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TMI Blog2024 (8) TMI 524X X X X Extracts X X X X X X X X Extracts X X X X ..... Professional ("RP") in the CIRP. On 20.08.2019, the Resolution Plan was approved by the Committee of Creditors ("CoC") and IA No.576/2019 was filed by the RP for approval of the Resolution Plan. (ii) An IA No.2121/2023 was filed by Respondent No.1 - Srei Equipment Finance Limited having vote share of 53.45% before the Adjudicating Authority, praying for removal of the Appellant as RP. On the IA No. 2121/2023, notices were issued to the Appellant and Appellant was asked to file the reply. The Appellant could not file reply to the IA. The Adjudicating Authority considered the IA No.2121/2023 and by order dated 07.06.2023 directed for removal of the Appellant as RP. (iii) The Appellant after order dated 07.06.2023, filed an Application before the Adjudicating Authority being IA No.3216/2023 under Rule 49 of the National Company Law Tribunal Rules, 2016 ("NCLT Rules") for recall of the order dated 07.06.2023, which Application came to be heard and rejected by the Adjudicating Authority vide order dated 12.12.2023. (iv) The Appellant aggrieved by the order dated 12.12.2023, filed an Appeal being Company Appeal (AT) (Insolvency) No.1690 of 2023, which Appeal was heard and dismissed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excluded by extending the benefit of Section 14 of the Limitation Act. In event, the exclusion is not allowed under Section 14, the delay in filing of the Appeal being 209 days is uncondonable. Our jurisdiction to condone the delay limited to only 15 days, after the expiry of limitation. Whether the Appellant is entitled for benefit of Section 14 of the Limitation Act is the question to be answered. 7. Section 14 of the Limitation Act provides as follows: "Section 14. Exclusion of time of proceeding bona fide in court without jurisdiction (1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. (2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a court of fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction to a litigant against the bar of limitation when he institutes a proceeding which by reason of some technical defect cannot be decided on merits and is dismissed. While considering the provisions of Section 14 of the Limitation Act, proper approach will have to be adopted and the provisions will have to be interpreted so as to advance the cause of justice rather than abort the proceedings. It will be well to bear in mind that an element of mistake is inherent in the invocation of Section 14. In fact, the section is intended to provide relief against the bar of limitation in cases of mistaken remedy or selection of a wrong forum. On reading Section 14 of the Act it becomes clear that the legislature has enacted the said section to exempt a certain period covered by a bona fide litigious activity. Upon the words used in the section, it is not possible to sustain the interpretation that the principle underlying the said section, namely, that the bar of limitation should not affect a person honestly doing his best to get his case tried on merits but failing because the court is unable to give him such a trial, would not be applicable to an application filed under Section 34 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard the IA No.3216/2023 and concluded that there was no sufficient cause for exercising jurisdiction under Rule 49 of the NCLT Rules for recalling order dated 07.06.2023. In paragraphs 23 and 24 of the judgment dated 12.12.2023, rejecting the IA No.3216/2023, following was held by the Adjudicating Authority: "23. According to our considered view, the only cause shown by the Applicant for non-appearance on 07.06.2023 is that the Applicant noted a wrong date in the diary. It is not denied that the the Applicant's counsel appeared and was present on 12.05.2023. 24. We do not consider it to be a sufficient cause for exercising the power under the provisions of Rule 49 of the NCLT Rules, 2016 for recalling of the order dated 07.06.2023. We further may note that on 07.06.2023 this Adjudicating Authority has appointed Mr. Ranjan Chakraborti, as a new RP in place of Mr. Srigopal Choudhary, RP." 11. Further, the Appellant has challenged the order dated 12.12.2023 in this Tribunal and this Tribunal vide its judgment dated 03.01.2024 has also affirmed the judgment of the Adjudicating Authority. The learned Counsel for the Respondent in the reply has also brought on the record the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant has also placed reliance on the judgment of the Hon'ble Supreme Court in N. Mohan vs. R. Madhu - Civil Appeal No.8898 of 2019I, in which case, after dismissal of Application under Order IX Rule 13 CPC, the ex-parte decree was challenged upto the Hon'ble Supreme Court and belated appeal was filed under Section 96, sub-section (2) by the defendant, in which Application, condonation of delay under Section 5 of the Limitation Act was rejected. In the facts of the case, delay in filing the Appeal was condoned. In paragraph 18, 19 and 20, the Hon'ble Supreme Court passed an order for condonation of delay, subject to deposit of Rs.20 lakhs before the Trial Court. Paragraphs 18, 19 and 20 of the judgment is as follows: "18. Thereafter, the appellant has preferred the first appeal with the application to condone the delay of 546 days in filing the first appeal. As pointed out earlier, there was a delay of 276 days in filing the application to set aside the ex-parte decree. Pursuing the proceedings in the application filed under Order IX Rule 13 CPC has caused further delay of 270 days. Thus, there has been a total delay of about 546 days in filing the first appeal. In the application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Madras High Court in CMP(MD) No.6566 of 2017 in AS(MD) SR No. 27805 of 2017 is set aside and this appeal is allowed. The delay in filing the appeal is condoned. The appeal shall be taken on file and the High Court shall proceed with the same in accordance with law. We make it clear that we have not expressed any opinion on the merits of the matter. It is also made clear that the criminal complaints filed under Section 138 of NI Act be proceeded on its own merits without being influenced by any of the views expressed by this Court or by the High Court." 