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2023 (5) TMI 901

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....2022, the appellant filed an application for obtaining a certified copy of the order which was pronounced by the NCLT. The application was received by the Registry of NCLT on 5 September 2022. On 15 September 2022, the order was uploaded on the website of the NCLT and a certified copy was provided to the appellant on the same day. The appellant lodged an appeal before the NCLAT on 10 October 2022 in the e-filing mode along with an Interlocutory Application ["IA"] seeking condonation of delay of five days. A physical copy of the appeal was filed on 31 October 2022. 4. The appellant submitted that the appeal had been filed within the period of limitation from the date the order was made available in the public domain i.e., 15 September 2022. However, as a matter of abundant precaution, the appellant had considered 26 August 2022 to be the date from which limitation would commence. The appellant stated that the prescribed time period of 30 days for filing the appeal ended on 5 October 2022, after accounting for the exclusion of 10 days (from 5 September 2022 to 15 September 2022 on account of the time taken to provide a certified copy). The appellant submitted that the inadvertent de....

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....s barred by limitation on the ground that it was instituted on the 46th day following the order of the NCLT, exceeding the outer limit of 45 days that was permissible under Section 61 of the IBC. 8. The appellant questions the order of the NCLAT on limitation. 9. The following submissions have been urged by Mr Bhanu Gupta, counsel appearing on behalf of the appellant: i. The NCLAT ought to have excluded the period from 5 September 2022, when an application for obtaining a certified copy was filed till 15 September 2022, when the certified copy was received, while computing the period of limitation; ii. The NCLAT has erroneously taken the entire period between 26 August 2022 and 10 October 2022 by failing to exclude the date on which the order was pronounced, namely, 26 August 2022 in terms of Section 12(2) of the Limitation Act 1963 and Rule 3 of the National Company Law Appellate Tribunal Rules 2016 ["NCLAT Rules 2016"]; iii. The NCLAT has disregarded judicial precedents including the judgment of this Court in V Nagarajan v. SKS Ispat and Power Limited & Ors (2022) 2 SCC 244 ("V Nagarajan"); and iv. Since the order of the NCLT was uploaded on the website on 15 Septemb....

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.... anything to the contrary contained under the Companies Act, 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. [...]" Sub-Section (2) of Section 61 provides for a limitation period of thirty days. The proviso to Section 61(2) provides that NCLAT may allow an appeal to be filed beyond a period of thirty days by a maximum of fifteen days on the demonstration of sufficient cause for the delay. 13. Section 238A, inserted in the IBC by the Insolvency and Bankruptcy Code (Second Amendment) Act 2018 [The Insolvency and Bankruptcy Code (Second Amendment) Act 2018, Act No. 26 of 2018 the impugned order.], contains a specific provision in regard to the Limitation Act 1963. Section 238A provides....

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....e or his advocate or authorised representative. (6) The processing fee prescribed by the rules, with required number of envelopes of sufficient size and notice forms as prescribed shall be filled along with memorandum of appeal." 16. In terms of Rule 103, the Appellate Tribunal may allow the filing of an appeal or proceedings through electronic mode. Rule 103 provides that: "103. Filling through electronic media- The Appellate Tribunal may allow filing of appeal or proceedings through electronic mode such as online filing and provide for rectification of defects by e-mail or internet and in such filing, these rules shall be adopted as nearly as possible on and form a date to be notified separately and the Central Government may issue instructions in this behalf from time to time." 17. On 3 January 2021, NCLAT notified a Revised SOP for the hearing of cases through the virtual mode, using its e-filing portal. The SOP notices that an e-filing facility was available for filing of appeals and related documents, and exhorts "all concerned" to "avail the same through NCLAT e-filing portal". The circular provides as follows: "It may be noted that it is mandatory that Ld. Advoca....

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....s to be computed with reference to the date of e-filing or from the date on which the appeal is presented before the NCLAT, in terms of Rule 22. Hence, in exercise of the power conferred by Rule 104, it was notified that the period of limitation would be computed with reference to the date of the presentation of the appeal in terms of Rule 22. Moreover, the requirement of filing appeals by the electronic mode was directed to continue together with the mandatory filing of appeals under Rule 22. The order dated 21 October 2022 was to be effective from 1 November 2022. 20. Eventually, on 24 December 2022, another order was issued by the Registrar of NCLAT in the following terms: "It is seen that appeals are e-filed from different parts of the country where the appellant in some cases is located in far away places and time is taken to file physical copy. It is further seen that physical copy is filed within seven days of e-filing. Hence, with regard to computation of limitation in Appeals, following directions are hereby issued by the Competent Authority: - (1) The order F.No.10/37/2018-NCLAT dated 21.10.2022 is hereby withdrawn and superseded by this order. (2) Limitation sha....

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....r dated 24 December 2022 now clarifies that limitation would be computed with effect from the date of e-filing but a physical copy would have to be filed within seven days of e-filing. 23. In the present case, the order was pronounced by the NCLT on 26 August 2022. Rule 3 of the NCLAT Rules 2016 stipulates that the date from which the period of limitation has to be reckoned (i.e., the date of the pronouncement of the order) would have to be excluded. Hence, the date on which the order was pronounced by the NCLT, namely 26 August 2022 would have to be excluded from the computation of limitation. This is in line with Section 12(1) of the Limitation Act 1963. As noted earlier, the provisions of the Limitation Act 1963 are made applicable, inter alia, to appeals before the NCLAT by virtue of Section 238A of the IBC. Section 12(1) of the Limitation Act 1963 provides as follows: "12. Exclusion of time in legal proceedings- (1) In computing the period of limitation for any suit, appeal or application, the day from which such period is to be reckoned, shall be excluded. [...]" 24. Between 26 August 2022, when the order was pronounced by the NCLT, and 10 October 2022, when the ap....

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....peal was barred by limitation as the appellant demonstrated no effort to secure a certified copy and only relied on the date of the uploading of the order of the website. This Court held that: 29. On the question of a certified copy for filing an appeal against an order passed by NCLT under IBC, Rule 22(2) of the NCLAT Rules mandates that an appeal has to be filed with a certified copy of the "impugned order" [...] Therefore, it cannot be said that the parties can automatically dispense with their obligation to apply for and obtain a certified copy for filing an appeal. Any delay in receipt of a certified copy, once an application has been filed, has been envisaged by the legislature and duly excluded to not cause any prejudice to a litigant's right to appeal. 30. [...] 31. The import of Section 12 of the Limitation Act and its Explanation is to assign the responsibility of applying for a certified copy of the order on a party. A person wishing to file an appeal is expected to file an application for a certified copy before the expiry of the limitation period, upon which the "time requisite" for obtaining a copy is to be excluded. However, the time taken by the court to....

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....cient and the delay should have been condoned within the four corners of the statute. 30. Before concluding, we cannot but fail to notice the flip-flops on the part of the NCLAT in providing administrative guidance on whether limitation would commence from the date of e-filing or from the presentation of the appeal at the filing counter. With technological advances, the country's judiciary and tribunals must move towards e-filing. This process has already commenced and is irreversible. The Union Government must have a fresh look at the rules to encourage e-filing across tribunals. Perhaps one way forward would be to constitute a Working Group to make a comprehensive assessment of the position across tribunals and suggest regulatory changes. Moreover, it is utterly incomprehensible why NCLAT should insist on physical filing in addition to e-filing. This unnecessarily burdens litigants and the Bar and is a disincentive for e-filing. A lawyer or litigant who is compelled to file physical copies in addition to e-filed documents will have no cogent reason to resort to e-filing. This duplication of effort is time consuming. It adds to expense. It leaves behind a carbon footprint which ....