2022 (1) TMI 217 - AT - Insolvency and Bankruptcy

Approval of Resolution Plan - Appeal filed within time or not - submission of the Appellant is that the Appellant was provided free of cost copy of the order only on 05.02.2021 hence period of limitation shall start running only from 05.02.2021 - Section 61 of the Insolvency and Bankruptcy Code, 2016 - Whether limitation for filing the Appeal for the Appellant against the order dated 11.11.2019 passed by the Adjudicating Authority shall commence only w.e.f. 05.02.2021 when he has been provided with certified copy of the judgment (free of cost)? - HELD THAT - When the Appellant himself stated before the Bombay High Court that they intend to challenge the order dated 11.11.2019 there was no occasion for him to wait till 05.02.2021 for obtaining a certified free of cost copy and file an Appeal. He has disclosed their intention to file an Appeal on 03.12.2019. He cannot be allowed to contend that since he received certified copy (free of cost) on 05.02.2021, his Appeal is within time. Whether the Appellant is entitled for the benefit of judgment of the Hon ble Supreme Court in Suo Moto Writ Petition No. 3 of 2020 2020 (5) TMI 418 - SC ORDER ? - HELD THAT - The present is a case where order was passed on 11.11.2019 and 30 days period expired on 10.12.2019. The order of Suo Motu Writ Petition was relied. The Hon ble Supreme Court in the aforesaid order directed for extension of limitation from 15.03.2020 due to the COVID-19 Pandemic. The limitation for filing the Appeal of the Appellant long expired much before 15.03.2020, hence, the benefit of order of the Hon ble Supreme Court dated 23.03.2020 in Suo Motu Writ Petition cannot be availed by the Appellant. Whether on account of Appellant prosecuting its claim which Writ Petition is still pending, the Appellant is entitled for the benefit of Section 14(2) of the Limitation Act, 1963 for presenting the present Appeal? - HELD THAT - The benefit of Section 14(2) can be claimed of the period during which bonafide proceeding is prosecuted in a Court which due to defect of jurisdiction or other cause of a like nature, is unable to entertain it. The present is not a case where Bombay High Court was unable to entertain the Writ Petition which was filed and pending in the Bombay High Court. Writ Petition was filed under Article 226 of the Constitution of Indian and it cannot be accepted that High Court has no jurisdiction to entertain the Writ Petition. Thus, the benefit of Section 14(2) as claimed by the Appellant cannot be extended in the present case. This Appeal is clearly barred by time and no case has been made out to claim benefit of Sections 5 and 14(2) of the Limitation Act to the Appellant - Appeal dismissed.

Summary

Issues Involved:
1. Commencement of limitation for filing the appeal.
2. Entitlement to the benefit of the Supreme Court's judgment in Suo Motu Writ Petition No. 3 of 2020.
3. Entitlement to the benefit of Section 14(2) of the Limitation Act, 1963.

Issue-wise Detailed Analysis:

Issue No. (1): Commencement of Limitation for Filing the Appeal

The appellant argued that the limitation period for filing the appeal should commence from 05.02.2021, the date when a certified copy of the judgment was provided free of cost. The appellant relied on the judgments in "Mahendra Trading Company and Ors. vs. Hindustan Controls and Equipment Pvt. Ltd." and "Shaji Purushothaman vs. S. Rajendran & Ors." and the Supreme Court's judgment in "Sagufa Ahmed and Ors. vs. Upper Assam Polywood Products Pvt. Ltd. & Ors." However, the Tribunal noted that in "V. Nagarajan v. SKS Ispat and Power Ltd. & Ors.," the Supreme Court held that the limitation period under Section 61 of the IBC begins from the date of pronouncement of the judgment, and a party is expected to apply for a certified copy upon pronouncement. The Tribunal emphasized that the appellant was aware of the judgment by 03.12.2019 and had expressed an intention to challenge it. Therefore, the appellant could not claim that the limitation period commenced from the date of receiving the certified copy on 05.02.2021. The appeal, filed on 17.06.2021, was deemed barred by time.

Issue No. (2): Entitlement to the Benefit of the Supreme Court's Judgment in Suo Motu Writ Petition No. 3 of 2020

The appellant sought the benefit of the Supreme Court's order in Suo Motu Writ Petition No. 3 of 2020, which extended the limitation period due to the COVID-19 pandemic. However, the Tribunal noted that the limitation period for filing the appeal had expired on 10.12.2019, well before the Supreme Court's order on 23.03.2020. Consequently, the appellant could not avail the benefit of the extended limitation period.

Issue No. (3): Entitlement to the Benefit of Section 14(2) of the Limitation Act, 1963

The appellant claimed the benefit of Section 14(2) of the Limitation Act, 1963, arguing that the time spent prosecuting the writ petition in the Bombay High Court should be excluded. The Tribunal acknowledged that the benefit under Section 14(2) could be claimed by both petitioners and respondents. However, it emphasized that the pre-condition for applicability of Section 14(2) is that the earlier proceeding must have been prosecuted in a court that was unable to entertain it due to a defect of jurisdiction or a similar cause. In this case, the writ petition before the Bombay High Court did not suffer from any defect of jurisdiction. Therefore, the appellant could not claim the benefit of Section 14(2). The Tribunal distinguished the present case from "Sesh Nath Singh and Ors. vs. Baidyabati Sheoraphuli Co-operative Bank Ltd. & Ors.," where the benefit under Section 14(2) was granted due to a prima facie defect of jurisdiction in the SARFAESI proceedings.

Conclusion:

The Tribunal concluded that the appeal against the judgment dated 11.11.2019, filed on 17.06.2021, was clearly barred by time. The appellant failed to make a case for the benefit of Sections 5 and 14(2) of the Limitation Act. Consequently, the appeal was dismissed as barred by time.