2021 (12) TMI 83 - AT - Insolvency and Bankruptcy

Appeals dismissed for exceeding time limit, emphasizing statutory timelines under I&B Code. Rule 50 NCLT Rules, 2016, not applicable.

The Tribunal dismissed all Appeals as barred by time, emphasizing adherence to statutory timelines under the I&B Code. The Appellant's reliance on ... Maintainability of appeal filed belatedly - whether the Appeals filed by the Appellant are within time or they are barred by limitation? - HELD THAT:- The question which has been raised before us is that since free of cost copy as required by Rule 50 has not been received by the Appellant, the period of limitation shall not begin to run and the Appeals filed by the Appellant on 20.09.2021 are well within time. When we read Section 61 of the ‘I&B Code’ with Rule 50 of the NCLT Rules, it cannot be said that limitation in filing of an Appeal under Section 61 shall not begin to run unless free of cost copy is sent by Registry and received by a party. The limitation to file Appeal under Section 61 cannot be treated to be under suspension till free of cost copy is received by party as enjoined by Rule 50. Any such interpretation shall not dwell with the statutory scheme. The ‘I&B Code’ has been enacted to speed up Insolvency Resolution Process and there is a timeline fixed for different steps filing Appeal within 30 days to the Appellate Tribunal is also part of the same thread of timeline which run through different provisions of the ‘I&B Code’. Rule 50 is contained in Chapter IV which deals with the procedure and Rule 50 is a part of procedural law which oblige the Registry to send free of cost copy. However, the scheme of limitation for filing Appeal as delineated by Section 61 does not give any scope to the submission that limitation to file an Appeal under Section 61 shall not begin till free of cost copy under Rule 50 is received by a party. The provisions of the Limitation Act are applicable to the ‘I&B Code’ proceedings which is well settled and is no longer debatable after insertion of Section 238A in ‘I&B Code’. Section 12 of the Limitation Act provides for period which can be excluded in period of limitation. In the present case, the case of the Appellant is that he applied certified copy of the order twice firstly on 21.01.2019 and secondly on 29.07.2021. Applying the ratio of the judgment of the “Sagufa Ahmed” [2020 (9) TMI 713 - SUPREME COURT], in the present case, at best Appellant can claim that period of limitation did not start running till he applied for certified copy of the order i.e. till 21.01.2019. The Appeals have been filed on the strength of certified copy of the judgment which was applied on 29.07.2021 which certified copy of the Application is claimed by the Appellant after more than three years of the delivery of the judgment whereas in Sagufa Ahmed’s case certified copy of the judgment was applied within 27 days from the delivery of judgment. The Appeals have been filed after expiry of limitation. The Appeals are barred by time and cannot be entertained - appeal dismissed. Issues Involved:1. Whether the Appeals filed by the Appellant are within time or barred by limitation.2. Whether the Appellant is entitled to the benefit of the Supreme Court's judgment in Suo Motu Writ Petition (Civil) No. 03/2020.3. Interpretation and application of Rule 50 of the NCLT Rules, 2016 regarding the provision of free certified copies of orders.Detailed Analysis:1. Whether the Appeals filed by the Appellant are within time or barred by limitation:The primary issue is whether the Appeals filed by the Appellant on 20.09.2021 are within the prescribed time limit as per Section 61 of the Insolvency and Bankruptcy Code, 2016 (I&B Code). The NCLT delivered its judgment on 20.07.2018, and the Appellant applied for a certified copy on 27.07.2021, receiving it on 29.07.2021. According to Section 61(2) of the I&B Code, an appeal must be filed within thirty days of the order, with a possible extension of fifteen days if sufficient cause is shown. The Appellant argued that the limitation period should start from the date of receiving the certified copy. However, the Tribunal noted that the Appellant had knowledge of the order in December 2018 and initially applied for a certified copy on 21.01.2019, but failed to explain the delay in applying for a second certified copy on 27.07.2021. The Tribunal concluded that the Appeals were filed beyond the permissible time limit and thus were barred by limitation.2. Whether the Appellant is entitled to the benefit of the Supreme Court's judgment in Suo Motu Writ Petition (Civil) No. 03/2020:The Appellant relied on the Supreme Court's order dated 23.09.2021 in Suo Motu Writ Petition (Civil) No. 03/2020, which excluded the period from 15.03.2020 to 02.10.2021 from the limitation period due to the COVID-19 pandemic. However, the Tribunal observed that the impugned order was passed on 20.07.2018, well before the pandemic period. Therefore, excluding the period from 15.03.2020 to 02.10.2021 did not aid the Appellant, as the delay from 20.07.2018 to 14.03.2020 remained unexplained. Consequently, the Tribunal held that the Supreme Court's order did not benefit the Appellant in this case.3. Interpretation and application of Rule 50 of the NCLT Rules, 2016 regarding the provision of free certified copies of orders:The Appellant argued that the limitation period should not start until a free certified copy of the order, as required by Rule 50 of the NCLT Rules, 2016, was provided. Rule 50 mandates the Registry to send a certified copy of the final order free of cost to the concerned parties. However, the Tribunal held that the limitation period under Section 61 of the I&B Code does not depend on the receipt of a free certified copy. The Tribunal emphasized that the I&B Code aims to expedite the insolvency resolution process, and delaying the start of the limitation period until the receipt of a free copy would undermine this objective. The Tribunal referred to the Supreme Court's judgment in 'Mobilox Innovations Private Limited vs. Kirusa Software Private Limited,' which underscores the importance of adhering to the statutory timelines. Additionally, the Tribunal cited the Supreme Court's decision in 'V Nagarajan vs. SKS Ispat and Power Ltd. & Ors.,' which clarified that the limitation period for filing an appeal under the I&B Code starts from the pronouncement of the order, not from the receipt of a free certified copy. The Tribunal concluded that Rule 50 is procedural and does not affect the statutory limitation period for filing appeals.Conclusion:The Tribunal dismissed all the Appeals as barred by time, emphasizing the importance of adhering to the statutory timelines under the I&B Code and rejecting the Appellant's reliance on Rule 50 of the NCLT Rules, 2016, and the Supreme Court's Suo Motu Writ Petition (Civil) No. 03/2020.