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TMI Blog2009 (9) TMI 575X X X X Extracts X X X X X X X X Extracts X X X X ..... ION NO. 843 OF 2009 IN COMPANY APPEAL (L) NO. 48 OF 2009 IN PETITION NOS. 44 AND 45 OF 2007 - - - Dated:- 17-9-2009 - S.J. KATHAWALLA, J. hailesh Shah, Ms. Devyani for the Applicant. Ravi Kadam, Chetan Kapadia, I.J. Nankani, Hujeba Khokhawala, Iqbal Chagla, Pratik Sakseria for the Respondent. JUDGMENT 1. By this Company Application, the Applicant/Appellant seeks condonation of delay of 105 days in lodging the Company Appeal filed under section 10F of the Companies Act, 1956. The question which arises for determination in this application is whether the provisions of section 5 of the Limitation Act, 1963 are applicable to an appeal filed under section 10F of the Companies Act, 1956. 2. Admittedly, a certified copy of the order passed by the Company Law Board dated 2-2-2009, was received by the applicant on 16-2-2009. However, the company petition was lodged on 31-7-2009 and the company application seeking condonation of delay in filing the appeal was lodged on 4-8-2009. 3. An affidavit in reply to the said Application is filed by the respondent No. 3 wherein it is contended by respondent No. 3 that in view of the proviso to section 10F, the Applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any Law Board. Any person aggrieved by any decision or order of the Company Law Board [made before the commencement of the Companies (Second Amendment) Act, 2002] may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Company Law Board to him on any question of law arising out of such order : Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days." According to Mr. Shah, the learned Advocate appearing for the applicant/appellant, though the words "but not thereafter" used in the proviso to section 34 of the Arbitration and Conciliation Act, 1996 can be read and interpreted to understand as expressly excluding the application of section 5 of the Limitation Act, 1963 to an application for setting aside an award under section 34 of the Arbitration and Conciliation Act, 1996, the same cannot be said about the words "not exceeding 60 days" used in the proviso to section 10F of the Companies Act, 1956 and therefore, section 5 of the Limitation Act, 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... word or a phrase in a statutory provision redundant or otiose can never be justified. 9. Mr. Kadam has further relied on a decision of the Hon ble Supreme Court in Consolidated Engg. Enterprises v. Principal Secretary, Irrigation Department [2008] 7 SCC 169, wherein the Hon ble Supreme Court has in paragraph 53 of its decision categorically held that the proviso to section 34(3) of the Arbitration and Conciliation Act, 1996, has the effect of excluding section 5 of the Limitation Act, 1963. In the said decision, the Hon ble Supreme Court after confirming that in the decision in the case of Popular Construction Co. ( supra ), a Division Bench of the Hon ble Supreme Court has held that section 5 of the Limitation Act is not applicable to an application challenging an award under section 34 of the Arbitration and Conciliation Act, 1996 has proceeded to hold that the said decision cannot be construed to mean a ruling that the provisions of section 14 of the Limitation Act are also not applicable to an application challenging an award under section 34 of the Arbitration and Conciliation Act, 1996. 10. Mr. Kadam has further relied on the decision of the Punjab and Haryana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... within sixty days (within three months from 1-5-2001) from the date of communication to him of such decision or order. Under the proviso to section 35, the Commissioner (Appeals) was empowered to allow the appellant to present an appeal within a further period of thirty days (three months from 11-5-2001) upon being satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the prescribed period of 60 days. The Hon ble Supreme Court after considering the language of section 35 of the Central Excise Act, 1944 held that the proviso to sub-section (1) of section 35 makes it crystal clear that the appellate authority had no power to allow the appeal to be presented beyond the period of 30 days. The Legislature intended the Appellate Authority to entertain the appeal by condoning delay only up to 30 days after the expiry of sixty days which is the normal period for preferring appeal. Therefore, there is a complete exclusion of section 5 of the Limitation Act and any condonation of delay would render a specific provision providing for limitation rather otiose. The appeal was, therefore, dismissed by the Hon ble Supreme Court. 13. Mr. Chagla has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Popular Construction Co. s case ( supra ), referring to the decision of its Constitution Bench in Vidya Charan Shukla v. Khupchand Baghel AIR 1964 SC 1099, has held : "This decision recognises that it is not essential for the special or local law to, in terms, exclude the provisions of the Limitation Act. It is sufficient if on a consideration of the language of its provisions relating to limitation, the intention to exclude can be necessarily implied. . . ." The Hon ble Supreme Court thereafter proceeded to hold that the words "but not thereafter" used in the proviso to sub-section (3) of section 34 of the Arbitration and Conciliation Act, 1996 is an express exclusion because of which section 29 would be made applicable and section 5 of the Limitation Act, 1963 will not be applicable to sub-section (3) of section 34 of the Arbitration and Conciliation Act, 1996. 17. The words used in the proviso to section 10F of the Companies Act, 1956 are "not exceeding 60 days" thereby clearly prescribing the time-limit of only 60 days, in addition to the initial period of 60 days allowed under section 10F of the Companies Act, 1956, to enable a party to file an appeal. The pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the powers which were so long exercised by the Courts, the Committee feel that the strength of the Company Law Board might be raised to nine so that the matters in relation to which the powers of the Court are proposed to be transferred to the Company Law Board might be disposed of expeditiously by one or more Benches formed by the Board. In order to enable the Company Law Board to discharge its quasi-judicial functions, it is also necessary to clothe it with the powers of a Civil Court to enforce the attendance of witnesses and production of documents, etc. and also to provide for punishment for its contempt." 21. Thereafter, based on the recommendations made by Sachar Committee, by the Companies (Amendment) Act, 1988 (with effect from 31-5-1991), the provisions of section 10E were once again amended and section 10F of the Companies Act, 1956 was inserted. Paragraphs 16.8 and 16.11 of the recommendations made by the Sachar Committee which are relevant in this behalf are reproduced hereunder : "There is also the strong feeling, expressed almost without any reservation, by all the organisations and individuals who had submitted their memorandum to the committee or ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to which powers have been vested in the Company Law Board. 24. The Companies Act being a special enactment, the Constitution of Company Law Board as a Special Tribunal is to ensure the matters in relation to certain provisions of the Companies Act, 1956, such as sections 397 and 398 are decided as expeditiously as possible without being bound by the strict rules of evidence or the provisions of the Code of Civil Procedure, 1908. 25. The Legislature has consciously restricted the right of appeal under section 10F of the Companies Act, 1956 only to questions of law so as to ensure that there is as far as possible an early finality to the issues and consequent redressal of grievances. All decisions on questions of fact as decided by the Company Law Board are final and conclusive. Therefore, any liberal construction of the discretion vested under the proviso to section 10F would render the provision otiose and defeat the purpose for the establishment of the Special Tribunal (being Company Law Board) for the speedy adjudication of the disputes. 26. The legislative intent as reflected from the amendments to the Companies Act, 1956 resulting in the constitution of the Compan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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