Mumbai: NCLT Rejects Canara Bank’s ₹742 Crore Insolvency Plea Against NSD Nirman Over Limitation
Mumbai, August 26, 2026: The National Company Law Tribunal (NCLT), Mumbai has rejected the Bandra-based Canara Bank’s insolvency plea of Rs 742.06-crore against Uttar Pradesh-based N.S.D. Nirman Private Limited, holding that the bank’s claim against the corporate guarantor was barred by limitation. The bank had filed the petition under Section 7 of the Insolvency and Bankruptcy Code (IBC),…
The National Company Law Tribunal (NCLT) in Mumbai has dismissed Canara Bank's petition seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against N.S.D. Nirman Private Limited. The bank claimed an outstanding amount of Rs 742.06 crore, but the tribunal ruled that its claim was barred by limitation. The main issue was determining when the limitation for enforcing the corporate guarantee began.
The tribunal examined a September 1, 2018 notice, concluding that the guarantee was invoked at that time. As per the Limitation Act, 1963, the limitation period for filing an application under Section 7 of the Insolvency and Bankruptcy Code is three years. Canara Bank failed to provide any valid acknowledgement that could have extended this period after the 2018 invocation.
The tribunal also rejected the bank's reliance on a January 20, 2025 demand notice, stating that a fresh demand notice years later could not revive a time-barred claim.
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