No Fresh Cause Of Action Comes Into Existence If Correct Date Of Default Is Allowed To Be Stated In Application: NCLT Mumbai

The National Company Law Tribunal (NCLT), Mumbai Bench, comprising Prabhat Kumar (Member-Technical) and Sushil Mahadeorao Kochey (Member-Judicial), has ruled that no fresh cause of action comes into existence if the correct date of default is allowed to be stated in the application. The application was filed by the Indian Bank, erstwhile Allahabad Bank, Applicant, under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 r/w Rule 11 of the NCLT Rules, 2016, seeking the leave to amend the date of default in the company petition no. C.P. (IB)/571(MB)2024. Relying upon the rulings of Sanjeeb Ranjeet Das v. M/s Punjab National Bank, the applicant argued that it is entitled to bring on record the additional documents, and the adjudicating authority can accept that for adjudication. Per contra, the respondent, personal guarantor, relied upon the rulings of Indrajeet Singh Bindra vs. Ramesh Kumari and Others 2024 SCC Online Del 8613 to argue that at this stage the time-barred cause of action cannot be revived by amendment. Observations of the NCLT The tribunal observed that the decision relied upon by the respondent is not applicable here, as the facts are distinguishable and the amendment in that ruling resulted in a fresh cause of action barred by limitation. The NCLT further observed that the sought amendment didn't create any fresh cause of action but merely sought to correct the date of default, which the tribunal is bound to ascertain. “No fresh cause of action comes into existence if the correct date of default is allowed to be stated in the application,” the tribunal observed. Accordingly, the tribunal allowed the amendment. Case Name: Indian Bank v. Nipun Verma Case No.: IA (I.B.C)/3675(MB)2025 IN C.P. (IB)/571(MB)2024 Coram: Shri Prabhat Kumar (Member-Technical) and Shri Sushil Mahadeorao Kochey (Member-Judicial) Order Date: 06.10.2025 Click Here To Read/Download The Order

No Fresh Cause Of Action Comes Into Existence If Correct Date Of Default Is Allowed To Be Stated In Application: NCLT Mumbai

Mohd.Rehan Ali

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