TaxTMI 
TaxTMI 
2026 (3) TMI 758
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....ts). 2. Company Appeal (AT) (Ins.) No. 893 of 2024 has been filed challenging the order dated 18.03.2024, by which order, C.P.(IB)/61(AHM)2023 filed under Section 95 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the "IBC") has been dismissed as barred by time. Company Appeal (AT) (Ins.) No. 894 of 2024 has been filed challenging the order dated 19.03.2024, by which C.P.(IB)/60(AHM)/2023 has been dismissed as barred by time. Company Appeal (AT) (Ins.) No. 1280 of 2024 has been filed against the order dated 10.05.2024 by which order C.P.(IB) No.100/NCLT/AHM/2023 filed by the SBI has been dismissed as barred by time. Company Appeal (AT) (Ins.) No. 1281 of 2024 has been filed against the order dated 10.05.2024 by which order Adjudicating Authority dismissed C.P.(IB) No.101/NCLT/ AHM/2023 filed by the SBI as barred by time. These Appeal(s) raise common question of law and have been heard together and are being decided by this common judgment. 3. Company Appeal (AT) (Ins.) Nos. 893 & 894 of 2024 arise out of the same facts, dates and events. Relevant facts giving rise to these two Appeal(s) are: (i) The Corporate Debtor ("CD") - M/s Kandla Energy ....
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.... The Adjudicating Authority heard the parties and by the order dated 10.05.2024, rejected the application as barred by time. The Adjudicating Authority took the view that by extending the benefit of Hon'ble Supreme Court's order in Suo Motu WP (Civil) No.3 of 2020, the application is barred by time. Challenging the aforesaid orders, rejecting Section 95 application, these Appeal(s) have been filed. 4. We have heard Shri Siddharth Sangal, learned Counsel appearing for the Appellant(s); and Ms. Riya Dhingra, learned Counsel for the Personal Guarantors. 5. Learned Counsel for the Appellant challenging the impugned order submits that the Adjudicating Authority committed error in interpreting the order of the Hon'ble Supreme Court passed in Suo Motu Writ Petition (C) No.3 of 2020. It is submitted that in view of the order passed by the Hon'ble Supreme Court in Suo Motu Writ Petition (C) No.3 of 2020 and the last order being 10.01.2022, the limitation was required to be extended for 90 days i.e. upto 30.05.2022 or the balance period of limitation if it is more than 90 days in cases where limitation expired during the period 15.03.2020 till 28.02.2022. In these Appeal(s) a Decree wa....
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.... was passed by the DRT on 19.03.2018 and from which date fresh three years period of limitation will be available to the Appellant, which will come to an end on 18.03.2021. The applications under Section 95 in these set of Appeal(s) in Company Appeal (AT) (Ins.) Nos. 1280 & 1281 of 2024 was filed on 25.02.2023. 8. We need to consider the orders passed by the Hon'ble Supreme Court in Suo Motu Wirt Petition (C) No.3 of 2020 in Recognizance for extension of limitation. The first order which was passed by the Hon'ble Supreme Court in the above Writ Petition was on 08.03.2021. The Hon'ble Supreme Court looking to the spread of COVID-19 has issued directions in Paragraph-2, which are as follows: "2. We have considered the suggestions of the learned Attorney General for India regarding the future course of action. We deem it appropriate to issue the following directions: - 1. In computing the period of limitation for any suit, appeal, application or proceeding, the period from 15.03.2020 till 14.03.2021 shall stand excluded. Consequently, the balance period of limitation remaining as on 15.03.2020, if any, shall become available with effect from 15.03.2021. 2....
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....ections 23(4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings. IV. The Government of India shall amend the guidelines for containment zones, to state. "Regulated movement will be allowed for medical emergencies, provision of essential goods and services, and other necessary functions, such as, time bound applications, including for legal purposes, and educational and job-related requirements."" 10. The last order came to be passed by the Hon'ble Supreme Court in the above Writ Petition on 10.01.2022. It is useful to notice the entire order passed by the Hon'ble Supreme Court on 10.01.2022 in MA No.21 of 2022 in Suo Motu Wirt Petition (C) No.3 of 2020, which is as follows: 1. In March, 2020, this Court took Suo Motu cognizance of the difficulties that might be faced by the litigants in filing petitions/applications/suits/appeals/ all oth....
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....2021, it is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi- judicial proceedings. II Consequently, the balance period of limitation remaining as on 03.10.2021, if any, shall become available with effect from 01.03.2022 III. In cases where the limitation would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 01.03.2022. In the event the actual balance period of limitation remaining, with effect from 01.03.2022 is greater than 90 days, that longer period shall apply. IV. It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed under Sections 23(4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for i....
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....cribed." 13. The Hon'ble Supreme Court in the above case has held that when a particular period is to be excluded in relation to any suit or proceeding, essentially the reason is that such a period is accepted by law to be one not referable to any indolence on the part of the litigant, but being relatable to either the force of circumstances or other requirements of law. 14. The Hon'ble Supreme Court again had occasion to consider Suo Motu Writ Petition (C) No.3 of 2020 in Arif Azim Company Ltd. vs. Aptech Ltd. - (2024) 5 SCC 313. In Paragraphs-84 and 87, the Hon'ble Supreme Court had occasion to consider the effect of the order passed in Suo Motu Writ Petition (C) No.3 of 2020. In Paragraphs-84 and 87, following was held: "84. Thus, in ordinary circumstances, the limitation period available to the petitioner for raising a claim would have come to an end after an expiry of three years, that is, on 27-3-2021. However, in March 2020, the entire world was taken under the grip of the deadly Covid-19 Pandemic bringing everyday life and commercial activity to a complete halt across the globe. Taking cognizance of this unfortunate turn of events, this Court vide order dated....
