Supreme Court: Admission Of Claim By Resolution Professional Does Not Amount To Acknowledgment Of Debt as per S 18 of limitation Act

The third issue pertains to legal character of the admission of a claim by the IRP/RP and whether such admission can be construed as admission of liability so as to extend the period of limitation Under Section 18 of the 1963 Act. At the outset, it must be noted that scope and ambit of Section 18 of the 1963 Act are well-settled. For a writing to constitute a valid acknowledgment, it must be made by the party against whom the right is claimed, or by a person duly authorized on its behalf; it must be made before the expiration of the prescribed period of limitation; and, most importantly, it must evince a conscious and unequivocal intention to admit a subsisting jural relationship and an existing liability. A mere reference to a past transaction or a bald recital of a debt, without an intention to admit liability, would not suffice. The said principle has been authoritatively enunciated by this Court6. The provisions of the Code and the Regulations were considered by this Court7 and it has been held that RP has no adjudicatory powers and his role involves collation of claims. RP performs its administrative duties Under Section 18 of the Code. The admission of a claim by RP is merely an administrative/clerical task performed as part of its statutory duties Under Section 18 of the Code8 and, therefore, admission of claim by RP only means induction/entry of a claim. An admission of a claim by RP is akin to mere recital/reference of debt, which does not amount to an acknowledgment Under Section 18 of the 1963 Act9. Therefore, IRP's admission of secured financial creditors debt in first CIRP was not an acknowledgement Under Section 18 of 1963 Act. Accordingly, third issue is answered. {Para 16}

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 13158-13159 of 2025

Decided On: 29.04.2026

Shankar Khandelwal Vs. Omkara Asset Reconstruction Pvt. Ltd. and Ors.

Hon'ble Judges/Coram:

Pamidighantam Sri Narasimha and Alok Aradhe, JJ.

Author: Alok Aradhe, J.

Citation: 2026 INSC 429,MANU/SC/0421/2026

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How to appreciate evidence if there is an acknowledgement of liability in the Company's balance sheet for extension of limitation as per S 18 of the Limitation Act?

 A perusal of the aforesaid Sections would show that there is no doubt that the filing of a balance sheet in accordance with the provisions of the Companies Act is mandatory, any transgression of the same being punishable by law. However, what is of importance is that notes that are annexed to or forming part of such financial statements are expressly recognised by Section 134(7). Equally, the auditor's report may also enter caveats with regard to acknowledgements made in the books of accounts including the balance sheet. A perusal of the aforesaid would show that the statement of law contained in Bengal Silk Mills (supra), that there is a compulsion in law to prepare a balance sheet but no compulsion to make any particular admission, is correct in law as it would depend on the facts of each case as to whether an entry made in a balance sheet qua any particular creditor is unequivocal or has been entered into with caveats, which then has to be examined on a case by case basis to establish whether an acknowledgement of liability has, in fact, been made, thereby extending limitation Under Section 18 of the Limitation Act.{Para 22}

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 323 of 2021, 3228, 3765 of 2020, 

Decided On: 15.04.2021

 Asset Reconstruction Company (India) Limited

Vs. Bishal Jaiswal and Ors.

Hon'ble Judges/Coram:

Rohinton Fali Nariman, B.R. Gavai and Hrishikesh Roy, JJ.

Author: Rohinton Fali Nariman, J.

Citation: MANU/SC/0279/2021

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Whether the appellate court can remand a case if trial court has not correctly applied principles of acknowledgment of liability as per S 18 of limitation Act?

 Unfortunately NCLAT completely overlooked the pleadings revolving around the letter dated 28.09.2015 and the six cheques. The failure of the NCLAT as the first appellate authority to look into a very vital aspect such as this, vitiates its order, especially when NCLT has recorded a specific finding of fact on this.

