2012 (6) TMI 531 - HC - Companies Law

Appeal - appeal was not accompanied by any application for condonation of delay - appeal had been dismissed as time barred - order of the BIFR was never received by the appellant company and the appellant company derived knowledge from one of the secured creditors - it is claimed that the appeal is filed within a period of 45 days Held that - Order of BIFR, sent to appellant-company, was returned back undelivered by Post Office and envelope was lying with Post Office - Application seeking recall of impugned order of AAIFR had also been dismissed on ground that AAIFR has no power of review and/or recall an order - relief sought for by company was really not in nature of review but to correct an error which had come into being while AAIFR passed order and, therefore, AAIFR like any other authority or Tribunal had incidental and/or ancillary powers to correct such errors.

Summary

Issues:
1. Appeal dismissed as time-barred by AAIFR.
2. Appellant claims appeal filed within time.
3. Appellant seeks recall of impugned order.
4. Appellant files writ petition under Article 226.
5. Inquiry conducted regarding service of order by BIFR.
6. Records show order returned undelivered.
7. Registrar of BIFR files affidavit confirming non-delivery.
8. Orders of AAIFR set aside, appeal directed to be heard on merits.
9. AAIFR criticized for error in passing orders.
10. Supreme Court observations on incidental powers of authorities.
11. Writ petition allowed, parties to bear own costs.

Analysis:

1. The appellant filed an appeal before the AAIFR against an order passed by BIFR, which was dismissed as time-barred for not being filed within 45 days and lacking an application for condonation of delay. The appeal was filed within time according to the appellant.

2. The appellant claimed the BIFR order was never received and learned about it from a secured creditor, subsequently filing the appeal within 45 days. The dispatch proof showed the order was sent by BIFR but not returned undelivered with any remark from postal authorities.

3. The appellant sought recall of the impugned order, which was dismissed by AAIFR citing no power of review. The appellant then filed a writ petition under Article 226 of the Constitution of India.

4. An inquiry was conducted regarding the service of the order by BIFR, and records confirmed the order was returned undelivered. The Registrar of BIFR filed an affidavit affirming the non-delivery and steps taken to rectify the process.

5. The High Court set aside the orders of AAIFR and directed the appeal to be heard on merits. The Court criticized AAIFR for errors in passing orders without verifying the delivery status of the order.

6. The High Court referred to Supreme Court observations on the incidental powers of authorities to correct errors and ensure effective exercise of statutory powers.

7. The writ petition was allowed, with each party bearing their own costs in the matter.