Sandeep Kasare vs Somerset Estate Private Limited & Anr.

[Per: Arun Baroka, Member (Technical)]

The Appellant - Sandeep Kasare preferred this Appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016 (“the Code”) against the Impugned Order of the National Company Law Tribunal, Mumbai Bench-IV (“Adjudicating Authority”), dated 07.03.2024 passed in CP(IB)/795/MB-IV/2023 by which the Adjudicating Authority has ordered Corporate Insolvency Resolution Process (‘CIRP’) against the Respondent No.1 -Somerset Estate Private Limited.

Before proceeding further in the main Appeal, we go on to decide Interlocutory Application No. 616/2025 (IA No. 616/2025) which is filed by Mr. Sandeep Kasare – Appellant /Applicant, who is the Power of Attorney holder of Ms Anupama Agarwal (Ms Anupama), the Erstwhile Director of Somerset Estate Pvt Ltd (Corporate Debtor). This Application is filed for condonation of delay of 280 days in refiling the present Appeal.

It is claimed by the Appellant that the present Appeal was filed on 06.04.2024 by the Appellant herein for and on behalf of Anupama Agarwal, the Shareholder of the Corporate Debtor. Thereafter, the registry of this Court has marked defects on 12.04.2024. On 10^th May 2024, subsequent to filing of the Appeal, the father in law of Ms Anupama Agarwal suddenly expired and Ms Anupama Agarwal was mentally disturbed with the untimely death of her father-in-law. Even though Ms Anupama Agarwal was the Shareholder of the Company, however, the entire records and other proceedings in regards to the Corporate Debtor were managed by the father-in-law of Ms Anupama Agarwal. She took some time to come out of the loss suffered on account of death of her father-in-law. Thereafter, Ms Agarwal took time to secure all the documents which were in the custody of her father-in-law, which were not Company Appeal (AT) (Insolvency) No. 154 of 2025 2 of 12 available with Ms Agarwal. In view of the same, the delay in re-filing the instant Appeal has crept in, which was not intentional or deliberate. It is claimed that, no prejudice shall be caused to the Respondents if the instant Application is allowed. Further, this Application is being filed bonafide and in the interest of justice. It is claimed that the Appeal was filed within limitation i.e. on 06.04.2024, which goes to show that the Appellant was diligent to pursue his legal remedies as prescribed in the code. Subsequently, registry marked number of defects in the Appeal on 12.04.2024. It is pertinent to note that, the Appellant herein is the Power of Attorney holder of Mrs. Anupama Agarwal, the Shareholder and Erstwhile Director of the Corporate Debtor/ Respondent No.1, her father-in-law, was the Shareholder of Respondent No.1, holding 50% shareholding and entire documents in relation to this matter were in his custody and management. Unfortunately, Mr. Kamlesh Agarwal who had been ill, passed away on 10.05.2024, which left Mrs. Anupama Agarwal and the entire family grieving and unable to give instructions to the advocates. It took substantial amount of time to locate the documents required to re-file along with the Appeal and take necessary instructions and the Appeal was refilled on 23.01.2025. The delay in re-filing the present Appeal was not intentional or deliberate on behalf of the Appellant and the delay is explainable as stated above.

The Appellant has relied on the judgment of this Appellate Tribunal in Nishant Bhutada vs Tata Motors Pvt. Ltd. in Competition Appeal (AT) No. 9 of 2024 & I.A. No. 4958, 5288 of 2024, wherein this Appellate Company Appeal (AT) (Insolvency) No. 154 of 2025 3 of 12 Tribunal condoned the delay in re-filing of 228 days on the ground of ill-health of the father of Appellant as well as ill-health of the father of the Counsel.

Reliance is also placed upon the order dated 25.01.2024 in Innovators Cleantech Pvt. Ltd. vs Pasari Multi Projects Pvt. Ltd. IA No. 294 of 2024 in Company Appeal (AT) (Insolvency) No. 115 of 2024 wherein this Appellate Tribunal condoned the delay in re-filing of 86 days on the ground that the documents were misplaced and took some to search it and further time was taken by counsel to verify the facts and relevant documents.

