In Brief
State Bank of India filed a Section 7 petition seeking to initiate corporate insolvency proceedings against Krishidhan Seeds for default on loan facilities aggregating Rs. 189 crores. The NCLT and NCLAT rejected the petition, holding it was barred by limitation as filed beyond the prescribed period from the original default date. The Supreme Court allowed the appeal, clarifying that Section 18 of the Limitation Act (which provides for extension through acknowledgements of liability) applies to IBC proceedings. The Court held that unqualified acknowledgements in balance sheets made within three years of the original default can extend the limitation period, and remitted the case to the NCLT for fresh adjudication on the merits.
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