2024 (10) TMI 1136 - AT - Companies Law

NCLAT rejects delay condonation for 68-day late appeal under Section 421(3) citing appellant negligence

Col. Ashish Khanna (Retd.) Versus Delhi Gymkhana Club & Ors.

NCLAT dismissed the delay condonation application for a 68-day delayed appeal filing. The tribunal found no sufficient cause shown by appellant for the ... Condonation of delay of 68 days of filing appeal - sufficient cause for delay or not - whether there is any reason to record satisfaction that the Appellant was prevented by sufficient cause from filing the appeal within that period? - HELD THAT:- No sufficient cause has been shown by the Appellant as to how he was prevented from filing the appeal within period as required under Section 421(3) proviso. It is not persuaded to entertain submission of the Appellant on the merits of challenge to the order impugned. There is one more reason due to which Appellant’s prayer in the application for condonation of delay cannot be allowed. It is noted that the judgment of the Hon’ble Supreme Court in Ramlal, Motilal, Chotelal [1961 (5) TMI 54 - SUPREME COURT] where it has been held that even after sufficient cause has been shown by the parties, parties are not entitled to condonation of delay in question as a matter of right. Even if sufficient cause has been shown Court has to enquire as to whether it should exercise its discretion to condone the delay. The Appellant has not even shown any sufficient cause that he was prevented to file an appeal rather Appellant is clearly negligent in filing the appeal since he was well aware of the order even prior to 22.02.2024 and has filed two applications - Appellant has already pleaded that extension of time be granted without prejudice to the rights of the Appellant to file appeal. Thus, Appellant has already pleaded that he has right to file an appeal without prejudice to the extension of time. It is not satisfied that Appellant was prevented by sufficient cause from filing the Appeal within the extended period of 45 days. The Delay Condonation Application deserves to be dismissed and is hereby dismissed. Issues Involved:1. Condonation of Delay in Filing Appeal2. Validity of the Order Dated 15.12.20233. Jurisdiction and Merits of the AppealDetailed Analysis:1. Condonation of Delay in Filing Appeal:The primary issue in this judgment was whether the delay of 68 days in filing the appeal should be condoned. The Appellant argued that the delay was within the condonable period of 45 days after the initial 45-day period as provided by Section 421(3) of the Companies Act, 2013. The Appellant claimed that the order dated 15.12.2023 was communicated to him on 22.02.2024, and he had sought an alternate remedy by filing CA No.49 of 2024 to recall the order, which was dismissed on 14.03.2024. The Tribunal examined whether there was a sufficient cause for the delay, noting that the Appellant was aware of the order from the date of its pronouncement and had filed applications related to the order prior to receiving the alleged communication. The Tribunal concluded that the Appellant failed to demonstrate sufficient cause for the delay, emphasizing that mere awareness of the order and subsequent actions indicated negligence rather than a valid reason for delay.2. Validity of the Order Dated 15.12.2023:The Appellant contended that the order dated 15.12.2023 was per incuriam and a nullity, arguing that the Single Member Bench lacked jurisdiction to pass such an order. The Tribunal, however, noted that without condoning the delay, it could not entertain the merits of the appeal or the validity of the order. The Appellant's reliance on a previous judgment regarding jurisdiction was not considered, as the Tribunal focused solely on the procedural aspect of the delay.3. Jurisdiction and Merits of the Appeal:The Tribunal highlighted that it lacked jurisdiction to address the merits of the appeal without first condoning the delay. The Appellant's argument that the order was a nullity and thus the delay was inconsequential was not accepted. The Tribunal cited legal precedents emphasizing that without condonation of delay, the merits of the appeal could not be considered. The Tribunal reiterated that the existence of a sufficient cause is a prerequisite for exercising discretion to condone delay, which was not established in this case.Conclusion:The Tribunal dismissed the application for condonation of delay, finding no sufficient cause for the delay in filing the appeal. Consequently, the appeal itself was rejected. The judgment underscores the importance of adhering to procedural timelines and the necessity of demonstrating sufficient cause for delays in legal proceedings.