Further, reliance is placed upon order dated 03.02.2025 passed by this Tribunal in Shreenathii Infrastructure Vs Namasthetu Infratech Pvt. Ltd. Company Appeal (AT) (Insolvency) No. 2153 of 2024 & IA No. 7602 of 2024, wherein this Appellate Tribunal condoned the delay in refiling of Appeal of 104 days, inter-alia on the ground being that the documents were stored in Appellant's Company's office in Bhopal.

The Appellant claims that the Appeal could not be dismissed solely on the ground of limitation and the Appeal is found to have merits. The Appellant claims that this Tribunal had issued notice to the Respondents on the main Company Appeal (AT) (Insolvency) No. 154 of 2025 on 04.02.2025 after being satisfied that the Appeal warranted further consideration. But the said order was later recalled vide order dated 16.04.2025 on the ground that the application seeking condonation of delay in refiling had not been considered. But this Appellate Tribunal did not find the Appeal to be devoid of merit for this reason. Appellant places its reliance on the judgment of the Hon'ble Company Appeal (AT) (Insolvency) No. 154 of 2025 4 of 12 Supreme Court in the matter of Manoharan vs Sivarajan & Ors. (2014) 4 SCC 163, wherein it has been held that when substantial justice and technical consideration are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay and further held that ordinarily discretion to be exercised in favour of litigating parties unless there are manifest grounds of mala fide. Therefore, when the merits are apparent and this Appellate Tribunal has previously shown satisfaction on that front, it would be unjust to dismiss the Appeal solely on the ground of delay in re-filing and liberal approach must be taken when considering the Application for condonation of delay. Reliance is also placed on judgment of the Hon'ble Supreme Court in the matter of Esha Bhattacharjee vs Managing Committee of Raghunathpur Nafar Academy and Ors., (2013) 12 SCC 649 as well as "University of Delhi vs Union of India & Ors. Civil Appeal Nos. 9488/9489 of 2019".

Appellant also claims that the delay of filing the Appeal and delay in refiling the Appeal are different and this Tribunal has held that a liberal approach should be followed while considering delay in refiling the Appeal and it has placed reliance on five judges bench judgment of this Tribunal in V.R. Ashok Rao & Ors. vs. TDT Copper Ltd. I.A. No. 2095 of 2022 in Company Appeal (AT) (Ins.) No. 780 of 2022, wherein it has been held that Scheme of Rule 26 of the NCLAT Rules 2016, does not indicate that if the defects are not removed within seven days, the re-presentation of the Appeal after removal of defects beyond 7 days shall be treated as fresh Appeal. That re-presentation/ Company Appeal (AT) (Insolvency) No. 154 of 2025 5 of 12 re-filing of the Appeal has no bearing on the question of computation of limitation. That Rule 26(3) gives specific power to extend the time for compliance, the period of 7 days cannot be said to be mandatory period and is only directory. Further, it was also held that a party who is exercising its right to file a statutory appeal in time has not to be shut out on some procedural or technical defects. It also claims that it is a settled law that the Appellant may not explain each day in delay in filing or refiling the Appeal. It places reliance upon decision of Hon'ble High Court of Bombay in the case of Brihan Mumbai Electric Supply and Transport through its General Manager vs BEST Jagrut Kamgar Sanghatana through Parivartan and Ors., 2023 SCC OnLine Bom 2530, wherein it has been held that explanation for day-to-day delay is not necessarily to be given. Broadly the reasons for the delay are mentioned and they cannot be disbelieved.

