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TMI Blog2023 (5) TMI 901X X X X Extracts X X X X X X X X Extracts X X X X ..... d order before preferring an appeal. The NCLAT held that even according to the version of the appellants, the period of 30 days would end on 4 October 2022 while the appeal was filed on 10 October 2022. It noted that 10 days (from 26 August 2022 to 4 September 2022) were spent prior to the application for a certified copy and between 15 September 2022 and 4 October 2022 another period of 20 days elapsed - the NCLAT concluded that the appeal was barred by limitation on the ground that it was instituted on the 46th day following the order of the NCLT, exceeding the outer limit of 45 days that was permissible under Section 61 of the IBC. The dispute in the appeal arises over the period of limitation applicable for filing an appeal against an order of the NCLT under the IBC. The IBC is a complete code. Section 238 of the IBC provides that the Code shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law. Relevant provisions of the IBC, Limitation Act 1963, NCLAT Rules 2016 and administrative orders are extracted below and are referred to, in turn. It is ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Insolvency and Bankruptcy Code 2016 [ IBC ] from a judgment dated 9 January 2023 of the National Company Law Appellate Tribunal [ NCLAT ] . The NCLAT dismissed the appeal against the order of the National Company Law Tribunal [ NCLT ] on the ground of limitation. 3. The appellant instituted an application under Section 7 of the IBC in June 2021 seeking the initiation of the Corporate Insolvency Resolution Process against the respondent. The application was dismissed by the NCLT by an order dated 26 August 2022. On 2 September 2022, the appellant filed an application for obtaining a certified copy of the order which was pronounced by the NCLT. The application was received by the Registry of NCLT on 5 September 2022. On 15 September 2022, the order was uploaded on the website of the NCLT and a certified copy was provided to the appellant on the same day. The appellant lodged an appeal before the NCLAT on 10 October 2022 in the e-filing mode along with an Interlocutory Application [ IA ] seeking condonation of delay of five days. A physical copy of the appeal was filed on 31 October 2022. 4. The appellant submitted that the appeal had been filed within the period of l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... done the delay , in the teeth of the mandate, prescribed under the I B Code, 2016, as opined by this Tribunal . (emphasis supplied) 6. The NCLAT held that even according to the version of the appellants, the period of 30 days would end on 4 October 2022 while the appeal was filed on 10 October 2022. It noted that 10 days (from 26 August 2022 to 4 September 2022) were spent prior to the application for a certified copy and between 15 September 2022 and 4 October 2022 another period of 20 days elapsed. 7. The NCLAT concluded that the appeal was barred by limitation on the ground that it was instituted on the 46th day following the order of the NCLT, exceeding the outer limit of 45 days that was permissible under Section 61 of the IBC. 8. The appellant questions the order of the NCLAT on limitation. 9. The following submissions have been urged by Mr Bhanu Gupta, counsel appearing on behalf of the appellant: i. The NCLAT ought to have excluded the period from 5 September 2022, when an application for obtaining a certified copy was filed till 15 September 2022, when the certified copy was received, while computing the period of limitation; ii. The NC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being in force or any instrument having effect by virtue of any such law. Relevant provisions of the IBC, Limitation Act 1963, NCLAT Rules 2016 and administrative orders are extracted below and are referred to, in turn. 12. Section 61(1) of the IBC stipulates that notwithstanding anything to the contrary contained in the Companies Act 2013, any person aggrieved by the order of the adjudicating authority under this Part may prefer an appeal to NCLAT. Sub-Section (2) of Section 61 provides for a period of limitation in the following terms: 61. Appeals and Appellate Authority (1) Notwithstanding anything to the contrary contained under the Companies Act, 2013, any person aggrieved by the order of the Adjudicating Authority under this part may prefer an appeal to the National Company Law Appellate Tribunal. (2) Every appeal under sub-section (1) shall be filed within thirty days before the National Company Law Appellate Tribunal: Provided that the National Company Law Appellate Tribunal may allow an appeal to be filed after the expiry of the said period of thirty days if it is satisfied that there was sufficient cause for not filing the appeal but such pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the prescribed form with stipulated fee at the filing counter and non-compliance of this may constitute a valid ground to refuse to entertain the same. (2) Every appeal shall be accompanied by a certified copy of (3) All documents filed in the Appellate Tribunal shall be accompanied by an index in triplicate containing their details and the amount of fee paid thereon. (4) Sufficient number of copies of the appeal or petition or application shall also be filed for service on the opposite party as prescribed. (5) In the pending matters, all other applications shall be presented after serving copies thereof in advance on the opposite side or his advocate or authorised representative. (6) The processing fee prescribed by the rules, with required number of envelopes of sufficient size and notice forms as prescribed shall be filled along with memorandum of appeal. 