Limitation under insolvency law and SEZ exit estimates: time-barred appeal rejected, resolution plan upheld.

An appeal under the Insolvency and Bankruptcy Code, 2016 is subject to a special limitation period of 30 days, extendable by 15 days only on sufficient cause; the 45-day outer limit cannot be crossed, so the appeal was time-barred and not entertainable. On merits, a resolution plan could validly reserve an estimated amount for SEZ de-notification and related duties or penalties because the actual liability remained for the competent authority to assess at exit. That estimate did not encroach upon the Development Commissioner's jurisdiction or conflict with the SEZ Act and Rules, so the challenge to the approved plan failed and the plan remained undisturbed.

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Issues: (i) Whether the appeal was barred by limitation under the Insolvency and Bankruptcy Code, 2016. (ii) Whether the approved resolution plan, to the extent it set aside an estimated amount for de-notification from the Special Economic Zone and sought waiver of additional interest or penalty, was contrary to the Special Economic Zones Act, 2005 and the Special Economic Zones Rules, 2006 or amounted to encroachment upon the Development Commissioner's jurisdiction.

Issue (i): Whether the appeal was barred by limitation under the Insolvency and Bankruptcy Code, 2016.

Analysis: The appellate remedy under Section 61 is governed by a special limitation scheme of 30 days, extendable by a further 15 days only on sufficient cause. The outer limit of 45 days cannot be crossed. On the facts, the appellant had knowledge of the impugned order well before the date asserted by it, and the appeal was filed beyond the maximum permissible period.

Conclusion: The appeal was barred by limitation and could not be entertained.

Issue (ii): Whether the approved resolution plan, to the extent it set aside an estimated amount for de-notification from the Special Economic Zone and sought waiver of additional interest or penalty, was contrary to the Special Economic Zones Act, 2005 and the Special Economic Zones Rules, 2006 or amounted to encroachment upon the Development Commissioner's jurisdiction.

Analysis: Section 51 of the Special Economic Zones Act, 2005 gives the SEZ regime overriding effect, while Rule 74 of the Special Economic Zones Rules, 2006 makes exit from an SEZ subject to payment of applicable duties and any penalty that may be imposed. The amount kept aside in the plan was only an estimate, not a crystallised debt, and the actual quantification remained for the competent authority at the time of exit. The resolution plan did not usurp the Development Commissioner's powers and was consistent with the insolvency framework, under which an approved plan binds stakeholders once it satisfies the statutory requirements.

Conclusion: The challenge to the resolution plan failed on merits.

Final Conclusion: The appeal failed both on limitation and on merits, and the approved resolution plan was left undisturbed.

Ratio Decidendi: A resolution plan may validly provide for an estimated amount toward statutory duties or penalties arising on SEZ exit where the actual liability remains to be assessed by the competent authority, and an appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016 cannot be entertained beyond the maximum outer limit of 45 days.

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