Per contra the Respondent contends that as per Rule 26 (2) of National Company Law Appellate Tribunal Rules, 2016 (“NCLAT Rules”), seven days are prescribed for refiling of the Appeal from the date when the Registry intimates the defects to the Appellants. In the present case, there is an exorbitant delay of 280 days in refiling the Appeal and neither sufficient nor reasonable cause has been shown by the Appellant that would allow for condonation of the said delay. Appellant in IA No. 616/2025 submitted that the Appeal was filed on 06.04.2024. Subsequently, on 12.04.2024 certain defects were pointed out by the Registry. It is further submitted that on 10.05.2024 the father-in-law of Ms Anupama passed away and it is contended Company Appeal (AT) (Insolvency) No. 154 of 2025 6 of 12 that the father-in-law was managing all records pertaining to the Corporate Debtor and due to his demise, additional time was required to retrieve and secure the relevant documents which were in his possession. However, the Appellant has failed to offer any explanation for the delay of 27 days in refiling, i.e., for the period between 12.04.2024, when the defects were notified on 09.05.2024. The defect sheet has not been annexed with IA No. 616/2025 to substantiate or clarify the nature of the defects pointed out by the Registry. Moreover, Appellant has not even explained which of the defects required the assistance of Ms Anupama or her father-in-law, who was allegedly managing the relevant records.

The Appellant refiled the Appeal along with IA No. 616/2025 on 24.01.2025 without serving copies to the Respondents and when the Appeal was listed for the second time on 04.02.2025, this Appellate Tribunal issued notice without condoning the delay, as IA No. 616/2025 was never placed before this Appellate Tribunal by the Appellant. Since the Appeal had not been served to Respondent No. 2 until 04.03.2025, Respondent No. 2 was unable to bring IA No. 616/2025 to the attention of this Appellate Tribunal. It was only upon service of the Appeal along with IA No. 616/2025 that Respondent No. 2 became aware of the delay and the pending Application for condonation of delay. As the Appellant misled this Appellate Tribunal into issuing notice without disclosure of the delay, therefore, Respondent No. 2 filed an application for recall of the Order dated 04.02.2025 on 01.04.2025, which was allowed on 16.04.2025. The foregoing facts clearly establish that the Appellant had no intention of bringing IA No. 616/2025 to the notice of this Company Appeal (AT) (Insolvency) No. 154 of 2025 7 of 12 Appellate Tribunal and deliberately sought to proceed with the Appeal without obtaining condonation of 280 days delay. This conduct appears to have been adopted as the Appellant lacked any justifiable cause for the inordinate delay of 280 days in refiling the Appeal. This Appellate Tribunal in Dhanlaxmi Bank Limited vs Ritu Rastogi and Others (2025 SCC OnLine NCLAT 385), Govardhan Nirman Pvt Ltd vs Vaibhav Khandelwal and Anr (2024 SCC OnLine NCLAT 2065) and Employees Provident Fund Organisation vs HL Buildwell Pvt Ltd (2025 SCC OnLine NCLAT 324) has noted that the delay in refiling can only be condoned if the Appellate Tribunal is satisfied of the existence of a reasonable and justifiable cause for not refiling in time. However, in the present case it is evident that the Appellant has failed to establish any sufficient or justifiable cause for the inordinate delay of 280 days in refiling the Appeal. The explanation offered that Ms Anupama, a shareholder of the Corporate Debtor was unable to provide the relevant documents as the records were managed by her father-in-law is vague, unsubstantiated and lacks any evidentiary support. Such a contention is devoid of merit and cannot be accepted as a valid ground for condonation of delay. Therefore, in view of the foregoing the present Application is liable to be dismissed. The Corporate Insolvency Resolution Process is a time-bound mechanism under the IBC and an inordinate delay of 280 days without any justifiable cause undermines the objective of expeditious resolution and serves only as an impediment to the statutory timelines prescribed under the Code. Company Appeal (AT) (Insolvency) No. 154 of 2025 8 of 12

The captioned Appeal came for hearing before this Tribunal on 04.02.2025, and this Tribunal after considering the merit in the submissions made issued notice on the main Appeal. However, the said order dated 04.02.2025 was later recalled by this Tribunal pursuant to I.A. No. 2148 of 2025, filed by Respondent No.2, on the ground that notice has been issued on the Application seeking condonation of delay in re-filing (L.A. 616 of 2025). Thereafter, the present Application seeking condonation of delay in refiling the Appeal came up for hearing on 13.05.2025 and this Tribunal was pleased to reserve orders on the said Application.

