Landowners' appeal dismissed for filing beyond time limit after intervention rejection under Section 61 IBC 2016

NCLAT Chennai dismissed appeal filed beyond prescribed time limit by landowners whose intervention was rejected by NCLT. The tribunal held that appellants, who leased land to corporate debtor under liquidation, could not be considered "aggrieved persons" under Section 61 of IBC 2016 as they were conscious of proceedings and had intervened but were ultimately rejected. Since appellants failed to challenge orders rejecting their intervention applications and were not formal parties to proceedings, their appeal was not maintainable despite being heard as additional respondents.

---

---

Issues:
1. Timeliness of filing the Company Appeal.
2. Interpretation of the term "Aggrieved Person" under Section 61 of the I & B Code, 2016.
3. Disclosure of facts and clean hands doctrine in legal proceedings.

Detailed Analysis:

1. The Company Appeal (AT) (CH) (INS) No. 337/2022 was filed challenging the Impugned Judgment of the NCLT, Kochi Bench on 21.01.2022. The Tribunal rejected the appeal on 24.11.2022, citing it was filed beyond the prescribed time limit. However, the Hon'ble Apex Court allowed the appeal on 07.08.2023, directing that the delay of 1 day should have been condoned, and the appeal should be heard on merits by NCLAT.

2. The main argument raised by the Appellant was based on the interpretation of the term "Aggrieved Person" under Section 61 of the I & B Code, 2016. The Appellant contended that being heard by the Tribunal, even if not a party to the proceedings, should confer the right to prefer an appeal as an Aggrieved Person. However, the Tribunal held that merely being heard does not entitle a person to file an appeal unless they are included as a party to the proceedings.

3. The Tribunal emphasized the importance of disclosing all relevant facts and maintaining clean hands in legal proceedings. The Appellants failed to disclose that they had simultaneously filed a Writ Petition seeking an interim order while pursuing the Company Appeal. The Tribunal noted that approaching the Tribunal with clean hands is essential, and concealment or distortion of facts can be grounds for rejecting an appeal. The Tribunal also highlighted the Appellants' history of filing multiple Writ Petitions, indicating a lack of transparency in their approach to legal remedies.

In conclusion, the Tribunal dismissed the Company Appeal due to the Appellants' failure to challenge the rejection of their Intervention Petitions, lack of disclosure of simultaneous legal actions, and the principle of clean hands in legal proceedings. The Tribunal emphasized the importance of transparency and adherence to procedural requirements in seeking legal remedies.

---