{Para 8}

9. It is needless to point out that the law relating to the applicability of Section 18 of the Limitation Act, 1963 is fairly well settled. In Jignesh Shah and Anr. v. Union of India and Anr. MANU/SC/1319/2019 : (2019) 10 SCC 750, this Court pointed out that when time begins to run, it can only be extended in the manner provided in the Limitation Act. For holding so this Court made a reference to Section 18 of the Limitation Act. Though in Babu Lal Vardharji Gurjar v. Veer Gurjar Aluminium Industries Private Limited and Anr. MANU/SC/0589/2020 : (2020) 15 SCC 1, a two member Bench of this Court held that the reference in Jignesh Shah (supra) to Section 18 of the Limitation Act was only illustrative and that the ratio in B.K. Educational Services Private Limited v. Parag Gupta and Associates MANU/SC/1160/2018 : (2019) 11 SCC 633 did not stand altered by Jignesh Shah, no discordant note was struck. But the cloud of doubt created by Babu Lal (supra) was cleared subsequently in Laxmi Pat Surana v. Union Bank of India and Anr. MANU/SC/0221/2021 : (2021) 8 SCC 481. In Asset Reconstruction Co. (India) Limited v. Bishal Jaiswal and Anr. MANU/SC/0279/2021 : (2021) 6 SCC 366, this Court, while applying Section 18 of the Limitation Act, even went to the extent of holding that an entry in the balance sheet of the company could also be treated as an acknowledgment in writing, subject however to any caveat found in the accompanying reports.

10. The law as it has developed on the applicability of Section 18 of the Limitation Act and the circumstances in which it would apply, have also not been examined by NCLAT. Therefore, the order of NCLAT is liable to be set aside and the matter liable to be remanded back for a fresh consideration. 

 IN THE SUPREME COURT OF INDIA

Civil Appeal No. 4228 of 2020

Decided On: 29.03.2022

SVG Fashions Pvt. Ltd. (Earlier Known as SVG Fashions Ltd.)

Vs. Ritu Murli Manohar Goyal and Ors.

Hon'ble Judges/Coram:

Hemant Gupta and V. Ramasubramanian, JJ.

Author: V. Ramasubramanian, J.

Citation: MANU/SC/0370/2022

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Last Suo Motu Extension of Limitation by Supreme Court

 We deem it appropriate to dispose of the M.A. No. 21 of 2022 with the following directions:

1. The order dated 23.03.2020 is restored and in continuation

of the subsequent orders dated 08.03.2021, 27.04.2021

and 23.09.2021, it is directed that the period from

15.03.2020 till 28.02.2022 shall stand excluded for the

purposes of limitation as may be prescribed under any

general or special laws in respect of all judicial or quasijudicial

proceedings.

II. Consequently, the balance period of limitation remaining

as on 03.10.2021, if any, shall become available with effect

from 01.03.2022.

III. In cases where the limitation would have expired during

the period between 15.03.2020 till 28.02.2022,

notwithstanding the actual balance period of limitation

remaining, all persons shall have a limitation period of 90

days from 01.03.2022. In the event the actual balance

period of limitation remaining, with effect from 01.03.2022

is greater than 90 days, that longer period shall apply.

IV. It is further clarified that the period from 15.03.2020 till

28.02.2022 shall also stand excluded in computing the

periods prescribed under Sections 23 (4) and 29A of the

Arbitration and Conciliation Act, 1996, Section 12Aof the

Commercial Courts Act, 2015 and provisos (b) and (c) of

Section 138 of the Negotiable Instruments Act, 1881 and

any other laws, which prescribe period(s) of limitation for

instituting proceedings, outer limits (within which the

court or tribunal can condone delay) and termination of

proceedings.

IN THE SUPREME COURT OF INDIA

CIVIL ORIGINALJURISDICTION

MISCELLANEOUS APPLICATION NO. 21 OF 2022

IN

MISCELLANEOUS APPLICATION NO. 665 OF 2021

IN

SUO MOTU WRIT PETITION eCl NO.3 OF 2020

IN RE: COGNIZANCEFOR EXTENSION OF LIMITATION

WITH

MISCELLANEOUS APPLICATION NO.29 OF 2022

IN

MISCELLANEOUS APPLICATION NO. 665 OF 2021

IN

SUO MOTU WRIT PETITION eCl NO. 3 OF 2020

Dated: January 10, 2022

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Whether Supreme Court order on the extension of limitation dated January 10, 2022, applies to Commercial courts Act proceedings?

In that view of the matter, the period from

15.03.2020 till 28.02.2022 shall have to be excluded for

the purposes of limitation as may be prescribed under any

General or SPECIAL LAWS in respect of all judicial or

quasi-judicial proceedings. The Commercial Courts Act,

2015 being a Special Law, the said order shall also be

applicable with respect to the limitation prescribed

under the Commercial Courts Act, 2015 also.

