It was observed by the Supreme Court that there was no bar to permit amendment of pleadings or to file additional documents in any application under Section 7 of the Insolvency and Bankruptcy Code.
The issue regarding the appeal filed by the Bank against NCLAT judgment dismissing its application under Section 7 IBC was whether there is any bar in law to the amendment of pleadings, filing additional documents in Form-1. Here, the adjudicating authority had permitted the applicant bank to file additional documents and also to amend the application. Later, it admitted the Petition under Section 7 of the IBC and appointed an Interim Resolution Professional rejecting the objection of the Corporate Debtor on the issue of limitation. NCLAT, in appeal, held that the application was barred by limitation. (Appeal relied on the case, Babulal Vardharji Gurjar V. Veer Gurjar Aluminium Industries Private Limited).
The bench said that there was no bar in law to the amendment of pleadings in an application under Section 7 of the IBC, apart from those initially filed along with the application under Section 7 of the IBC in Form-1. In the absence of any express provision which either prohibits or sets a time limit for filing of additional documents, it cannot be said that the Adjudicating Authority committed any illegality or error in permitting the Appellant Bank to file additional documents.
The bench added, when there is an inordinate delay, the Adjudicating Authority might, at its discretion, decline the request of an applicant to file additional pleadings and/or documents, and proceed to pass a final order. The decision of the Adjudicating Authority to allow the request of the Appellant Bank for the filing of additional documents with supporting pleadings, and to consider such documents and pleadings will not call for interference in appeal.
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