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Sagufa Ahmed vs Upper Assam Plywood Products Pvt. - (Supreme Court) (18 Sep 2020)

NCLAT is empowered to condone the delay upto a period of 45 days

MANU/SC/0697/2020

Limitation

The Appellants have come up with the present appeals, challenging an order passed by the National Company Law Appellate Tribunal (‘NCLAT’) dismissing an application for condonation of delay as well as an appeal as time barred. The Appellants claim to hold 24.89% of the shares of a company by name Upper Assam Plywood Products Private Limited, which is the first Respondent herein. The Appellants moved an application before the Guwahati Bench of the National Company Law Tribunal (‘NCLT’) for the winding up of the company. The said petition was dismissed by the NCLT by an order.

The contentions raised by the learned counsel for the Appellants are two¬fold namely (i) that the Appellate Tribunal erred in computing the period of limitation from the date of the order of the NCLT, contrary to Section 421(3) of the Companies Act, 2013, and (ii) that the Appellate Tribunal failed to take note of the lockdown as well as the order passed by this Court on 23rd March, 2020 in Suo Motu Writ Petition, extending the period of limitation for filing any proceeding with effect from 15th March, 2020 until further orders.

Rule 50 of the National Company Law Tribunal Rules, 2016 also mandates the Registry of the NCLT to send a certified copy of the final order to the parties concerned free of cost. Section 421(1) of Act, provides for a remedy of appeal to the Appellate Tribunal as against an order of NCLT. Sub¬-Section (3) of Section 421 of Act, prescribes the period of limitation for filing an appeal and the proviso thereunder confers a limited discretion upon the Appellate Tribunal to condone the delay.

Therefore, it is true, as contended by the Appellants, that the period of limitation of 45 days prescribed in Section 421(3) of Act, would start running only from the date on which a copy of the order of the Tribunal is made available to the person aggrieved. Under Section 420(3) of the Act read with Rule 50, the Appellants were entitled to be furnished with a certified copy of the order free of cost.

From 19th December, 2019, the date on which the counsel for the Appellants received the copy of the order, the Appellants had a period of 45 days to file an appeal. This period expired on 2nd February, 2020. By virtue of the proviso to Section 421(3) of Act, the Appellate Tribunal was empowered to condone the delay upto a period of period of 45 days. This period of 45 days started running from 2nd February, 2020 and it expired even according to the Appellants on 18th March, 2020. The Appellants did not file the appeal on or before 18th March, 2020, but filed it on 20th July, 2020. It is relevant to note that, the lock down was imposed only on 24.03.2020 and there was no impediment for the Appellants to file the appeal on or before 18th March, 2020.

The Appellants cannot take refuge under the order dated 23rd March, 2020. Extension by Order dated 23rd March, 2020 of this Court was only “the period of limitation” and not the period upto which delay can be condoned in exercise of discretion conferred by the statute. The above order passed by this Court was intended to benefit vigilant litigants who were prevented due to the pandemic and the lockdown, from initiating proceedings within the period of limitation prescribed by general or special law. Therefore, the expression “prescribed period” appearing in Section 4 of the Limitation Act, 1963 cannot be construed to mean anything other than the period of limitation. Any period beyond the prescribed period, during which the Court or Tribunal has the discretion to allow a person to institute the proceedings, cannot be taken to be “prescribed period”. Therefore, the Appellants cannot claim the benefit of the order passed by this Court on 23rd March, 2020, for enlarging, even the period up to which delay can be condoned. The second contention is thus, untenable. Appeals dismissed.

Tags : PRESCRIBED PERIOD   DELAY   CONDONATION  

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