EXIDE INDUSTRIES LTD. v. Jitender Kumar Jain ..., National Company Law Appellate Tribunal, Judgment, Law, casemine.com

Citation Codes

Equivalent Citations

citation codes

Case Number

IA - 3522/2022

Disposition

dismissed

Advocates

Dhaval Deshpande

Judges

Justice Ashok Bhushan (Chairperson) Hon'ble Mr. Barun Mitra (Member (Technical)) Hon'ble Dr. Alok Srivastava (Member (Technical))

Acts

SECTION 421 COMPANIES ACT
SECTION 420 COMPANIES ACT 2013
Rule 22(2) of the NCLAT Rules. Section 12(2) of the Limitation Act

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Smart Summary

Factual and Procedural Background

This opinion addresses an appeal filed by Exide Industries Ltd. against an order dated 06th July, 2022. The appeal was e-filed on 30th August, 2022, and the physical copy was filed on 05th September, 2022, resulting in a delay in filing. An application for condonation of delay (I.A. No. 3522 of 2022) along with an additional affidavit was filed to seek extension of the limitation period.

Legal Issues Presented

Whether the limitation period for filing an appeal under the Insolvency and Bankruptcy Code (IBC) begins from the date of pronouncement of the order or from the date of receipt of a certified copy of the order.
Whether delay in filing the appeal beyond the prescribed limitation period can be condoned beyond 15 days under Section 61(2) proviso of the IBC.

Arguments of the Parties

Appellant's Arguments

The appellant submitted that they received a free certified copy of the impugned order on 27th July, 2022, and filed the appeal within one month thereafter.

Respondent's Arguments

The respondent relied on the Supreme Court judgment in V Nagarajan Vs. SKS Ispat and Power Ltd. [(2022) 2 SCC 244], emphasizing that the limitation period runs from the date the order is pronounced, not from the date of receipt of the certified copy.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
V Nagarajan Vs. SKS Ispat and Power Ltd. [(2022) 2 SCC 244]	Clarification that limitation period under the IBC begins from the date of pronouncement of the order and not from the date of receipt of the certified copy. The requirement of annexing a certified copy is not mandatory to start limitation. Delay condonation is limited to 15 days under Section 61(2) proviso.	The court applied this precedent to hold that the limitation period for filing the appeal started when the order was pronounced. The appellant's delay exceeded the permissible 15 days for condonation, leading to dismissal of the delay condonation application and rejection of the appeal.

Court's Reasoning and Analysis

The court analyzed the limitation period for filing appeals under the Insolvency and Bankruptcy Code by referring to the Supreme Court's ruling in V Nagarajan Vs. SKS Ispat and Power Ltd.. It observed that the IBC, being a self-contained code with overriding effect, prescribes that limitation begins from the date the order is pronounced, not from when a certified copy is received. The court emphasized that allowing the limitation period to be computed from receipt of a free certified copy would undermine the timely resolution framework of the IBC. Furthermore, the jurisdiction to condone delay is strictly limited to 15 days under Section 61(2) proviso. Since the appellant's delay exceeded this period, the application for condonation was rightly dismissed.

Holding and Implications

The court dismissed the application for condonation of delay and rejected the appeal due to delay exceeding the permissible limit under the IBC.

The direct consequence of this decision is that the appellant’s appeal was not admitted due to delay beyond the 15-day condonation limit. No broader precedent was established beyond affirming the strict application of limitation periods under the IBC as clarified by the Supreme Court.

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EXIDE INDUSTRIES LTD. v. Jitender Kumar Jain Resolution Professional of Morakhia Copper & Alloys Private Limited

NATIONAL COMPANY LAW APPELLATE TRIBUNAL

PRINCIPAL BENCH, NEW DELHI

Company Appeal (AT) (Insolvency) No. 1169 of 2022 &

I.A. No. 3522 of 2022

IN THE MATTER OF:

Exide Industries Ltd. …Appellant Versus

Jitender Kumar Jain, …Respondent Resolution Professional of Morakhia Copper & Alloys Pvt. Ltd.

Present:

For Appellant: Mr. Amar Dave, Mr. Dhaval Deshpande, Advocates

For Respondent: Mr. Ravinder Kr. Rawat, Advocate

O R D E R

12.10.2022: Heard Learned Counsel for the Appellant and Learned Counsel for the Respondent.

2. This Appeal has been filed against the Order dated 06^thJuly, 2022. This Appeal was e-filed on 30^thAugust, 2022 and Physical Copy of Appeal was filed on 05^thSeptember, 2022. There is delay in filing the Appeal.

3. Application for condonation of delay (I.A. No. 3522 of 2022) as well as Additional Affidavit has been filed.

4. Learned Counsel for the Appellant submits that Appellant received a free certified copy of the Impugned Order on 27^thJuly, 2022 and thereafter the Appeal was filed within one month.

5. Learned Counsel for the Respondent has rightly placed reliance on the Judgement of Hon'ble Supreme Court in the matter of "V Nagarajan Vs. SKS

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Ispat and Power Ltd." [(2022) 2 SCC 244] decided on 22^ndOctober, 2021. In paragraph 21 of the Judgement, Hon'ble Supreme Court laid down following:

"33. The answer to the two issues set out in Section C of the judgement- (i) when will the clock for calculating the limitation period run for proceedings under the IBC; and (ii) is the annexation of a certified copy mandatory for an appeal to the NCLAT against an order passed under the IBC - must be based on a harmonious interpretation of the applicable legal regime, given that the IBC is a Code in itself and has overriding effect. Sections 61(1) and (2) of the IBC consciously omit the requirement of limitation being computed from when the "order is made available to the aggrieved party", in contradistinction to Section 421(3) of the Companies Act. Owing to the special nature of the IBC, the aggrieved party is expected to exercise due diligence and apply for a certified copy upon pronouncement of the order it seeks to assail, in consonance with the requirements of Rule 22(2) of the NCLAT Rules. Section 12(2) of the Limitation Act allows for an exclusion of the time requisite for obtaining a copy of the decree or order appealed against. It is not open to a person aggrieved by an order under the IBC to await the receipt of a free certified copy under Section 420(3) of the Companies Act 2013 read with Rule 50 of the NCLT and prevent limitation from running. Accepting such a construction will upset the timely framework of the IBC. The litigant has to file its appeal within thirty days, which can be extended up to a period of fifteen days, and no more, upon showing sufficient cause. A sleight of interpretation of procedural rules cannot be used to

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defeat the substantive objective of a legislation that has an impact on the economic health of a nation."

6. In view of the law laid down by the Hon'ble Supreme Court, the limitation for filing the Appeal begins when order was pronounced. The mere fact that Appellant received free certified copy of the Impugned Order on 27^th July, 2022, the period of limitation shall not stop running after passing of the order/judgment. Our jurisdiction to condone the delay is only limited to 15 days under Section 61(2) proviso. There being delay of more than 15 days, the Delay Condonation Application cannot be allowed. Application is dismissed. Consequently, the Memo of Appeal is rejected.

[Justice Ashok Bhushan] Chairperson

[Dr. Alok Srivastava] Member (Technical) [Mr. Barun Mitra] Member (Technical)

Basant/nn

EXIDE INDUSTRIES LTD. v. Jitender Kumar Jain ...