We have heard the Learned Counsel for both sides and also perused material placed on record. The present Appeal was filed on 06.04.2024 by the Appellant - Mr. Sandeep Kasare who is the Power of Attorney holder of Ms. Anupma Agarwal (Ms. Anupma) the Erstwhile Director of Somerset Estate Private Limited (Corporate Debtor). The registry of this Appellate Tribunal marked the defects on 12.04.2024. As per Rule 26(2) of NCLAT Rules, 2016, seven days are prescribed for refiling of the Appeal from the date when the registry intimates the defects to the Appellant. The relevant provisions are as extracted below:

We find that the Appellant in IA No. 616/2025 filed the Appeal on 06.04.2024. Subsequently, on 12.04.2024 certain defects were pointed out by the Registry. We note that on 10.05.2024 the father-in-law of Ms Anupama passed away and as contended since the father-in-law was managing all records pertaining to the Corporate Debtor and due to his demise, additional time was required to retrieve relevant documents which were in his possession. However, we find the Appellant has failed to offer any explanation for the delay of 27 days in refiling, i.e, for the period between 12.04.2024, when the defects were notified on 09.05.2024. Further we don’t find any defect sheet on record with IA No. 616/2025 to substantiate or clarify the nature of the defects pointed out by the Registry. Furthermore, Appellant has not explained which defects required the assistance of Ms Anupama or her father-in-law. When the Appeal was listed for the second time on 04.02.2025, this Appellate Tribunal issued notice without condoning the delay, as IA No. 616/2025 was never placed before us by the Appellant. It appears that Application for condonation of the delay could not be considered and was taken up when the Respondent raised it. Thereafter, Respondent No. 2 filed an Application for recall of the Order dated 04.02.2025 on 01.04.2025, which was allowed on 16.04.2025. The Appellant should have brought IA No. 616/2025 to the notice of this Appellate Tribunal and deliberately sought to proceed with the Appeal without obtaining condonation of 280 days delay. In the present case, the Appellant took 280 days in refiling the Appeal. Basis the material placed on record and also oral and written submissions, the Appellant claims that the reason for delay in refiling was due to the death of her father-in-law of the Appellant under whose possession the documents of the entire Appeal were there, which took time to procure in order to clear the defects. Having gone through the submissions of both the parties, we do not find the explanation to be sufficient and justifiable for condonation of delay in refiling the Appeal. The Appellant has been very casual and not pursued it for very long period and the defects remained pending. If the Appellant was serious, he could have pursued the matter with the registry in curing the defects and in case they were not getting cured, the appellant could have mentioned it before this Tribunal. We find that none of this was done. The Appellant places its reliance on various judgments. None of them are applicable in the facts and circumstances of the case.

Appellant has failed to establish any sufficient or justifiable cause for the inordinate delay of 280 days in refiling the Appeal. The explanation offered that Ms Anupama, a shareholder of the Corporate Debtor was unable to provide the relevant documents as the records were managed by her father-in-law is vague, unsubstantiated and lacks any evidentiary support. Such a contention is devoid of merit and cannot be accepted as a valid ground for condonation of delay. Furthermore, Corporate Insolvency Resolution Process is a time-bound mechanism under the IBC and an inordinate delay of 280 days without any justifiable cause undermines the objective of expeditious resolution and serves only as an impediment to the statutory timelines prescribed under the Code.

In the facts and circumstances and also bases the legal position we find that there is no sufficient cause to condone the delay in refiling for 280 days. Insolvency Resolution is a time bound process and such laxity in pursuing the Appeal is not understandable. Therefore, the Application for condonation of delay is dismissed. Consequently, memo of Appeal is also dismissed.