MLS LED Ltd. vs HQ Lamps & Manufacturing Company Pvt. Ltd.

Per: Justice Rakesh Kumar Jain:

I.A. No. 1548 of 2022: This application is filed seeking condonation of delay of 10 days in filing the present appeal.

In brief, the Appeal has been filed by the Unsuccessful Applicant (MLS LED Ltd.) whose application, bearing CP (IB) No. 219/ALD/2018, filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (in short ‘Code’) against HQ Lamps and Manufacturing Company Pvt. Ltd. (Respondent herein) has been dismissed by the Adjudicating Authority (National Company Law Tribunal, Allahabad Bench, Prayagraj).

The Appeal has been filed under Section 61(1) of the Code. The relevant averments made in the application seeking condonation of delay are as under:-

The Respondent has filed the reply to this application in which it is averred that the appellant has wrongly mentioned the number of days as 10 days in the application because the impugned order was passed on 02.03.2022, last date for filing the appeal, in terms of Section 61(2) of the Code, was 01.04.2022, the extended period of 15 days expired on 16.04.2022 whereas the appeal has been filed on 20.04.2022 i.e much beyond the period of 30+15=45 days and in view of the decision of the Hon’ble Supreme Court, rendered in the case of National Spot Exchange Limited Versus Anil Kohli, Resolution Professional for Dunar Foods Limited, Civil Appeal No. 6187 of 2019, delay beyond the period of 15 days cannot be condoned and the appeal is thus not maintainable.

It is further averred in the reply that in the application, the Appellant has wrongly calculated the period of limitation from the date of uploading the order on the website of NCLT on 14.03.2022 because the limitation is not to be counted from the date of knowledge but from the date of passing of the order as has been held by the Hon’ble Supreme Court in the case of V. Nagarajan Vs. SKS Ispat & Power Ltd., (2022) 2 SCC 244.

It is further averred in the reply that the Appellant/Applicant even did not apply for the certified copy of the impugned order, therefore, it is not entitled to seek exclusion of the period from the date of pronouncement of the order till the date of its uploading for the purpose of counting the limitation.

It is also averred that as per the decision of the Supreme Court, rendered in the case of Lingeswaran Etc. Vs. Thirunagalingam [Petition (s) for Special Leave to Appeal (C) Nos. 2054-2055 of 2022] decided on 25.02.2023, it is imperative to show sufficient cause for the purpose of condonation of delay as it cannot be condoned on equity.

The Appellant/Applicant has filed the rejoinder in which it is admitted that the operative portion of the impugned order was pronounced in open court on 02.03.2022 but it is stated that copy of the full judgment was made available on 14.03.2022 when it was uploaded on the website of the NCLT.

It is also averred that clerk of the counsel who appeared before the Adjudicating Authority kept a regular watch on the NCLT website after 02.03.2022 in order to check as to whether the full judgment has been uploaded on the website or not which was ultimately uploaded on 14.03.2022. Besides this, it is also averred that the Appellant had simultaneously applied for the certified copy through the local counsel on 02.03.2022 which was made available on 16.03.2022. It was promptly dispatched to the main counsel’s office at New Delhi but by mistake it was sent to the Appellant’s main counsel’s previous office address and thus the certified copy was misplaced. It is also averred that the local counsel for the Appellant made several inquiries from the Registry of the NCLT but the record of the certified copy could not be traced as the office of the Tribunal was shifted.

In the backdrop of the aforesaid averments made in the pleadings, Counsel for the Appellant/Applicant has argued that the period spent for obtaining the certified copy from 02.03.2022 to 16.03.2022 if deducted, the appeal would be within the period of 15 days which may be considered by this Tribunal for condonation of delay.

On the other hand, Counsel for the Respondent has submitted that the Appellant, in its anxiety, has set up various stories for the purpose of seeking condonation of delay but neither of it is believable because the only averment made in the application is that the copy of the order was uploaded on the website of the NCLT on 14.03.2022, therefore, the limitation has been counted from the said date instead of pronouncement of the order dated 02.03.2022, therefore, it is alleged in the application that there is a delay of 10 days but when the reply was filed by the Respondent and it was pointed out that the limitation has to be counted from 02.03.2022 in view of the decision of the Hon’ble Supreme Court in the case of V. Nagarajan (Supra) i.e. the date of pronouncement of the order and not the date of knowledge and since the period of 45 days had expired on 16.04.2022 and the appeal has been filed on 20.04.2022, therefore, the appeal was clearly beyond the period of 45 days and not maintainable in view of the decision of the Hon’ble Supreme Court in the case of National Spot Exchange Limited (Supra), the Appellant has changed the story in the rejoinder alleging that the certified copy was in fact applied on 02.03.2022 and obtained on 16.03.2022 but it has been misplaced, therefore, the period spent for obtaining the certified copy has to be excluded. It is further submitted that the Appellant has wrongly averred that it could not obtain the record from the Tribunal because its office was shifted. It is argued by the Respondent that office of the Tribunal was shifted three years before the passing of the impugned order and hence, the story propounded by the appellant does not inspire confidence.

We have heard Counsel for the parties and perused the record with their able assistance.

Admitted facts of this case are that the impugned order was passed on 02.03.2022 and in this regard, the Respondent has appended the cause list of 02.03.2022 as Annexure R3 with the reply in which the present appeal has been shown as ‘for pronouncement of order, Sr. No. P1, CP No. (IB)219/ALD/2018 for order’. It is admitted by the Appellant in the rejoinder that the order was pronounced in their presence. In such circumstances, the decision of the Hon’ble Supreme Court delivered in the case of V. Nagarajan (Supra) would apply which says that limitation shall start running from the date of order whereas the case set up by the Appellant in the application is that since the impugned order was uploaded by the Tribunal on 14.03.2022, therefore, the limitation shall be counted from the said date and thus there is a delay of 10 days in filing the present appeal.

In order to overcome the difficulties being faced, the Appellant has developed a new story in order to take the advantage of Section 12 of the Limitation Act, 1963 as per which the period spent by the office in preparing the certified copy has to be excluded from the total period of limitation and in this regard, it is alleged that after the order was pronounced on 02.03.2022 the certified copy was applied which was made available on 16.03.2022 but it was mistakenly sent to the previous office address of the counsel at New Delhi and was misplaced. The Appellant has not applied for the certified copy again for the purpose of placing it on record. The story which has now been propounded and made a part of their rejoinder is totally unbelievable because had it been a situation as suggested, it would have been the first averment in the application itself instead of a plea in the rejoinder.

Thus, in our considered opinion, story propounded in the rejoinder is a made-up story at the instance of the Appellant which cannot be believed and as it has been held in the case of Lingeswaran Etc. (Supra) the limitation is to be condoned on a sufficient cause and not on equity, the Appellant cannot take any advantage of alleging that the Court should apply soft hand for the purpose of considering the application for condonation of delay.

Thus, in view of the aforesaid discussion, we hardly find any merit in the present application, much less sufficient cause, for the purpose of condonation of delay, therefore, the application is found devoid of any merit and the same is hereby dismissed though without any order as to costs.

Since, the application for condonation of delay has been dismissed by an order of even date, therefore, the appeal is found to be not duly constituted and the same is hereby dismissed.