2019 (11) TMI 1131 - AT - Companies Law

Condonation of delay - Period of limitation - supply for Transfer of Shares and Rectification of Register - case of appellant is that the Adjudicating Authority had failed to appreciate that the statutory prescribed time period to supply for Transfer of Shares and Rectification of Register is 60 days from the date of receipt of refusal or in case no notice of refusal was transmitted by the Company, within a period of 90 days from the date of which the Instrument was transferred was delivered to the Company. HELD THAT - While dealing with an Application for condonation of Delay , the concerned Tribunal / Appropriate Authority is only required to consider whether the Plea of Sufficiency of Cause is a reasonable one or otherwise, of course after taking into consideration of the facts and circumstances of a given case. Undoubtedly, consideration of an existence of a Sufficient Cause is within the ambit of the concerned Authority, which has to be exercised based on sound judicial principles - It cannot be gain said that Right to refuse registration of transfer of shares, Sufficient Cause is question of law and the cause shown for refusal is sufficient or otherwise in a given case, can also be a mixed question of law and fact. Besides this, a refusal may be on the basis of Breach of Law or any other Sufficient Cause . One cannot brush aside a vital fact that in Law, a Lis is to be decided on merits and no party should be non-suited harping on technicalities and also by adopting a pedantic approach. - There is no two opinion of the fact that although Day-Today explanation for Condonation of Delay is not necessary, but Sufficiency of Reason must exist. In the instant case, this Tribunal comes to a consequent conclusion that the Tribunal had borne in mind the well settled principal in Law that when the matter is fought on merits , the same is to be disposed of in accordance with law etc - appeal dismissed.

Issues Involved:
1. Condonation of delay in filing the appeal.
2. Jurisdiction and power of the Adjudicating Authority to condone the delay.
3. Statutory prescribed time period for the transfer of shares and rectification of the register.
4. Sufficiency of reasons provided for the delay.
5. Legal precedents and their applicability.

Detailed Analysis:

1. Condonation of Delay in Filing the Appeal:
The primary issue addressed in this judgment is the condonation of a 186-day delay in filing an appeal by the Respondent/Applicant. The Appellants argued that the delay was originally 1795 days, starting from the first refusal to register the transfer of shares on 29th November 2011. The Tribunal, however, condoned the delay subject to the Respondent depositing ?25,000 in the Prime Minister’s National Relief Fund.

2. Jurisdiction and Power of the Adjudicating Authority to Condon the Delay:
The Appellants contended that the Adjudicating Authority lacked jurisdiction to condone such a significant delay, emphasizing that the statutory period for filing an appeal is 60 days from the date of refusal or 90 days from the date the instrument of transfer was delivered to the company. The Tribunal, however, exercised its discretionary power to condone the delay, considering the sufficiency of the cause presented by the Respondent.

3. Statutory Prescribed Time Period for Transfer of Shares and Rectification of Register:
The Appellants highlighted that the statutory period for the transfer of shares and rectification of the register is strictly defined. They argued that the cause of action for filing the appeal lapsed on 28th March 2012, and the Respondent failed to provide a sufficient reason for the delay. The Tribunal noted that under the Companies Act, 1956, no specific time limit was prescribed for filing an appeal against refusal, whereas the Companies Act, 2013, stipulates a 60-day period from the date of refusal.

4. Sufficiency of Reasons Provided for the Delay:
The Tribunal emphasized that the sufficiency of the cause for the delay is a critical factor. The Respondent argued that the delay was due to the need to collect documents from 2011 and the geographical distance between the registered offices of the parties involved (Kolkata and Ludhiana). The Tribunal accepted these reasons, considering them sufficient to condone the delay.

5. Legal Precedents and Their Applicability:
The Appellants cited several legal precedents, including decisions from the Hon’ble Supreme Court and High Courts, to argue against the condonation of the delay. They referenced the case of Mackintosh Burn Limited Vs. Sarkar & Chowdhury Enterprises Private Limited, where the Supreme Court set aside previous orders condoning delays. Conversely, the Respondent cited cases where delays were condoned, such as Property Company Limited vs. Rohinten Daddy Mazda and Golden Vyapar (P) Ltd. & Ors. Vs. Shefali Papers Ltd. & Ors. The Tribunal considered these precedents but ultimately decided to condone the delay based on the specific facts and circumstances of the case.

Conclusion:
The Tribunal concluded that the delay in filing the appeal was sufficiently explained and condoned the delay, allowing the main matter to be heard on its merits. The Tribunal emphasized that legal disputes should be resolved based on their merits rather than technicalities. Consequently, the appeal was dismissed, and the connected interlocutory application was closed. The Tribunal's decision was based on sound judicial principles and did not suffer from any material irregularity or patent illegality.

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