2024 (4) TMI 240 - AT - Insolvency and Bankruptcy

Condonation of delay in filing an appeal - limitation in preferring an appeal - Rejection of Application of Claim, raised by the Appellant - HELD THAT - The Learned Counsel for the Appellant in sub para II of Para 3 of the Delay Condonation Application has given unjustifiable reason which were not even prevalent at the time when the period of limitation for preferring an appeal was actually subsisting. That the counsel for the Appellant has endeavoured to argue certain grounds in support of the delay condonation application which are not even pleaded in the principal delay condonation application and if this be the situation his plea which is not taken and pleaded in defence for seeking condonation of delay cannot be considered by this Tribunal, since being beyond the pleadings. It would be too hypothetical to accept the arguments extended by the Learned Counsel for the Appellant that he had to seek legal advice and that his placement in Bengaluru had created an embargo in filing an Appeal in time. In fact, due to technological development, these two reasons seems to be without any plausible justification, which could be acceptable by this Tribunal to condone the delay of 28 days which has chanced in filing an appeal, hence as such the period is not extendable under the 2nd proviso of Section 61. Appeal dismissed.

Issues Involved:
1. Determination of limitation period for filing an appeal u/s 61 of the Insolvency and Bankruptcy Code, 2016.
2. Validity of forfeiture of Earnest Money Deposit (EMD) by the Liquidator.
3. Condonation of delay in filing the appeal.

Summary:

1. Determination of Limitation Period:
The primary issue was the determination of the limitation period for filing an appeal u/s 61 of the Insolvency and Bankruptcy Code, 2016. The Tribunal highlighted that the appeal should be filed within 30 days from the date of the judgment, as per (sub section 2) of Section 61. The judgment was pronounced on 17th November 2023, and the Appellant applied for the certified copy only on 21st December 2023, which was beyond the prescribed limitation period. The Tribunal emphasized that the limitation period starts from the date of pronouncement of the judgment and not from the date of receiving the certified copy.

2. Validity of Forfeiture of Earnest Money Deposit (EMD):
The Appellant contended that the Liquidator forfeited the EMD without providing clarification regarding the access to the auctioned property. The Tribunal noted that the auction was conducted on an "as is where is, as is what is, and without recourse basis," and the Liquidator's action of forfeiting the EMD due to non-payment of 25% of the sale consideration within the prescribed time was upheld by the National Company Law Tribunal, Chennai Bench.

3. Condonation of Delay:
The Appellant sought condonation of delay in filing the appeal, citing reasons such as seeking legal advice, being situated in Bengaluru, and cyclone conditions in Chennai. The Tribunal rejected these reasons, stating that the Appellant showed a lack of diligence. The Tribunal referred to the judgment in V. Nagarajan Vs SKS Ispat and Powers Ltd. and Ors., which clarified that the period for obtaining a certified copy can be excluded only if the application for the same is made within the statutory limitation period. The Tribunal also referenced the judgment in Sanjay Pandurang Kalad vs Vespara ICTL, which emphasized that the limitation period starts from the date of pronouncement of the judgment.

Conclusion:
The Tribunal concluded that the appeal was filed beyond the permissible period of limitation and rejected the application for condonation of delay. Consequently, the appeal was dismissed, and the forfeiture of the EMD by the Liquidator was upheld.

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