Pranav B Prem

The National Company Law Appellate Tribunal (NCLAT), New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member), has held that the delay in filing appeals is condonable when the composite appeal was originally filed within the limitation period but was subsequently refiled separately after the registry raised objections. The bench observed that since the original composite appeal was filed within the statutory limitation period of 30 days, and the subsequent refiling arose only due to technical objections by the registry, such refiling could not be treated as a fresh appeal beyond limitation.

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Background

The appellant had filed a single composite appeal challenging two separate orders passed by the National Company Law Tribunal (NCLT) within the prescribed limitation period. However, the registry of the Appellate Tribunal raised an objection that two distinct orders could not be challenged in one composite appeal. Following this, the appellant withdrew the composite appeal and filed two separate appeals as per the registry’s direction. These separate appeals were filed beyond the 45-day period prescribed under Section 61(2) of the Insolvency and Bankruptcy Code (IBC). The appellant simultaneously filed an affidavit seeking condonation of delay, contending that the original composite appeal was filed within limitation and that the subsequent refiling was a procedural correction, not a fresh cause of delay.

Contentions

The appellant argued that since the initial composite appeal was filed within the limitation period, the time taken in refiling separate appeals after curing defects should not be construed as delay. It was further submitted that the right to appeal had been duly exercised within the statutory time frame and that the registry’s objection was a procedural aspect.

The respondent, however, opposed the plea, contending that under the proviso to Section 61(2) of the IBC, the Tribunal can condone delay only up to 15 days beyond the initial 30 days. Since the second set of appeals was filed beyond this extended period, they argued that the Tribunal lacked jurisdiction to condone the delay.

Findings of the Tribunal

The NCLAT noted that the original composite appeal had been filed well within the 30-day limitation period. The refiling of separate appeals was only necessitated due to the registry’s objection that a single appeal could not challenge multiple orders. The bench observed: “It cannot be said that the appellant had not filed the appeal within limitation. The first filing was within time, and the subsequent refiling of separate appeals after withdrawal of the composite appeal was in compliance with the registry’s direction.”  Holding that the appeal had been originally filed within time, the Tribunal accepted the appellant’s explanation and condoned the delay. It emphasized that the delay was procedural and bona fide, and not one of inaction or negligence.

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Allowing the appeal, the NCLAT held that the period of limitation should be reckoned from the date of the original composite appeal, and not from the date of refiling separate appeals. The Tribunal thus condoned the delay and directed that the appeals be heard on merits. “Since the appellant had exercised the right to appeal within the prescribed time and only refiled separately due to registry’s procedural objection, the delay deserves to be condoned,” the Tribunal concluded.

Appearance

For Appellant: Mr. Krishnendu Datta, Sr. Advocate, with Mr. Gaurav H. Sethi, Mr. Rahul Pawar, and Mr. Rahul Kapoor, Advocates.

For Respondent: Mr. Piyush Swami, Adv. Rony O John, Mr. Deep Roy, Adv. Bhavit Baxi, and Adv. Rishi B., Advocates for R2. Mr. Gokula Krishnan, Advocate.

Cause Title: Anup Kumar Singh v. Annapoorani Textiles Pvt. Ltd.

Case No: Comp. App. (AT) (Ins) No. 911 of 2024

Coram: Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member)