceedings of mortgage suit, even that would have saved the right of the Bank to enforce the provision of SARFAESI. But even that action has become time barred. In the facts of this case, we hold that the claim is barred under Section 36 of SARFAESI Act and therefore, it was not open to the bank to proceed under this Act. We, thus, allow this appeal and quash the impugned notice under Section 13(2) and 13(4) of SARFAESI Act issued by the bank." 

Varun Steels (supra) has held that, the question of limitation being a mixed question of fact and law, the same cannot be gone into in a proceeding under Article 226 of the Constitution of India more particularly in view of the facts scenario obtaining in that case. There was a proceeding pending before the Debts Recovery Tribunal which according to the Court was better-equipped to decide such question of limitation.

Sand Plast (India) Ltd. (supra) has considered the point of limitation on a prima facie view. A final decision on the point of limitation has not been returned therein. Sand Plast (India) Ltd. (supra) has relied upon a Supreme Court decision reported at 2008 Volume 1 Supreme Court Cases page 125 (Transcore v. Union of India & Anr.). It has held that, the same was not a conclusive opinion on the point and that a final decision on such issue was to be taken by the Debts Recovery Tribunal.

Oriental Aroma Chemical Industries Ltd. (supra) has considered condonation of four years delay in filing the appeal. The ratio laid down therein has no manner of application in the facts of the present case. Abhay Ram (supra) has considered an application of Section 5 of the Limitation Act, 1963 for condoning a delay of 1689 days in filing the second appeal. The ratio has no manner of application in the facts of the present case. Brijesh Kumar (supra) has considered a condonation of delay of ten years under Section 54 of the Land Acquisition Act. Popat and Kotecha Property (supra) has considered an application under Order VII Rule 11(d) of the Code of Civil Procedure, 1908 claiming that, the suit was barred by limitation. It has held that, a plaint must be read as a whole. It is not permissible to cull out a sentence or passage of a judgment and to read it out of the context in isolation. The real object of Order VII Rule 11 of the Code of Civil Procedure, 1908 is to keep out of Courts irresponsible law suits. In the facts of that case, upon consideration of the statements made in the plaint, their Lordships had found that, the claim made therein was not barred by the laws of limitation. The ratio laid down therein is not attracted to the facts of the present case.

Section 4 of the Limitation Act, 1963, is based on the principle that, the law does not compel a man to do that which he cannot possibly perform and an Act of Court shall prejudice no man. This section has no manner of application in the facts of the present case. The initiation of a proceeding under Section 13(2) of the Act of 2002 is an original proceeding and Section 5 of the Limitation Act, 1963 would have no manner of application at the point of initiation of the proceedings. It applies to an appeal under Section 17 of the Act of 2002. 

Section 14 of the Limitation Act, 1963, permits exclusion of time for proceeding bona fide in a Court without jurisdiction. Three conditions have to co-exist for Section 14 to be attracted and applied. Firstly, the plaintiff must satisfy that, he was prosecuting another civil proceeding with due diligence. Secondly, the earlier and the latter proceeding must be founded on the same cause of action. Thirdly, the Court in which the former proceeding was prosecuted suffers from defect of jurisdiction or other cause of the nature rendering it incapable of entertaining such proceeding. 

Section 14 of the Limitation Act, 1963 saves the period of limitation in the event of a new proceeding being filed when the Court in which the former proceeding was being prosecuted suffers from defect of jurisdiction or defect of like nature. It does not contemplate two proceedings on the same cause of action at the same time. In the present case, the bank has not withdrawn the proceeding under Section 14 under the RDB Act, 1993, for defect in jurisdiction of the Tribunal to decide the same or otherwise. Rather the bank is proceeding under Section 19 of the RDB Act, 1993. It can proceed parallely by under the Act of 2002 provided that, the proceedings under the Act of 2002 are within the period of limitation. Pendency of the proceedings before the DRT, under the RDB Act, 1993, will not save the period of limitation for a proceeding under the Act of 2002, if the proceeding under the Act of 2002, is by itself barred by the laws of limitation. In other words, a bank cannot take the benefit of the pendency of the proceedings before the DRT to claim that, a proceeding under the Act of 2002, which is otherwise barred by limitation to be validly instituted within the period of limitation. Section 4, Section 14 and Section 15 of the Limitation Act, 1963, does not assist a bank to initiate a proceeding under Act of 2002 which is otherwise barred by limitation on the date of its initiation premised upon of a pendency of a proceeding under Section 19 of the RDB Act, 1993 before the DRT.

