IDBI Trusteeship Services Limited vs Manish Jain & Ors - Case Procedural Update

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Idbi Trusteeship Services Limited vs Manish Jain & Ors on 23 March, 2026

$~38
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision: 23rd March, 2026
+ CS(COMM) 800/2025 & I.A. 7470/2026, O.A. 59/2026
IDBI TRUSTEESHIP SERVICES LIMITED .....Plaintiff
Through: Mr. Pranjit Bhattacharya, Ms. Salonee
Shukla, Ms. Souravi Das, Ms. Shalini
Singh, Advocates (M:8980006115)
versus

                             MANISH JAIN & ORS.                                   .....Defendants
                                           Through:          Mr. Sarul Jain, Advocate for D-1
                                                             (M:9899455459)
                                                             Mr. Rajat Joneja, Ms. Sakshi Kapoor,
                                                             Ms. Tina Aneja, Advocates for D-2
                                                             (M:9999185553)
                             CORAM:
                             HON'BLE MS. JUSTICE MINI PUSHKARNA

                             MINI PUSHKARNA, J. (ORAL) I.A. 7470/2026

1. The present application has been filed on behalf of defendant no. 2
                     seeking condonation of delay of 14 days in filing the O.A. 59/2026.
   

2. In view of the submissions and the averments made in the application,
                     the delay of 14 days in filing the original appeal is condoned.
   

3. The application is accordingly disposed of.
   

O.A. 59/2026 4. The present appeal has been filed on behalf of defendant no. 2 under
Chapter II Rule 5 of the Delhi High Court (Original Side) Rules, 2018 read
with Section 151 of Code of Civil Procedure, 1908 (" CPC "), seeking setting
aside of the impugned order dated 27th January, 2026, passed by the learned Signature Not Verified Digitally Signed Page 1 of 7 By:HARIOM SHARMA Signing Date:25.03.2026 09:29:03 Joint Registrar (Judicial).

1. It is submitted that by way of the impugned order dated 27 th January,
   2026, learned Joint Registrar (Judicial) has closed the right of the defendant
   no. 2 to file written statement.

2. It is submitted that the plaintiff filed company petition under Section
   95 of the Insolvency and Bankruptcy Code, 2016 ("IBC") against defendant
   no. 2, for initiating personal insolvency proceedings before the National
   Company Law Tribunal ("NCLT"), New Delhi Bench. Vide order dated 20th
   February, 2025, an Interim Resolution Professional was appointed for the
   defendant no. 2 herein.

3. Thus, it is submitted that, upon admission, an interim moratorium
   under Section 96 of the IBC, came into effect automatically. It is submitted
   that the present suit has been filed subsequently in July, 2025 and summons
   were issued on 05th August, 2025.

4. Thus, it is submitted that once a moratorium is in effect, no suit
   against defendant no. 2 could have been filed, and on that ground, there was
   no question of running of any time for filing of written statement. He further
   submits that the aforesaid aspect was not noted by the learned Joint
   Registrar (Judicial), at the time of passing the impugned order.

5. Learned counsel for defendant no. 2 further submits that defendant no.
   2 had filed an application for rejection of the plaint under Order VII Rule 11
   CPC. He, thus, submits that in view of the pendency of the aforesaid
   application, defendant no. 2 was not required to file the written statement.
   He relies upon various judgments of this Court and the Supreme Court in
   this regard.

6. Per contra, learned counsel for the plaintiff submits that the statutory Signature Not Verified Digitally Signed Page 2 of 7 By:HARIOM SHARMA Signing Date:25.03.2026 09:29:03 period of 120 days for filing the written statement by defendant no. 2
   expired on 03rd December, 2025. He further submits that he subsequently
   moved an application for closing the right of defendant no. 2 to file written
   statement.

7. He submits that application under [Order VII Rule 11 CPC](https://indiankanoon.org/doc/161831507/) for
                     rejection of plaint was filed on behalf of defendant no. 2, only subsequently.
   

8. On a pointed query by this Court, learned counsel for defendant no. 2
                     does not dispute the timelines as indicated by learned counsel for the
                     plaintiff.
   

