A RAJENDRA VS GONUGUNTA MADHUSUDHAN RAO & ORS : CASE SUMMARY
The Supreme Court reiterated in A Rajendra Vs Gonugunta Madhusudan Rao Civil Appeal No. 11070-11071 of 2024 that litigant has to file its appeal under Section 61(2) within 30 days which can be extended up to a period of 15 days, and no more, upon showing sufficient cause.
BRIEF FACTS
The Appellant has filed application before NCLT seeking direction to place his Resolution Plan for consideration before CoC and stay on voting results on resolution Plan, which was dismissed by the NCLT on 20.07.2023 of which free certified copy was made available on 01.08.2023. Respondent has filed application for approval of Resolution Plan, which was also approved on 20.07.2023. The Appellants filed appeals before the NCLAT against both orders on 28th August, 2023. First Appeal was filed with free certified copy and in the second appeal, application for exemption from certified copy was filed. Initially no applications for condonation of delay were filed but they were filed after objections were raised by Respondents. The appeals were dismissed on ground of limitation.
FINDINGS OF THE SUPREME COURT
The Supreme Court observed that statutory time limit of 30 days within which an appeal can be preferred has been provided for in sub-section (2) of Section 61 of IBC. Proviso thereto allows an additional period of 15 days to file an appeal only on the satisfaction of NCLAT that there was sufficient cause for not filing the appeal earlier within the initial period of 30 days. The restrictions with regard to allowing extension in the provisions stipulated is cloaked in such a manner that the provisions have to be strictly followed. The first aspect is that the period is extendable by 15 days and not beyond that. The limit, therefore, has been prescribed as regards the period within which the discretion has to be applied by NCLAT. That apart, this period cannot be claimed as a matter of right for extension of the limitation rather it is laced with the satisfaction at the end of the NCLAT upon having shown sufficient cause. The discretion, therefore, has further been circumscribed and not merely left at the whims and fancy of NCLAT. The cumulative reading of the proviso would therefore entail that the extension of period so provided for has to be strictly construed and has not to be exercised in a liberal manner which highlights the legislative intent which has to be given effect to.
The Supreme Court noted that the incident which triggers limitation to commence is the date of pronouncement of the Order and in case of non-pronouncement of the Order when the hearing concludes, the date on which the Order is pronounced or uploaded on the website. However, where the judgment was pronounced in open Court, the period of limitation starts running from that very day. The appellant is however entitled to seek relief under Section 12(2) of the Limitation Act for excluding the period during which the certified copy was under preparation on an application preferred by that party.
The Supreme Court held that in the absence of any certified copy having been applied by the appellant of the impugned orders dated 20th July 2023 passed by the NCLT on which it was admittedly pronounced, with Rule 22 of the NCLAT Rules mandating filing of the appeal along with the certified copy. The appeals as preferred by the appellant need to be dismissed as they were filed beyond 30 days and no steps have been taken by the appellant to seek certified copy of the order.
The Supreme Court affirmed the decision of NCLAT and dismissed the appeal.
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Mukesh Kumar Suman is an advocate and legal author based at Delhi. He regularly appears before various Judicial Forums including NCLT, NCLAT, High Courts and the Supreme Court. He can be approached at mukesh_suman@outlook.com or +91 9717864570.
