2024 (10) TMI 905 - AT - IBC

NCLAT rejects 451-day delay condonation under Section 61 IBC due to appellant's failure to seek certified copy within mandatory period

Southern Power Distribution Company of Telangana Ltd. Versus Kalvakolanu Murali Krishna Prasad Resolution Professional for Vaksh Steels Pvt. Ltd., Committee of Creditors of Vaksh Steels Pvt. Ltd., SVSS Commercial Pvt. Ltd.

Southern Power Distribution Company of Telangana Ltd. Versus Kalvakolanu Murali Krishna Prasad Resolution Professional for Vaksh Steels Pvt. Ltd., ... Issues Involved:1. Determination of the period of limitation for filing an appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016.2. Applicability of the Supreme Court's Suo Motu Writ Petition judgment on extending the limitation period due to the Covid-19 pandemic.3. Requirement of applying for a certified copy of the judgment within the prescribed period of limitation.4. Definition and implications of 'party' and 'person aggrieved' under the Insolvency and Bankruptcy Code, 2016.5. Knowledge of proceedings and its impact on limitation.Detailed Analysis:1. Determination of the Period of Limitation:The appeal was filed against an order dated 31.01.2020, but the appeal was lodged on 28.05.2021, well beyond the prescribed 30-day period under Section 61 of the IBC, 2016. The appellant argued that the period of limitation should commence from the date of knowledge of the order. However, the tribunal emphasized that the limitation period begins from the date of the order, not from when the appellant became aware of it. The appellant's delay of 451 days in filing the appeal was not excused, as the appellant failed to apply for a certified copy of the judgment within the original limitation period.2. Applicability of the Supreme Court's Suo Motu Writ Petition Judgment:The appellant sought to benefit from the Supreme Court's order extending the limitation period due to the Covid-19 pandemic, which suspended the running of limitation from 15.03.2020 to 28.02.2022. However, the tribunal held that this benefit could not be availed because the appellant did not apply for the certified copy within the statutory period of limitation, which expired before the commencement of the extended period on 15.03.2020.3. Requirement of Applying for a Certified Copy:The tribunal highlighted the necessity of applying for a certified copy of the judgment within the prescribed limitation period as per Rule 22(2) of the NCLAT Rules, 2016. The appellant's failure to do so barred them from claiming the extension of the limitation period. The act of applying for a certified copy is not merely a technical requirement but an indication of the appellant's diligence in pursuing the appeal.4. Definition and Implications of 'Party' and 'Person Aggrieved':The tribunal clarified that the term 'party' includes any person interested in the appeal or application, as defined under the NCLT Rules, 2016. The appellant, being a member of the Committee of Creditors (CoC), was deemed to have knowledge of the proceedings and thus could not claim ignorance. The tribunal further distinguished between 'party' and 'person aggrieved,' noting that the latter includes any individual affected by the judgment, even if not directly involved in the proceedings.5. Knowledge of Proceedings and Its Impact on Limitation:The tribunal rejected the appellant's claim of lack of knowledge, noting that email communications indicated the appellant's awareness of the proceedings. The appellant's participation in CoC meetings and the generation of communications from their email address established a presumption of knowledge. The tribunal emphasized that knowledge of the proceedings is crucial in determining the limitation period, and the appellant's failure to act within the prescribed period precluded them from benefiting from the extended limitation due to the Covid-19 pandemic.Conclusion:The tribunal dismissed the application for condonation of delay, as the appellant failed to apply for a certified copy within the prescribed period and could not benefit from the extended limitation due to Covid-19. Consequently, the appeal was dismissed as time-barred, and the connected interlocutory applications were closed.