9. Having heard learned counsels for the parties, this Court notes the
                     relevant dates, which are undisputed, as follows:
   

I. 03rd December, 2025 Outer limit of statutory period for filing
the written statement, i.e., 120 days,
expired.

II. 05th December, 2025 Application, i.e., I.A. 30796/2025 filed by
the plaintiff for closure of right of
defendant no. 2 to file written statement.

III. 09th December, 2025 Notice was issued in the aforesaid
application.

IV. 14th December, 2025 Application under Order VII Rule 11 CPC,
i.e., I.A. 32519/2025, filed by defendant
no. 2 for rejection of the plaint.
14. Perusal of the aforesaid undisputed timelines clearly show that
application under Order VII Rule 11 CPC for rejection of the plaint, was
filed by defendant no. 2 only on 14 th December, 2025, much after the
statutory period of 120 days for filing of written statement, had expired.

1. The defendant no. 2 has relied upon judgments of the Supreme Court
                     to submit that once an application has been filed by a defendant for rejection Signature Not Verified Digitally Signed                                                                                Page 3 of 7 By:HARIOM SHARMA Signing Date:25.03.2026 09:29:03 of the plaint under order VII [Rule 11 CPC](https://indiankanoon.org/doc/161831507/), the said application is to be
                     considered first, and that time for filing the written statement has to be given
                     to such defendant, only after decision in the application for rejection of
                     plaint. There is no quarrel with the said proposition. However, once
                     statutory period for filing written statement has already lapsed, subsequent
                     filing of an application for rejection of plaint by a defendant will not revive
                     such statutory period for filing written statement. Therefore, filing of an
                     application for rejection of plaint by defendant no. 2 after lapse of statutory
                     period for filing written statement, will not entitle the defendant no. 2 for
                     grant of any extension of time for filing written statement on that ground.
   

2. In this regard, reference may be made to the Judgment of Supreme
   Court in the case of R.K. Roja Versus U.S. Rayudu and Another, (2016) 14
   SCC 275, wherein, it has been held as follows:

"xxx xxx xxx

1. Once an application is filed under Order 7 Rule 11 CPC, the court has to dispose of the same before proceeding with the trial. There is no point or sense in proceeding with the trial of the case, in case the plaint (election petition in the present case) is only to be rejected at the threshold. Therefore, the defendant is entitled to file the application for rejection before filing his written statement. In case the application is rejected, the defendant is entitled to file his written statement thereafter (see Saleem Bhai v. State of Maharashtra [Saleem Bhai v. State of Maharashtra, (2003) 1 SCC 557] ). But once an application for rejection is filed, the court has to dispose of the same before proceeding with the trial court. To quote the relevant portion from para 20 of Sopan Sukhdeo Sable case [Sopan Sukhdeo Sable v. Charity Commr., (2004) 3 SCC 137] :

(SCC pp. 148-49)
"20. ... Rule 11 of Order 7 lays down an independent remedy
made available to the defendant to challenge the maintainability
of the suit itself, irrespective of his right to contest the same on
merits. The law ostensibly does not contemplate at any stage
when the objections can be raised, and also does not say in
express terms about the filing of a written statement. Instead, the
word "shall" is used, clearly implying thereby that it casts a duty Signature Not Verified Digitally Signed Page 4 of 7 By:HARIOM SHARMA Signing Date:25.03.2026 09:29:03 on the court to perform its obligations in rejecting the plaint when
the same is hit by any of the infirmities provided in the four
clauses of Rule 11, even without intervention of the defendant."
6. In Saleem Bhai case [Saleem Bhai v. State of Maharashtra, (2003)
1 SCC 557] , this Court has also held that: (SCC p. 560, para 9)
"9. ... a direction to file the written statement without deciding
the application under Order 7 Rule 11 cannot but be a procedural
irregularity touching the exercise of jurisdiction by the trial
court."

However, we may hasten to add that the liberty to file an application
for rejection under Order 7 Rule 11 CPC cannot be made as a ruse
for retrieving the lost opportunity to file the written statement.
xxx xxx xxx"

(Emphasis Supplied)

1. Perusal of the aforesaid judgment makes in manifest that the Supreme
   Court has categorically held that a defendant is entitled to file an application
   for rejection of plaint under Order VII Rule 11 of the CPC, before filing the
   written statement. In case the application is rejected, the defendant is entitled
   to file its written statement thereafter.

