When Order Passed In Presence Of Both Parties' Counsels, Limitation To File Appeal Commences From Date Of Order: NCLAT Delhi

Section 12(2) of the Limitation Act, 1963 states that while computing limitation for filing an appeal, review or revision, the date on which the judgment was pronounced and the time taken to obtain copy of the judgment shall be excluded.

The Bench opined that when NCLT passes an order, the party is obligated to apply for certified copy to seek benefit of Section 12 of Limitation Act. Since the Appellant applied for certified copy after 30 days of passing of order, the Bench declined to exclude the period from computation of limitation.

BACKGROUND FACTS

Puranik Builders Ltd. (“Respondent”) filed a petition under Section 9 of IBC before NCLT, seeking initiation of Corporate Insolvency Resolution Process (“CIRP”) against Supreme Construction Developers Pvt. Ltd. (“Appellant”).

On 09.10.2023, the NCLT adjourned the hearing of matter in view of request made by the Respondent. The Appellant filed an application before NCLT seeking recall of order dated 09.10.2023. Thereafter, on 07.11.2023 the NCLT dismissed the recall application in the presence of counsels of both the parties.

The Section 61(2) of IBC provides a period of 30 days for filing an appeal against the order of NCLT. The Proviso to Section 61(2) of IBC states that NCLAT may allow an appeal beyond 30 days, by a maximum of fifteen days, on demonstration of sufficient cause for the delay.

The order dated 07.11.2023 was uploaded on the NCLT website on 19.12.2023. The Appellant applied for certified copy on 19.12.2023 and received it on 20.12.2023.

On 06.01.2024, the Appellant e-filed an appeal before the NCLAT against the order dated 07.11.2023. An application for condonation of delay was also filed by Appellant, contending that the limitation would commence from the date on which the order was uploaded i.e. on 19.12.2023.

The Respondent contended that the order dated 07.11.2023 was passed in presence of Counsel for the Appellant. Hence, the date of uploading of the order is not relevant. Limitation for filing of the Appeal shall commence from the date when order was passed.

NCLAT VERDICT

The Bench perused the order dated 07.11.2023 wherein the appearance of counsel of both the parties were recorded. It was opined that when the order has been passed in presence of both the counsels, then the Appellant cannot claim that it was unaware of the order.

“When the order is passed in presence of both the counsel, Appellant cannot contend that he was not aware of the order passed moreso, when the order was dismissing IA filed by the Appellant himself.”

Further, the Appellant filed the application for certified copy of the order on 19.12.2023, which was beyond period of 30 days from the date of passing of order. Therefore, the benefit of Section 12 of the Limitation Act, wherein time taken in obtaining certified copy can be excluded, cannot be claimed by the Appellant.

“Thus, certified copy was applied by the Appellant after 30 days. When an order is passed by the Adjudicating Authority it casts an obligation on the party to apply for certified copy if the benefit under Section 12 of the Limitation Act are sought to be claimed and party intent to file an appeal.”

The Bench opined that the date of uploading the order was inconsequential since it is not the case of Appellant that no order was passed on 07.11.2023.

“There are no averments in the application that no order was passed on 07.11.2023 by the Court. Appellant sought to rely on date of uploading of the order which may not help the Appellant in the present case. As noticed above, the order was passed in presence of both the parties whose presence are noted in the order. We, thus, are of the view that the limitation to file an appeal shall commence from 07.11.2023 and the Appeal having been filed beyond 15 days after expiry of the limitation, delay cannot be condoned. Our jurisdiction to condone the delay is limited to only 15 days by Section 61(2) proviso.”

The Bench concluded that that an order is passed in presence of counsels of both the parties, then the parties cannot claim that they were unaware of the order. Accordingly, it has been held that the limitation to file appeal would commence from the date of passing of order and not the date of on which it was uploaded. Further, since the appeal has been filed beyond the period of 15 days after expiry of limitation of 30 days, the Bench declined to condone the delay. The appeal has been dismissed.

Case title: Supreme Construction Developers Pvt. Ltd. v Puranik Builders Ltd.

Case No.: Company Appeal (AT) (Insolvency) No. 215 of 2024.

Counsel for Respondents: Mr. Krishnendu Datta, Sr. Advocate with Mr. Anish Agarwal, Mr. Tejas Agarwal and Mr. Pratik Kr. Chakma, Advocates.

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