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Judgment
ORDER
[Per; Justice Rakesh Kumar Jain (MJ)] (ORAL)
21.07.2023: This Appeal is directed against the Order dated 06.03.2023, passed in Application bearing IA(IBC)/176(CHE)/2023 in CP(IB)/233(CHE)/2021, by which an Application filed by the Resolution Professional (`RP’) to liquidate the Corporate Debtor and to further appoint the Applicant as the Liquidator has been allowed.
The Appeal has been filed alongwith an Application bearing I.A. No. 695/2023 under Rule 11 of the National Company Law Appellate Tribunal, Rules, 2016 (`The Rules’) praying for Condonation of Delay of 15 days in filing of the Appeal.
Counsel for the Appellant has submitted that the Impugned Order was passed on 06.03.2023 but since the Appellant was not a party, therefore, the Appellant was not aware about it. It is the case of the Appellant (Suspended Director) that he came to know about the Impugned Order on 15.03.2023. He applied certified copy on 23.03.2023 which was made available to him on 29.03.2023. The Appeal was filed on 13.05.2023. It is therefore submitted that the Appeal could not be filed within the statutory period of 30 days and a further period of 15 days has been consumed in the preparation of the Appeal because of the complexity of the matter and verification and collation of records.
We have heard Counsel for the Applicant/Appellant and perused the record.
Section 61 of the Code deals with the Appeals to be filed before the Appellate Authority. Section 61 is being reproduced as hereunder:
“61. Appeals and Appellate Authority. -
(1)Notwithstanding anything to the contrary contained under the Companies Act 2013 (18 of 2013), any person aggrieved by the order of the Adjudicating Authority under this part may prefer an appeal to the National Company Law Appellate Tribunal.
(2)Every appeal under sub-section (1) shall be filed within thirty days before the National Company Law Appellate Tribunal:
Provided that the National Company Law Appellate Tribunal may allow an appeal to be filed after the expiry of the said period of thirty days if it is satisfied that there was sufficient cause for not filing the appeal but such period shall not exceed fifteen days.
(3)An appeal against an order approving a resolution plan under section 31 may be filed on the following grounds, namely: –
(i)the approved resolution plan is in contravention of the provisions of any law for the time being in force;
(ii)there has been material irregularity in exercise of the powers by the resolution professional during the corporate insolvency resolution period;
(iii)the debts owed to operational creditors of the corporate debtor have not been provided for in the resolution plan in the manner specified by the Board;
(iv)the insolvency resolution process costs have not been provided for repayment in priority to all other debts; or
(v)the resolution plan does not comply with any other criteria specified by the Board.
(4)An appeal against a liquidation order passed under section 33, or sub-section (4) of section 54L, or sub-section (4) of section 54N, may be filed on grounds of material irregularity or fraud committed in relation to such a liquidation order.
(5)An appeal against an order for initiation of corporate insolvency resolution process passed under sub-section (2) of section 54-O, may be filed on grounds of material irregularity or fraud committed in relation to such an order.”
Section 61(1) provides that any person who is aggrieved against the Order of the Adjudicating Authority can prefer an Appeal before the Appellate Authority.
Section 61(2) lays down the period within which the Appeal under Section 61(1) is to be filed. The said period has been fixed as 30 days. However, Section 61(2) proviso further provides for extension of time beyond the period of 30 days upto 15 days but not beyond that, in case the Applicant filing the Appeal alongwith Application of Condonation of Delay is able to satisfy the Appellate Authority that there exists a sufficient cause for not filing the Appeal within the prescribed time.
