2019 (9) TMI 1162 - AT - Companies Law

Condonation of delay in filing an appeal against the order of Tribunal - Period of limitation - Jurisdiction of Tribunal to register or give effect to conversion of the companies into LLPs - approach to Central Government only for compounding of offence - Section 56 of Limited Liability Partnership Act, 2008 - whether the appeal has been preferred within the prescribed period of limitation and in the event of delay whether the Appellant has carved out a case for Condonation of delay? - HELD THAT - The appeal is hopelessly time barred. Even if, the period of limitation is computed from 15th October, 2018 i.e. the date on which free certified copy was made available to the Appellant, the appeal has been preferred beyond prescribed 45 days and in absence of even the slightest whisper in the Condonation of delay application about a reasonable cause/ sufficient ground justifying Condonation of delay, there would be no justification to condone the delay. The appeal on this count is held to be not maintainable. It is manifestly clear that no delinquency can be attributed to Respondents for non-compliance or breach. While switching over to a computerized system the Appellant as also other concerned authorities were supposed to notify the affected persons and allow them to file the Rectified/ Revised Forms as mandated without slapping any penalty on them. Adopting a blood thirsty approach and that too against compliant entities is unwarranted moreso when such entities complied with the legal requirements and made compliances in accordance with the then prevailing system. This is apart from the reason that the concerned authorities accepted Form-8 and 11 from 2012 to 2016 without demur. No flaw can be found in the impugned order which does not suffer from any legal infirmity apart from being justice oriented and conforming to the spirit of law - appeal deserves to be dismissed on both grounds i.e. limitation as well as merits.

Summary

Issues:
1. Jurisdiction of the Tribunal regarding the refusal to register or give effect to conversion of companies into LLPs.
2. Timeliness of the appeal and condonation of delay.
3. Merits of the case regarding compliance with statutory procedures for conversion of companies into LLPs.

Analysis:
1. The Respondents filed a Company Petition against the Registrar of Companies, seeking permission to rectify errors in their Form - 3 without penalties. The Tribunal allowed the petition, stating no willful negligence by the Respondents, as they had been filing other required forms without objection. The Appellant contended that the Tribunal lacked jurisdiction as they had not refused registration or conversion, suggesting the Respondents approach the Central Government for compounding of offenses.

2. The Appellant's appeal was questioned for timeliness. The Companies Act allows a 45-day window for appeals, extendable on sufficient cause shown. The appeal was filed beyond the prescribed period, and the grounds for delay were found insufficient. The appeal was deemed time-barred and not maintainable.

3. If the appeal were considered on merit, it was argued that the Respondents complied with procedures in place during their conversion to LLPs. The Form-3 was accepted initially, followed by Forms 8 and 11 without objection until 2016. The introduction of a computerized system in 2013 caused confusion, as pre-2013 filings were not captured. The Tribunal found no fault in the Respondents' actions, emphasizing the need for authorities to communicate requirements clearly during system changes. The impugned order was upheld for being just and aligned with legal principles.

In conclusion, the appeal was dismissed on grounds of timeliness and merit. The impugned order was upheld, emphasizing the importance of clear communication from authorities during procedural changes and the need for justice-oriented decisions.