In view of the above and for the reasons stated

above and more particularly when the 120 days period

expired in the present case on 09.05.2020 which was

during the aforesaid period as prescribed by this Court

in the aforesaid order, the High Court ought to have

excluded the aforesaid period for the purpose of filing

the written statement and ought to have permitted to

take the written statement on record. The impugned

judgment and order passed by the High Court refusing to

condone the delay and take on record the written

statement is hereby quashed and set aside. It is directed

that the written statement, already filed, be taken on

record and the same be considered in accordance with law.

 IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. OF 2022

(@ Special Leave Petition (C) No. 2522/2022)

BABASAHEB RAOSAHEB KOBARNE & ANR. Vs PYROTEK INDIA PRIVATE LIMITED & ORS. 

Dated: MAY 09, 2022

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Supreme Court order on extension of limitation dated January 10, 2022

  Taking into consideration the arguments advanced by learned

counsel and the impact of the surge of the virus on public health

and adversities faced by litigants in the prevailing conditions, we

deem it appropriate to dispose of the M.A. No. 21 of 2022 with

the following directions:

I. The order dated 23.03.2020 is restored and in continuation

of the subsequent orders dated 08.03.2021, 27.04.2021

and 23.09.2021, it is directed that the period from

15.03.2020 till 28.02.2022 shall stand excluded for the

purposes of limitation as may be prescribed under any

general or special laws in respect of all judicial or quasijudicial

proceedings.

II. Consequently, the balance period of limitation remaining

as on 03.10.2021, if any, shall become available with effect

from 01.03.2022.

III. In cases where the limitation would have expired during

the period between 15.03.2020 till 28.02.2022,

notwithstanding the actual balance period of limitation

remaining, all persons shall have a limitation period of 90

days from 01.03.2022. In the event the actual balance

period of limitation remaining, with effect from 01.03.2022

is greater than 90 days, that longer period shall apply.

IV. It is further clarified that the period from 15.03.2020 till

28.02.2022 shall also stand excluded in computing the

periods prescribed under Sections 23 (4) and 29A of the

Arbitration and Conciliation Act, 1996, Section 12A of the

Commercial Courts Act, 2015 and provisos (b) and (c) of

Section 138 of the Negotiable Instruments Act, 1881 and

any other laws, which prescribe period(s) of limitation for

instituting proceedings, outer limits (within which the

court or tribunal can condone delay) and termination of

proceedings.

IN THE SUPREME COURT OF INDIA

CIVIL ORIGINAL JURISDICTION

MISCELLANEOUS APPLICATION NO. 21 OF 2022

IN

MISCELLANEOUS APPLICATION NO. 665 OF 2021

IN

SUO MOTU WRIT PETITION (C) NO. 3 OF 2020

IN RE: COGNIZANCE FOR EXTENSION OF LIMITATION

WITH

MISCELLANEOUS APPLICATION NO.29 OF 2022

IN

MISCELLANEOUS APPLICATION NO. 665 OF 2021

IN

SUO MOTU WRIT PETITION (C) NO. 3 OF 2020

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Whether cash payment simpliciter will qualify for extension of limitations U/S 18 and 19 of Limitation Act?

 The only other way in which the suit could have been within limitation was if the suit was based on an open, mutual and current account. An open, mutual and current account under Article 1 of the Limitation Act, 1963 would only exist if there are shifting balances vide Hindustan Forest Company v.. Lal Chand & Others, AIR 1959 SC 1349 and Kesharichand Jaisukhal v. Shillong Banking Corporation, AIR 1965 SC 1711. In the present case, it is seen that in fact the appellant/plaintiff has not filed a copy of its statement of account because what is filed are only individual entries and the same are called as statement of account. Even if we take the entries filed as being a statement of account, such entries do not show shifting balances and once there are no shifting balances, the statement of account relied upon by the appellant/plaintiff is thus not an open, mutual and current account. In fact, the witness of the respondent/defendant no. 1, Sh. Karan K. Luthra, has specifically deposed with respect to the account not being an open, mutual and current account in terms of para 4 of his affidavit by way of evidence dated 13.10.2004.

9. Finally it was argued that the suit is within limitation as respondent/defendant no. 1 is said to have paid a cash amount of Rs. 50,000/- on 29.05.1985, however, this argument is rejected because this cash entry in Ex. DW 1/2 is without any date with the fact that this cash entry is not in an account maintained by the respondent/defendant no. 1, but the entry is an entry in an account of the appellant/plaintiff and the copy of which was given to the respondent/defendant no. 1 and witness DW 1 has categorically and specifically denied any cash payment to the appellant/plaintiff as it is deposed by DW 1 that all payments to appellant/plaintiff have only been made by cheques. A cash payment simpliciter will not qualify for extension of limitations under Sections 18 and 19 of the Limitation Act, as it is not proved.