Section 14 of the Limitation Act, 1963 permits exclusion of the time taken to proceed bona fide in a Court without jurisdiction. Such section permits a plaintiff to present the same suit, if the Court of the first instance, returns a plaint from defect of jurisdiction or other causes of like nature, being unable to entertain it. In the present case, a secured creditor is not withdrawing a proceeding pending before the Debts Recovery Tribunal under Section 19 of the Act of 1993 to invoke the provisions of the Act of 2002. Rather the secured creditor is proceeding, independent of its right to proceed under the Act of 1993, while invoking the provisions of the Act of 2002. This choice of the secured creditor to invoke the Act of 2002 is independent of and despite the pendency of the proceedings under the Act of 1993, has to be looked at from the perspective of whether or not such an action meets the requirement of Section 36 of the Act of 2002, when the secured creditor is proposing to take a measure under Section 13(4) of the Act of 2002. Although, a secured creditor, as held in Transcore (supra), is entitled to take a remedy or a measure as available in the Act of 2002, despite the pendency of other proceedings, including a proceeding under Section 19 of the Act of 1993, in respect of the self-same cause of action, in my view, the invocation of such independent right under the Act of 2002, has to be done within the period of limitation prescribed under the Limitation Act, 1963 in terms of Section 36 of the Act of 2002. The Act of 2002 gives an independent right to a secured creditor to proceed against its financial assets and in respect of which such asset the secured creditor has security interest. The right to proceed, however, is subject to the adherence to the provisions of limitation as enshrined in the Limitation Act, 1963. The provisions of the Limitation Act, 1963 are, therefore, attracted to a proceeding initiated under the Act of 2002. That being the legal position, the invocation of the provisions of the Act of 2002 in the facts of the present case, on July 5, 2011, without there being an extension of the period of limitation by the act of the parties cannot be sustained.

Section 15 of the Limitation Act, 1963, allows exclusion of time in certain cases specified therein. Section 15 adds the period excluded therein to the period of limitation prescribed in the Schedule in the Act of 1963. In the facts of the present case, the bank has not contended that, it had suffered from any legal disability from invoking the provisions of the Act of 2002, within the period of limitation prescribed for the institution of a suit for recovery of money or for enforcement of mortgage. In the facts of the present case, divorced of the fact that, there are earlier proceedings pending, the secured creditor could not have issued a notice under Section 13 (2) of the Act of 2002 on July 5, 2011 as the same was barred by limitation on such date. There was no transaction between the petitioner and the secured creditor at least subsequent to 2001 to enlarge the period of limitation till July 5, 2011. The time to file a suit for recovery of money had expired in 2001 and a suit for mortgage in 2013, taking twelve years from 2001, being the date for limitation of the money suit. Then also the notice under Section 13(2) of the Act of 2002, dated March 3, 2013 is barred by limitation.

A proceeding under Section 19 of the RDB Act of 1993 may result in a certificate in favour of the bank. Such a certificate can be put into execution by invoking the provisions of the Act of 2002. This does not lead to an anomalous situation as the bank has contended. The laws of limitation do not take away a subsisting right, it merely postpones the enforcement of an existing right to be revived for enforcement upon happening of a future event. The bank on receiving a certificate under Section 19 of RDB Act, 1993, has its right to proceed under the Act of 2002 revived. It then needs to proceed under the Act of 2002, within the period of limitation, from the date of such certificate.

The issues raised are, therefore, answered by holding that, the initiation of the proceedings by the bank was barred by the laws of limitation on July 5, 2011 and all proceedings taken by the bank consequent upon and pursuant to the notice under Section 13(2) of the Act of 2002 dated July 5, 2011 are quashed including such notice.

W.P. No. 16511 (W) of 2016 is disposed of accordingly. Urgent certified website copies of this order, if applied for, be made available to the parties upon compliance of the requisite formalities.

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