Rejoinder in insolvency proceedings cannot be excluded on technical grounds after delay is condoned, absent any express bar.

In a Section 7 insolvency proceeding, Rule 42 of the NCLT Rules, 2016 was treated as permitting a rejoinder where the respondent introduces additional facts needed for a just decision. After delay in filing the rejoinder was condoned, the adjudicating authority could not refuse to consider its factual assertions on a technical ground, because there is no express bar on additional pleadings or documents before final adjudication. The appellate tribunal was expected to correct that error. The refusal to consider the rejoinder was therefore held unsustainable, and the challenge to the appellate order succeeded.

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Issues: Whether, after condoning delay in filing a rejoinder in a Section 7 insolvency proceeding, the adjudicating authority could refuse to consider the factual assertions made therein and whether the appellate tribunal was justified in upholding that approach.

Analysis: Rule 42 of the National Company Law Tribunal Rules, 2016 permits filing of a rejoinder where the respondent raises additional facts necessary for a just decision. In light of the settled principle that there is no express bar on filing additional pleadings or documents in a Section 7 proceeding until final adjudication, the exclusion of the rejoinder's contents after permitting delayed filing was treated as a technical and erroneous approach. The appellate tribunal was expected to correct that error.

Conclusion: The refusal to consider the rejoinder's assertions was held to be unsustainable, and the challenge against the appellate order succeeded.

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