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CS Professional · Insolvency and Bankruptcy - Law and Practice · Insolvency Resolution of Individuals and Partnership Firms

Under Part III, a moratorium order was in force for 60 days in respect of debtor Sunil Mehta, an individual. During this time, a suit by the debtor to recover a debt owed to him could not be filed. How is the moratorium period treated in computing limitation for that suit?

The period of moratorium is excluded. Section 179(3) overrides the Limitation Act, 1963 and any other law, providing that in computing limitation for a suit or application in the name and on behalf of the debtor, the time during which the moratorium is in place is not counted.

  1. AIt is counted, since the Limitation Act, 1963 prevails
  2. BIt is excluded from the limitation period under section 179(3)Correct
  3. CIt is excluded only if the DRT passes a separate order
  4. DIt is counted only up to thirty days

Explanation

Section 179(3) says that notwithstanding the Limitation Act, 1963 or any other law, in computing limitation for any suit or application in the name and on behalf of a debtor for which a moratorium order has been made under this Part, the moratorium period is excluded. No further order is needed.

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