Case Note & Summary
The dispute arose from an appeal filed by an erstwhile employee of a corporate debtor regarding unpaid salary arrears. The Appellant, who joined the company in 1983 and served until 2013, claimed Rs. 1.87 Crores in salary arrears from 1998 to 2013, supported by several acknowledgments of liability. The National Company Law Tribunal (NCLT) initially admitted the claim, but the National Company Law Appellate Tribunal (NCLAT) later set aside this order, citing a lack of explanation for the delay in raising the claim and the existence of a dispute. The Appellant argued that the acknowledgments demonstrated that the claim was within the limitation period, while the Respondent contended that the claim was time-barred and not reflected in the company's reports. The Supreme Court found that the last acknowledgment of liability was made on 30.09.2014, and since the petition was filed on 27.07.2017, it was within the limitation period. The court restored the NCLT's order, confirming the Appellant's claim and dismissing the Respondent's arguments regarding the dispute and time-bar. The appeal was allowed, and the NCLAT's judgment was set aside, reinstating the NCLT's decision.
Headnote
A) Insolvency and Bankruptcy - Acknowledgment of Liability - Validity of Claim - Insolvency and Bankruptcy Code, 2016, Section 9 - The court held that the acknowledgment of liability dated 30.09.2014 was valid, and the claim was not time-barred as the petition was filed within three years of the acknowledgment. The NCLT's admission of the application was thus restored, confirming the Appellant's entitlement to the claimed arrears (Paras 10-10).
Issue of Consideration
Whether the claim of the Appellant was time-barred and if there existed a dispute regarding the arrears of salary.
Final Decision
The Supreme Court allowed the appeal, restored the NCLT's order admitting the claim, and set aside the NCLAT's judgment.
Law Points
- Insolvency and Bankruptcy
- acknowledgment of liability
- limitation period
- operational creditor
- dispute existence
