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CS Professional · Insolvency and Bankruptcy - Law and Practice · Adjudication and Appeals for Corporate Persons

A suit by Kiran Traders against Delta Polymers Ltd for recovery of dues is pending in a civil court. The NCLT then admits Delta Polymers Ltd into CIRP and a moratorium is in force for 140 days. Kiran Traders later considers filing a fresh application against Delta. How is limitation computed under section 60(6)?

The period during which the moratorium is in force is excluded when computing limitation for suits or applications by or against the corporate debtor. Section 60(6) overrides the Limitation Act, 1963 on this point, so the 140 days do not count against the creditor.

  1. AThe moratorium period is excluded in computing the period of limitationCorrect
  2. BThe moratorium period counts fully, as the Limitation Act, 1963 is unaffected
  3. CLimitation stops permanently once CIRP is admitted
  4. DOnly the first 30 days of the moratorium are excluded

Explanation

Section 60(6) says that, notwithstanding the Limitation Act, 1963 or any other law, the period during which the moratorium is in place is excluded when computing limitation for any suit or application by or against a corporate debtor. It is not counted, and it is not capped at 30 days.

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