2026 (2) TMI 608 - AT - IBC

Condonation of delay under the Insolvency Code denied where statutory outer limit exceeded and service record upheld.

Condonation of delay under the Insolvency and Bankruptcy Code was refused because the statutory scheme fixes a 30-day period with a non-extendable 15-day ... Computation of limitation from date of pronouncement of order - statutory limit on condonation of delay u/s 61(2) of the IBC for filing of Appeal - effectiveness of service and its bearing on limitation - absence of jurisdiction to condone delay beyond thirty plus fifteen days - Validity of service of notice of the Section 7 proceedings and whether the Appellant's plea of non-service justified computation of limitation from date of knowledge - HELD THAT:- Mere mechanical dispatch of notices or postal tracking entries by them, without proof of actual and effective delivery, did not satisfy the requirement of service in law. This denied the Appellant the opportunity to contest the Section 7 proceedings. The Corporate Debtor eventually became aware of the impugned order only after the Interim Resolution Professional had contacted an ex- auditor of the Corporate Debtor’s team. In such peculiar circumstances, where the Appellant remained thoroughly unaware of the Section 7 proceedings even after the pronouncement of the ex-parte order, hence, the limitation period should be counted from the date of acquiring knowledge of the impugned order by them. Any denial of condonation of delay in such circumstances would amount to giving precedence to procedural limitation over substantive justice. It is the case of the Respondent No.1 that the limitation period commences from the date of pronouncement of the impugned order and that any delay beyond the statutory outer limit of 45 days cannot be condoned under Section 61(2) of the IBC. There is no material placed on record by the Appellant to show that the registered address and email id of the Corporate Debtor as available on the MCA portal had undergone any change. Though an assertion was made by the Appellant before us that they were in the process of changing such information, the Appellant had no clear answer to the fact as to why and how the MCA database still reflected the same registered address and email- id even after the passing of the impugned order which the Respondent No. 1 has placed at Annexure R-3 in their reply to the delay condonation application filed by the Appellant. We therefore find the stand of the Appellant on change in their address and email to be rather nebulous and do not feel convinced with the credibility of their argument. Statutory construct of the IBC - condonation of delay under Section 61(2) - HELD THAT:- The impugned order was passed on 21.08.2025. For counting the statutory period of 30 days for filing the appeal, the same is to be counted from the day after the date of pronouncement of the impugned order. The date of knowledge of impugned order is immaterial for limitation computation. Calculated accordingly, the statutory period of 30 days for filing the appeal in the present case came to an end on 20.09.2025. The further extendable period of 15 days in terms of proviso to Section 60(2) of the IBC ended on 05.10.2025. However, the present appeal has been e-filed by the Appellant on 17.11.2025 which date prima facie lies beyond the outer limit of thirty plus fifteen days provided under Section 61(2) of the IBC and therefore beyond the condonable jurisdiction of this Appellate Tribunal as held by the Hon’ble Apex Court in Tata Steel [2025 (5) TMI 661 - SUPREME COURT] Thus, we are of the considered view that the Appeal has been filed beyond the condonable period of 15 days. The jurisdiction of this Appellate Tribunal to condone delay being strictly limited by statute, we are unable to condone the delay in the filing of this Appeal. Accordingly, the delay condonation application is dismissed. Issues: Whether the delay of 59 days in filing an appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016 can be condoned beyond the statutory outer limit of thirty plus fifteen days where the appellant contends lack of effective service and delayed knowledge of the impugned ex parte order.Analysis: Section 61(2) prescribes a statutory period of thirty days for filing an appeal, with a proviso permitting the Appellate Tribunal to condone delay only for a further period not exceeding fifteen days. Where a statute expressly limits the period within which delay may be condoned, the Tribunal lacks power to extend that period beyond the statutory outer limit. The date for computation of limitation is the day after pronouncement of the impugned order; the appellant's subsequent claim of acquiring knowledge at a later date does not alter the computation under the statutory scheme. The record of service, including directions to serve by all modes and proof of delivery relied upon by the Adjudicating Authority, was considered; the appellant did not place sufficient material to displace the finding of service or to establish a basis for extending the statutory condonable period.Conclusion: The application for condonation of delay is rejected and the appeal cannot be entertained as it was filed beyond the statutory outer limit of thirty plus fifteen days; the appeal and ancillary applications are accordingly rejected.