In Brief
Respondent No. 2 was declared a non-performing asset in 2011. The State Bank of India initially pursued debt recovery through the Debt Recovery Tribunal but later assigned the debt to an Asset Reconstruction Company, which filed a Section 7 application under the Insolvency and Bankruptcy Code in 2017 for recovery of the principal and accrued interest. The NCLT and NCLAT admitted the application, holding that limitation ran from the Code's commencement. The Supreme Court allowed the appeal, holding that Article 137 (residuary article) of the Limitation Act governs Section 7 applications, not Article 62 (which applies only to suits). Limitation commenced from 2011 when the debt became due, making the 2017 application time-barred."
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