Delhi High Court

M/S Continental Advertising Pvt. ... vs M/S Karan & Co. on 15 October, 2018

CORAM:

HON'BLE MR. JUSTICE VALMIKI J.MEHTA 

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Whether limitation for taking cognizance of offence can be extended by non speaking order?

 Section 19 of the 1939 Act prescribes maximum punishment for one year or with fine which may extend to one thousand rupees or with both. Section 468 of the Cr.P.C. which deals with bar for taking cognizance after lapse of the period of limitation indicates that the period of limitation shall be one year, if the offence is punishable with imprisonment for a term not exceeding one year. Section 469 of the Cr.P.C. deals with commencement of the period of limitation. In this case, according to the prosecution case, the gold was pledged fourteen years prior to the date of giving of evidence of P.W. 1 and four years thereafter, when he gave back the double the quantity of paddy, in spite of that the petitioner allegedly did not return back the gold ornaments. The Block Development Officer vide letter No. 4329 dated 21.10.1990 has informed about the detection of the cases to the Sub Collector, Dharmgarh. In spite of that, the case was registered only on 25.12.1991 and cognizance was taken on 11.03.1992. Therefore, in view of the punishment prescribed for the offence under section 19 of the 1939 Act, I am of the view that the case was instituted after the lapse of the period of limitation. The contentions raised in the Courts below regarding this aspect was turned down on the ground that section 473 Cr.P.C. empowers the Court for making extension of the limitation period.

Law is well settled that while taking cognizance of an offence for which period of limitation has been fixed in the Cr.P.C., after the expiry of the period of limitation, the Magistrate has to pass a speaking order assigning the reasons for exercise of the discretion as required under section 473 of the Cr.P.C. On perusal of the order of cognizance dated 11.03.1992, it appears that the Magistrate has neither kept such provision in view nor passed any speaking order assigning the reason for exercise of the discretion. He has simply taken the cognizance which read as follows:-

"11.03.1992-Complainant present. Accused is also present. Cognizance u/s. 19 of the O.M.L. Act is taken. Complainant is to adduce evidence. Put up on 29.04.1992."

Therefore, the order of taking cognizance as well as the entire proceeding instituted after the lapse of the period of limitation without passing a speaking order assigning the reasons for exercise of the discretion as required under section 473 of the Cr.P.C. for condoning the delay is vitiated in the eye of law.

IN THE HIGH COURT OF ORISSA AT CUTTACK

Criminal Revision No. 215 of 2001

Decided On: 01.12.2016

 Suryanarayan Behera

Vs.

Ganesh Majhi and Ors.

Hon'ble Judges/Coram:

S.K. Sahoo, J.

Citation: 2017 CRLJ 641 Orissa

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Whether period of limitation can be extended after the claim gets barred by limitation?

No period of limitation can be extended after the claim gets barred by limitation. A specified period is allowed by law to parties to sue to afford inherent protection to parties to a contract who have not been sued within the period of limitation to deal with their 

properties and transaction with further parties thereafter. Limitless extension of time to sue after the period specified in law expires would cause tremendous prejudice and injustice to parties who seek to deal with their own properties after contracting with a party who has allowed these rights to lapse by limitation. The very expression "Limitation" implies limitation of time to sue. The right to sue cannot go on endlessly. If that were allowed a very strange, unjust consequence would arise. No party would be able to enter into a transaction even after the period of limitation in Law expired if the earlier transaction did not materialise. This would constitute a impediment on the Defendants' vested rights.

18. Consequently, the statements in the plaint must be read as a whole. Reading such statements the cause of action which initially accrued to the Plaintiffs must be seen. How the Plaintiffs sought to enforce their legal rights within the period of limitation from the date of the accrual of such cause of action has to be seen. Further statements in the plaint relating to whatever may have transpired between the Defendants and further contracting parties after their claim in favour of the Plaintiffs got barred by limitation cannot show the extension of the period of limitation

Bombay High Court

M/S. Anand Laxmi Enterprises vs Vasant Balu Mhatre & Ors on 30 September, 2008

Bench: R. S. Dalvi

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