When No Limitation Period Is Prescribed, Appeal Must Be Filed Within 'Reasonable Time' Depending Upon Facts Of Each Case: Supreme Court

The Supreme Court has held that when no limitation period has been prescribed for filing an appeal, then such appeal must be filed within a reasonable time, which is to be determined as per facts and circumstances of each case.

“In the absence of any particular period of time being prescribed to file an appeal, the same would be governed by the principle of 'reasonable time', for which, by virtue of its very nature, no straitjacket formula can be laid down and it is to be determined as per the facts and circumstances of each case.”

The Bench comprising Justice Abhay S. Oka and Justice Sanjay Karol, has held that, “When no limitation stands prescribed it would be inappropriate for a Court to supplant the legislature' s wisdom by its own and provide a limitation, more so in accordance with what it believes to be the appropriate period”.

BACKGROUND FACTS

M/S North Eastern Chemicals Industries (P) Ltd. (“Appellant”) supplied goods to M/S Ashok Paper Mill (Assam) Ltd. and another (“Respondents”), but the latter only made part payment.

Subsequently, the Respondents were declared “a sick company” under the Sick Industrial Companies (Special Provisions) Act, 1935. For the rejuvenation of the industry, the Government of Assam promulgated the Jogighopa (Assam) Unit of Ashok Paper Mills Limited (Acquisition Transfer of Undertaking) Act, 1990 (“Jogighopa Act”).

The Appellant filed its claim under Section 16 of Jogighopa Act for Rs. 1,58,375/- along with interest. The Commissioner of Payments awarded the principle sum but no interest to the Appellant. When the Appellants approached the High Court, the High Court held that the interest would accrue from 23.09.1992, as the 'Interest on Delayed Payments to Small-Scale and Ancillary Industrial Undertaking Act 1993' was brought into force on such date. The Commissioner vide an order dated 13.04.2005 held that no further funds were payable to the Appellants.

The Appellants filed an appeal before the District Judge under Section 22(8) of Jogighopa Act, alongwith an application under Section 5 of Limitation Act, 1963 for condonation of delay. On 14.05.2009, the District Judge admitted the appeal and held that no specific time has been provided for preferring an Appeal before the Principal Civil Court after being dissatisfied with the Commissioner's decision.

The Respondents filed a Civil Rweview against the order dated 14.05.2009 before the High Court and the same was allowed. The High Court held that the Appeal was erroneously admitted by the District Judge and the same deserves to be dismissed for being barred by limitation.

The Appellant challenged the High Court's order before the Supreme Court.

SUPREME COURT VERDICT

The issue before the bench as whether in the absence of prescribed limitation, can an appeal from an order of Commissioner of Payments be entertained irrespective of passage of time.

Reliance was placed on the Supreme Court judgment in Ajaib Singh v. Sirhind Coop. Marketing-cum-Processing Service Society Ltd., (1999) 6 SCC 82, wherein it was held that Courts should be wary of prescribing specific period of limitation in cases where the legislature has refrained from doing so. Further, in absence of a specific limitation it would be improper for courts to dismiss a plea is solely on the ground of delay without having examined the nature of laws order prejudice caused to the other party in the facts and circumstances of the case at hand. The holding in Ajaib Singh was affirmed by a three-Judge Bench of the Supreme Court in Purohit & Co. v. Khatoonbee, (2017) 4 SCC 783.

It was observed that when no limitation stands provided either by specific applicability of the Limitation Act or the special statute governing the dispute, then the Court must undertake a holistic assessment of the facts and circumstances of the case to examine the possibility of delay causing prejudice to a party.

The Bench elucidated the factors to be taken in consideration by the Court in cases where no limitation has been prescribed:

“A court should, in such a situation consider in the facts and circumstances of the case at hand, the conduct of the parties, the nature of the proceeding, the length of delay, the possibility of prejudice being caused, and the scheme of the statute in question. It may be underscored here that when a party to a dispute raises a plea of delay despite no specific period being prescribed in the statute, such a party also bears the burden of demonstrating how the delay in itself would cause the party additional prejudice or loss as opposed to, the claim subject matter of dispute, being raised at an earlier point in time.”

Further, in cases where no limitation is prescribed, the parties are not allowed to litigate decades later. However, shorter delays in initiating litigation would not attract delay and laches.

“When a statute, either general or specific in application, provides for a limitation within which to file an appeal, the parties interested in doing so are put to notice of the requirement to act with expedition. However, opposite thereto, in cases such as the present one where neither statute provides for an explicit limitation, such urgency may be absent. While it is still true that, as held in Ajaib (supra), this does not entitle parties to litigate issues decades later, however shorter delays, in such circumstances, would not attract delay and laches.”

It was held that the appeal filed by the Appellant from an order of the Commissioner of Payments was maintainable, since neither the general nor the specific statute provided a time frame for filing such appeal.

The appeal has been allowed.

Case Title: M/S North Eastern Chemicals Industries (P) Ltd.& Anr. V M/S Ashok Paper Mill (Assam) Ltd. & Anr.

Citation:  2023 LveLaw (SC) 1064

Counsel for Appellant: Sr. Adv. Parthiv K Goswami

Counsel for Respondent: Sr. Adv. Rajshekhar Rao

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