Service direction not uploaded in time: dismissal for want of notice steps was set aside

A party cannot be penalised for non-compliance with a direction to serve notice on the corporate debtor when the relevant order was not uploaded on the tribunal record in time for compliance before the next hearing date. The NCLAT noted that directions to take steps for service were passed, but the corresponding orders were uploaded only after the subsequent dates fixed for hearing. Applying the principle that no litigant should suffer for the fault or delay of the court, it held that the dismissal of the Section 7 petition for want of service steps was unsustainable and set aside the dismissal order.

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Issues: Whether the dismissal of the Section 7 petition for want of taking steps to serve notice on the corporate debtor was justified when the directions requiring service had not been uploaded on the tribunal record before the next date of hearing.

Analysis: The record showed that directions to take steps for service were passed on two dates, but the corresponding orders were uploaded only after the next dates fixed for hearing. In such a situation, the applicant could not be faulted for not taking steps, since the Registry would not have had the operative order available in time. The principle that no litigant should suffer for the fault or delay of the court supported interference with the dismissal order.

Conclusion: The dismissal order was unsustainable and was set aside.

Ratio Decidendi: A party cannot be penalised for failure to comply with a direction to serve notice when the order containing that direction was not uploaded in time for compliance before the next hearing date.

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