Supreme Court allows appeal in favor of appellant under Insolvency & Bankruptcy Code

The Supreme Court found in favor of the appellant in an appeal under Section 62 of the Insolvency and Bankruptcy Code. The Court held that the appeal was filed within the prescribed limitation period, considering the exclusion of time taken to obtain a certified copy of the order. The Court agreed that the time for obtaining the certified copy should be excluded, as per Section 12(2) of the Limitation Act. Additionally, the Court highlighted the need for modernization and adaptation to technology in administrative orders and rules for e-filing and physical filing, encouraging e-filing to streamline processes. The appeal was allowed, and the NCLAT's order was set aside for further consideration on merits.

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Issues Involved:
1. Limitation period for filing an appeal under Section 62 of the Insolvency and Bankruptcy Code 2016 (IBC).
2. Exclusion of time for obtaining a certified copy of the order in computing the limitation period.
3. Administrative orders and rules regarding e-filing and physical filing of appeals.

Summary:

Issue 1: Limitation Period for Filing an Appeal under IBC
The appeal arises under Section 62 of the IBC from a judgment of the NCLAT, which dismissed the appeal against the NCLT order on the ground of limitation. The appellant argued that the appeal was filed within the prescribed period of limitation, considering the exclusion of time taken to obtain a certified copy of the order. The NCLAT held that the appeal was lodged on the 46th day after the NCLT order, exceeding the permissible limit of 45 days under Section 61 of the IBC. The Supreme Court found that the appeal was actually lodged on the 45th day, thus within the outer limit.

Issue 2: Exclusion of Time for Obtaining a Certified Copy
The appellant contended that the period from 5 September 2022 (when the application for a certified copy was filed) to 15 September 2022 (when the copy was received) should be excluded. The Supreme Court agreed, referencing Section 12(2) of the Limitation Act 1963, which allows the exclusion of time requisite for obtaining a copy of the order. The Court noted that the appellant had exercised due diligence by applying for a certified copy within the prescribed period.

Issue 3: Administrative Orders and Rules on E-filing and Physical Filing
The Supreme Court examined the administrative orders and rules regarding the computation of limitation for e-filing and physical filing. It noted the lack of clarity and the flip-flops in NCLAT's administrative guidance on whether limitation would commence from the date of e-filing or from the presentation of the appeal at the filing counter. The Court emphasized the need for the judiciary and tribunals to modernize and adapt to technology, encouraging e-filing to reduce duplication of effort and environmental impact.

Conclusion:
The Supreme Court concluded that the NCLAT erred in dismissing the appeal on the ground of limitation. The explanation for condoning the delay of 5 days was sufficient. The appeal was allowed, and the NCLAT's order was set aside. The appeal was restored to the file of the NCLAT for disposal on merits. The Court also suggested that the Union Government should re-evaluate rules to encourage e-filing across tribunals.

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