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....case would be 31 months and 16 days which consequently would expire on 17.10.2024 and as Section 9 Petition was filed on 31.08.2023 it is well within the limitation period. 5. The Appellant categorically falls within the ambit of Para I of the said judgement whereby the period from 15.03.2020 to 28.02.2022 would stand excluded from the period of limitation. Even per Para IV of the judgement the limitation would extend. In Captain Sudhanshu Bhardwaj v. AIR India Limited (2023 SCC OnLine Del 8177), High Court of Delhi while interpreting the judgement of In Re: Cognizance for Extension of Limitation, expressly held that the period from 15.03.2020 till 28.02.2022 stood excluded for the purposes of the limitation. The court held: "... 12. Thus, the entire period from 15.03.2020 to 28.02.2022 is required to be excluded in computing the period of limitation. It follows that the period of limitation would stop running on 15.03.2020 and would start running again on 01.03.2022. Consequently, the balance period of limitation remaining as on 03.10.2021 as contemplated in para 5 (II) would be the same as balance period of limitation remaining as on 15.03.2020. 13. It ....
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.... NCLT. The appeal is thus allowed. Pending application, if any, are disposed of." 17. Learned Counsel for the Appellant has placed reliance on judgment of the Delhi High Court in OMP (T) COMM. 31/2023 in Captain Sudhanshu Bhardwaj vs. Air India Ltd. The Delhi High Court in Paragraphs 12 to 15 laid down following: "12. Thus, the entire period from 15.03.2020 to 28.02.2022 is required to be excluded in computing the period of limitation. It follows that the period of limitation would stop running on 15.03.2020 and would start running again on 01.03.2022. Consequently, the balance period of limitation remaining as on 03.10.2021 as contemplated in para 5 (II) would be the same as balance period of limitation remaining as on 15.03.2020. 13. It is incongruous to suggest that while the period from 03.10.2021 to 28.02.2022 is to be excluded for the purpose of calculating period of limitation, the same is not to be done for the period from 15.03.2020 to 02.10.2021. Doing so would be inconsistent with the plain language of para 5 (I) of the order dated 10.01.2022. 14. The order dated 10.01.2022 cannot be construed to reach the conclusion that limitation continue....
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.... the entire period from 15.03.2020 to 28.02.2022 (approximately two years), limitation would be available till March, 2024. However, both the petitions to initiate PIRP involved in this batch of appeals were filed respectively in November and December, 2022. Needless to state they are within time." 19. The above judgment relied by the learned Counsel for the Appellant, do support the submission of the Appellant that after 28.02.2022, the Appellant was entitled for a larger period of limitation, which was balanced as per computation indicated above. 20. Thus, the bone of contention of the parties in this case is as to whether Applicant shall be entitled for the limitation of 90 days, since limitation in both the set of Appeal(s) expired on 24.06.2021 and 18.03.2021, i.e. during the period from 15.03.2020 to 28.02.2022. Learned Counsel for the Appellant submits that with effect from 01.03.2022, the Appellant shall be entitled for balance period of limitation and, not, only 90 days as contended by the learned Counsel for the Respondent. It is submitted that period of 90 days with effect from 01.03.2022 was given to those litigants whose period of limitation has expired during th....
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....tation expiring between March 15, 2022 and February 28, 2022 cannot arise. Hence, paragraph 5(III) of the order of this court dated January 10, 2022, has no application to the facts of this case." 22. The above judgment of the Hon'ble Supreme Court reiterates the proposition that benefit of entire period from 15.03.2020 to 28.02.2022 is available and the entire period shall be excluded. Since, in the facts of the said case, limitation was not expiring between 15.03.2020 to 28.02.2022 due to acknowledgment dated 12.08.2020, a fresh period of limitation was available. 23. Reverting to the facts of the present case, in the present case, the limitation for filing application under Section 95 was expiring on 24.06.2021 and 18.03.2021 respectively, which was within the period between 15.03.2020 to 28.02.2022, hence, the case was fully covered by Paragraph 5.III of the order of the Hon'ble Supreme Court dated 10.01.2022, which entitles the Applicant to claim actual balance period of limitation remaining and available with effect from 01.03.2022. 24. We now need to notice as to what was the balance period of limitation in both the above set of Appeal(s). In Company Appeal (AT) (In....
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.... 28.02.2022 was to be extended by excluding the said period and balance period of limitation remaining as on 01.03.2022 would become available. Thus, considering all the directions in Paragraphs 5.I to 5.IV, it is clear that the period from 15.03.2020 to 28.02.2022 shall be excluded for computing the period prescribed under the law. Thus, even considering Article 137 of the Limitation Act, 1963 with regard to application under Section 95, while computing the period of three years with effect from date of Decree of the DRT, the period elapsed between 15.03.2020 till expiry of normal period of limitation of three years, has to be excluded. 27. In view of the aforesaid we are of the view that giving the benefit of order of the Hon'ble Supreme Court in Suo Motu Writ Petition (C) No.3 of 2020, last order being 10.01.2022, the application filed by SBI against the Respondent(s) - Personal Guarantors, cannot be said to be barred by time. The Adjudicating Authority in the impugned order committed error in observing that time available was 90 days period upto 30.05.2022. It is useful to notice Paragraph-5 of the impugned order dated 18.03.2024 in Company Appeal (AT) (Ins.) Nos. 893 & 894 ....