Dismissal of Appeal for Delay in Filing under Insolvency Code Section 61

The Tribunal dismissed the appeal seeking condonation of a 493-day delay in filing under Section 61 of the Insolvency and Bankruptcy Code, 2016. The Appellant's argument for excluding the moratorium period was rejected, emphasizing the protection of Corporate Debtors during the moratorium. Despite relying on precedent, the Tribunal clarified that the exclusion of the moratorium period applied to specific proceedings under a different act, not the present case. With the limited condonation provision, the delay could not be excused, leading to the dismissal of the application for condonation of delay and rejection of the memo of appeal without costs.

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Issues:
Delay in filing the appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016.

Analysis:
The appeal sought condonation of a 493-day delay in filing against the order passed by the Adjudicating Authority on 31st August, 2021. The Appellant argued that the moratorium period from 15.01.2020 to 23.12.2022 should be excluded under Section 60(6) of the Code. The Corporate Insolvency Resolution Process (CIRP) was initiated against a subsidiary of the Appellant during this period. The Appellant relied on judgments to support their claim for exclusion of the moratorium period from the limitation for filing the appeal.

The Adjudicating Authority's order directed the acceptance of Respondent No.1's claim, prompting the appeal under Section 61 of the Code. The Appellant contended that the moratorium period should be excluded from the limitation period for filing the appeal. However, the Tribunal noted that the benefit of Section 60(6) of the Code, which excludes the moratorium period from limitation, was not applicable in this case. The Tribunal highlighted the purpose of Section 60(6) to protect Corporate Debtors and those initiating actions against them during the moratorium.

The Tribunal referenced the judgment of the Hon'ble Supreme Court in 'New Delhi Municipal Council vs. Minosha India Limited' to emphasize the exclusion of the moratorium period for Corporate Debtors. However, the Tribunal clarified that the Supreme Court's judgment was specific to proceedings under the Arbitration and Conciliation Act, 1996, not applicable to the present case of appealing under Section 61 of the Code. Despite the Appellant's arguments, the Tribunal could not condone the 493-day delay in filing the appeal under Section 61(1) of the Code due to the limited 15-day condonation provision under Section 61(2). Consequently, the application for condonation of delay was dismissed, and the memo of appeal was rejected with no order as to costs.

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