2. However, the Supreme Court has clarified that filing of an application
   for rejection of plaint by a defendant will not retrieve a lost opportunity,
   meaning thereby, once the statutory period of filing the written statement
   has elapsed, subsequent filing of an application under Order VII Rule 11 of
   the CPC, for rejection of plaint by the defendant, would not revive the said
   statutory period.

3. Accordingly, it is held that once the statutory period of filing the
   written statement has elapsed, any subsequent filing of an application under Order VII Rule 11 of the CPC, shall not revive the statutory period in any
   manner whatsoever, and shall not extend the statutory period for filing the
   written statement.
   Signature Not Verified Digitally Signed Page 5 of 7 By:HARIOM SHARMA Signing Date:25.03.2026 09:29:03

4. In this regard, judgment dated 15th May, 2025, passed in CM(M)
   900/2025, titled as Zenith Vipers Solutions Pvt. Ltd. Versus Jasmeet Singh
   Marwah, is referred to, wherein, it has been held as under:

"xxx xxx xxx

1. Merely, because an application under Order VII Rule 11 CPC has been filed and is pending adjudication would not ipso facto extend the period of limitation meant for filing of written statement. Reference in this regard be made to SCG Contracts (India) (P) Ltd. v. K.S. Chamankar Infrastructure (P) Ltd., (2019) 12 SCC 210 wherein Hon'ble Supreme Court clarified as under:-

"14. The learned counsel appearing for the respondents also
relied upon [R.K. Roja v. U.S. Rayudu R.K. Roja v. U.S. Rayudu,
(2016) 14 SCC 275 : (2017) 3 SCC (Civ) 270] for the proposition
that the defendant is entitled to file an application for rejection of
plaint under Order 7 Rule 11 before filing his written statement.
We are of the view that this judgment cannot be read in the
manner sought for by the learned counsel appearing on behalf of
the respondents. Order 7 Rule 11 proceedings are independent of
the filing of a written statement once a suit has been filed. In fact,
para 6 of that judgment records: (SCC p. 277)
"6. ... However, we may hasten to add that the liberty to file an
application for rejection under Order 7 Rule 11 CPC cannot be
made as a ruse for retrieving the lost opportunity to file the
written statement.""

xxx xxx xxx"
(Emphasis Supplied)

1. Accordingly, the plea of the defendant no. 2 that its right for filing the
   written statement ought not to have been closed, since an application under Order VII Rule 11 of the CPC had been filed subsequently, cannot be
   accepted and the same is rejected.

2. As regards the contention of the defendant no. 2 with regard to
   interim moratorium operating under Section 96 of the IBC on account of
   which, the suit against the defendant no. 2 is not maintainable, the same is
   subject matter of an application filed on behalf of defendant no. 2 under Signature Not Verified Digitally Signed Page 6 of 7 By:HARIOM SHARMA Signing Date:25.03.2026 09:29:03 Order VII Rule 11 CPC, for rejection of the plaint, i.e., I.A. 32519/2025.
   Accordingly, this aspect shall be considered by the Court while adjudicating
   the aforesaid application filed on behalf of defendant no. 2.

3. Noting the aforesaid, no merit is found in the present appeal, the same
   accordingly, dismissed.

CS(COMM) 800/2025

1. It is to be noted that reply in I.A. 32519/2025, has been filed on behalf
   of the plaintiff.

2. Learned counsel for defendant no. 2 seeks and is granted liberty to file
   rejoinder to the said reply filed on behalf of the plaintiff, to the aforesaid
   application.

3. Let the needful be done, within a period of four weeks, from today.

4. List before the Joint Registrar (Judicial) on 06th July, 2026, i.e., the
   date already fixed.

MINI PUSHKARNA, J
MARCH 23, 2026/au Signature Not Verified Digitally Signed Page 7 of 7 By:HARIOM SHARMA Signing Date:25.03.2026 09:29:03