16. The Hon'ble Supreme Court in the above case was considering Application filed under Section 5 of the Limitation Act for condonation of delay in filing of the Appeal. The said case was not a case where benefit of Section 14 of the Limitations Act was sought or accepted. Thus, the case is clearly distinguishable. More so, the Hon'ble Supreme Court took into notice the bonafide of the Appellant, where he deposited Rs.25 lakhs in compliance of the order of the Hon'ble Supreme Court, which was permitted to be withdrawn by the Plaintiff. The reasons given by the Hon'ble Supreme Court in paragraph 19 and 20, clearly indicate that o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be applied. In Para 35, Hon'ble Supreme Court has observed that civil proceedings are of many kinds and need not be confined to suits, appeals and applications which are made only in courts stricto sensu. Following has been laid down in Para 35: "35. This judgment is in line with a large number of authorities which have held that Section 14 should be liberally construed to advance the cause of justice - see: Shakti Tubes Ltd. v. State of Bihar, (2009) 1 SCC 786 and the judgments cited therein. Obviously, the context of Section 14 would require that the term "court" be liberally construed to include within it quasi - judicial Tribunals as well. This is for the very good reason that the principle of Section 14 is that whenever a person bonafide prosecutes with due diligence another proceeding which proves to be abortive because it is without jurisdiction, or otherwise no decision could be rendered on merits, the time taken in such proceeding ought to be excluded as otherwise the person who has approached the Court in such proceeding would be penalized for no fault of his own. This judgment does not further the case of Shri Viswanathan in any way. The question that has to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty. It has been held, that the equity underlying Section 14 should be applied to its fullest extent and time taken diligently pursuing a remedy, in a wrong court, should be excluded. It could thus be seen, that this Court has in unequivocal terms held, that when a litigant bona fide under a mistake litigates before a wrong forum, he would be entitled for exclusion of the period, during which he was bona fide prosecuting such a wrong remedy. Though strictly, the provisions of Section 14 of the Limitation Act would not be applicable to the proceedings before a quasi-judicial Tribunal, however, the principles underlying the same would be applicable i.e. the proper approach will have to be of advancing the cause of justice, rather than to abort the proceedings." "78. In the present case, perusal of the writ petition would reveal, that it was the specific case of KIAL, that its application, objecting to the application of RP for approval of the resolution plan was heard by a Member (Judicial), whereas, the final orders were passed by a Bench consisting of Member (Judicial) and Member (Technical). It has specifically averred, that though an alternate remedy was available to it, it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant by I.A. No. 2623 of 2021 was prosecuted on merits and rejected. The condition as required to be fulfilled under Section 14(1) cannot be said to be fulfilled. We may in this context refer to two judgments of High Courts. In "AIR 1977 Cal 443, Corporation of Calcutta vs. Pulin Chandra Daw & Ors", the question of extending benefit of Section 14 of the Limitation Act arose. It was held by the Hon'ble High Court of Calcutta that when the prior suit being adjudicated upon and disposed of on merits, the conditions were not fulfilled. In Para 14 following has been laid down: "14. On a careful consideration of the respective contention of the parties I find the defendant's case to be of more sub-stance. In my view the claim of the plaintiff in the prior suit having been adjudicated upon and disposed of on merits, it can hardly be said that the previous suit filed in 1952 was altogether misconceived, or that the Courts were under any infirmity or there was any defect of jurisdiction or any defect of like nature which prevented the Courts from entertaining the earlier suit." 20. The judgment of the Hon'ble Supreme Court relied by the Appellant in Consolidated Engineering Enter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court of India in Civil Appeal No.3169 of 2019 after the 'Impugned Order' dated 25.6.2019 passed by the 'Adjudicating Authority', instead of preferring an 'Appeal' before this 'Tribunal' and later filing of the 'Review Proceeding' before the 'Adjudicating Authority', pursuant to the liberty granted by the Hon'ble Supreme Court as per order dated 29.7.2019 are bonafide, of course based on act of prudence or reasonable person in prosecuting the concerned proceeding with reasonable due diligence. Suffice it for this 'Tribunal' to point out that the 'time spent' in prosecuting the legal remedy by the Petitioner/Appellant/Bank is required to be excluded while computing the period of limitation as envisaged under section 61(2) of the 'Insolvency & Bankruptcy Code, 2016, in the considered opinion of this 'Tribunal'. In any event, the Petitioner/Appellant/Bank cannot be attributed with 'Lack of Bonafides' in resorting to the legal proceedings and time spent in this regard. Therefore, this 'Tribunal' by adopting a practical, purposeful, meaningful, a rational approach and by taking a pragmatic view of the matter in a lenient and liberal manner condones the delay of 193 days in furtherance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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