16. In terms of Rule 103, the Appellate Tribunal may allow the filing of an appeal or proceedings through electronic mode. Rule 103 provides that: 103. Filling through electronic media The Appellate Tribunal may allow filing of appeal or proceedings through electronic mode such a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omputed from the date of presentation of Appeal as per Rule 22 of the NCLAT Rules, 2016. (2) The requirement of filing Appeals by electronic mode shall continue along with mandatory filing of the Appeals as per Rule 22 of the NCLAT Rules, 2016. (3) This order will be effective with effect from 1st November, 2022. All concerned shall ensure that Appeals are presented as per Rule 22 of the NCLAT Rules, 2016 within the period of limitation at the filing counter. 19. The above order dated 21 October 2022 indicates that the SOPs and directions which were issued by the NCLAT did not contain any provision for the computation of limitation, more specifically on whether limitation has to be computed with reference to the date of e-filing or from the date on which the appeal is presented before the NCLAT, in terms of Rule 22. Hence, in exercise of the power conferred by Rule 104, it was notified that the period of limitation would be computed with reference to the date of the presentation of the appeal in terms of Rule 22. Moreover, the requirement of filing appeals by the electronic mode was directed to continue together with the mandatory filing of appeals un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , using the e-filing portal. The subsequent order dated 21 October 2022 acknowledges that there was an absence of clarity in regard to the period with reference to which limitation would commence. Hence, the order purported to state that the period of limitation shall be computed from the date of the presentation of an appeal under Rule 22. Significantly, the above order was to be effective from 1 November 2022. In the present case, admittedly, the appeal was e-filed on 10 October 2022 and even a physical copy was lodged on 31 October 2022 prior to the date on which the order of the Registrar dated 21 October 2022 was to come into effect. The order dated 21 October 2022 was subsequently withdrawn on 24 December 2022. The order dated 24 December 2022 now clarifies that limitation would be computed with effect from the date of e-filing but a physical copy would have to be filed within seven days of e-filing. 23. In the present case, the order was pronounced by the NCLT on 26 August 2022. Rule 3 of the NCLAT Rules 2016 stipulates that the date from which the period of limitation has to be reckoned (i.e., the date of the pronouncement of the order) would have to be excluded. Hence, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plained of was pronounced and the time requisite for obtaining a copy of the decree, sentence or order appealed from or sought to be revised or reviewed shall be excluded. (3) . (4) . Explanation . In computing under this section the time requisite for obtaining a copy of a decree or an order, any time taken by the court to prepare the decree or order before an application for a copy thereof is made shall not be excluded. 27. In V Nagarajan (supra), a three judge Bench of this Court observed that Rule 22(2) of the NCLAT Rules 2016 mandates that an appeal has to be filed with a certified copy of the impugned order. The Court held that limitation commences once the order was pronounced and the time taken by the court to provide the appellant with a certified copy would be excluded, as clarified in Section 12(2) of the Limitation Act 1963, if the appellant had applied for a certified copy within the prescribed period of limitation under Section 61(2) of the IBC. In the facts of the case, this Court held that the appeal was barred by limitation as the appellant demonstrated no effort to secure a certified copy and only relied on the date of the uploading o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 2022, within the period of limitation of 30 days specified in Section 61(2). This aspect lies in contrast to the facts as they obtained before this Court in the judgment in V Nagarajan (supra) where even the application for obtaining the certified copy was not filed. In the present case, the appellant exercised due diligence and applied for a certified copy upon pronouncement of the order in terms of Rule 22(2) of the NCLT Rules 2016. The certified copy was provided to the appellant on 15 September 2022. Hence, the period of 10 days between 5 September 2022 and 15 September 2022 taken by the court to provide a certified copy of the order ought to be excluded when determining the period of limitation under Section 61(2) of the IBC. 29. In view of the above discussion, we have come to the conclusion that the NCLAT was in error in dismissing the appeal on the ground of limitation. The explanation which was advanced by the appellant for condoning the period of 5 days (beyond the period of 30 days stipulated for the filing of an appeal) was, in our view, sufficient and the delay should have been condoned within the four corners of the statute. 30. Before concluding, we cannot b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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