Although the period of Limitation is to be counted from the date of Order i.e., 06.03.2023 but keeping in view the contention of the Appellant that since he was not a Party to the Litigation, therefore, he was not aware of the Order dated 06.03.2023 and only came to know on 15.03.2023, therefore, the Limitation has to be counted form 15.03.2023 i.e., the date of knowledge. Admittedly, the certified copy of the Order was applied by the Appellant on 23.03.2023 which was made available to him on 29.03.2023. If the Limitation started from 15.03.2023 i.e., the date of knowledge then a period of 8 days had already expired out of the statutory period of 30 days when the certified copy was applied on 23.03.2023. However, the period spent for obtaining certified copy has to be excluded out of the period of 30 days i.e., from 23.03.2023 to 29.03.2023. From 29.03.2023, 22 days are available to the Appellant for the purpose of filing the Appeal without seeking Condonation of Delay which had in fact expired on 21.04.2023 and if the additional period of 15 days is also given to the Appellant then the same had expired on 06.05.2023, whereas admittedly the Appeal has been filed on 13.05.2023 i.e., much beyond the period of 15 days also.
As a matter of fact, on its own showing, the Appellant has consumed 52 days in coming to this Court with the Appeal.
It is pertinent to mention that the Hon’ble Supreme Court in the case of `National Spot Exchange Limited’ Vs. `Mr. Anil Kohli, Resolution Professional for Dunar Foods Limited’ reported in Civil Appeal No. 6187/2019, dealing with this aspect of the matter that as to whether the Appellate Authority has the jurisdiction to condone the delay beyond the period of 15 days provided in the proviso to Section 61(2) of the Code held that:
“11.2In the case of Teri Oat Estates (P) Ltd. v. U.T. Chandigarh, reported in (2004) 2 SCC 130, in paragraphs 36 & 37, it is observed as under:
“36.We have no doubt in our mind that sympathy or sentiment by itself cannot be a ground for passing an order in relation whereto the appellants miserably fail to establish a legal right. It is further trite that despite an extraordinary constitutional jurisdiction contained in Article 142 of the Constitution of India, this Court ordinarily would not pass an order which would be contravention of a statutory provision.
37.As early as in 1911, Farwell, L.J. In Latham v. Richard Johnson & Nephew Ltd. (1911-12) All ER Rep 117 observed: (All ER p. 123E) “We must be very careful not to allow our sympathy with the infant plaintiff to affect our judgment. Sentiment is a dangerous will o’ the wisp to take as a guide in the search for legal principles”
Thus, considering the statutory provisions which provide that delay beyond 15 days in preferring the appeal is uncondonable, the same cannot be condoned even in exercise of powers under Article 142 of the Constitution.
12.In view of the afore-stated settled proposition of law and even considering the fact that even the certified copy of the order passed by the adjudicating authority was applied beyond the period of 30 days and as observed hereinabove there was a delay of 44 days in preferring the appeal which was beyond the period of 15 days which maximum could have been condoned and in view of specific statutory provision contained in Section 61(2) of the IB Code, it cannot be said that the NCLAT has committed any error in dismissing the appeal on the ground of limitation by observing that it has no jurisdiction and/or power to condone the delay exceeding 15 days.”
In view of the aforesaid law laid down by the Hon’ble Supreme Court and the fact that the Appellant has been given the leverage of counting the period of Limitation from the date of its knowledge i.e., 15.03.2023 instead of 06.03.2023, he could not come within the extended period of 15 days for the purposes of maintaining this Application.
Even otherwise, the Appellant has made a sweeping statement that the Appeal could not be filed even within the period of 45 days because of the complexity of the matter and the verification and collation of the record. This statement, without there being any evidence as to what kind of documents were to be collected and how the time had been spent cannot be considered.
Thus, looking form any angle, we do not find it to be a fit case for the purpose of interference in the Application which is highly belated and beyond the scope of Condonation of Delay in view of the decision of the Hon’ble Supreme Court in `Nation Spot Exchange Limited’ (Supra).
With these observations, the present Application fails and the same is hereby dismissed. No Costs.
Comp. App. (AT) (CH) (Ins.) No.209/2023:
Since we have dismissed the Application for Condonation of Delay by an Order of the even date, therefore, this Appeal is not duly constituted and the same is also hereby dismissed.