Plea of running account cannot be raised if there are no documentary evidence in support thereof

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Shubham Budhiraja [LLB, ACS, BCOM(H)], 

Budhirajalawchambers@gmail.com , +91-9654055315


The Hon’ble NCLAT, New Delhi in the case of M/s Murphy Steel v. M/s Gujarat Wedge Wire Screens Limited, Company Appeal (AT) Insolvency No. 171/2024 upheld the NCLT’s order wherein claim of operational creditor was dismissed for barred by limitation.

This is a case where operational creditor set up a plea of running account to justify 26 invoices. All these invoices were of period between 2011 to 2016 whereas section 9 petition was filed in September 2020.

The Learned NCLT dismissed the petition being time barred. The Hon’ble NCLAT upheld the findings of Learned NCLT and held that there is no document/agreement between the two parties which evidences running account payment underlying their business operations. In the absence of any documentary evidence which provides foundational basis to the claim that there was a running account, the decision in Shri Abhinandan Jain v. Tanaya Enterprises Pvt. Ltd. in Company Appeal (AT) (Ins.) No. 1017 of 2020 is of no relevance.

 

 

 

 


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