Read Judgment: National Spot Exchange Limited vs. Mr. Anil Kohli, Resolution Professional For Dunar Foods Limited

Pankaj Bajpai

New Delhi, September 15, 2021: In view of the specific statutory provision contained in Section 61(2) of the Insolvency & Bankruptcy Code (IBC), the Supreme Court has observed that the NCLAT committed no error in dismissing the appeal on the ground of limitation by observing that it had no jurisdiction and/or power to condone the delay exceeding 15 days.

Considering the statutory provisions which provide that delay beyond 15 days in preferring the appeal is uncondonable, a Division Bench of Justice M.R. Shah and Justice Aniruddha Bose ruled that NCLAT has no jurisdiction and/or power to condone the delay exceeding 15 days.

While refusing to accept the contention of the appellant’s counsel for condonation of delay, the Division Bench said that what cannot be done directly considering the statutory provisions, cannot be permitted to be done indirectly, while exercising the powers under Article 142 of the Constitution of India.

The Top Court observed that there may arise a situation where the applicant/appellant may not be in a position to file the appeal even within a statutory period of limitation prescribed under the Act and even within the extended maximum period of appeal which could be condoned owing to genuineness, viz., illness, accident etc.

However, under the statute, the Parliament has not carved out any exception of such a situation. Therefore, in a given case, it may cause hardship, however, unless the Parliament has carved out any exception by a provision of law, the period of limitation has to be given effect to. Such powers are only with the Parliament and the legislature, added the Court.

While reiterating that courts have no jurisdiction and/or authority to carve out any exception, the Division Bench opined that if the courts carve out an exception, it would amount to legislate which would in turn might be inserting the provision to the statute, which is not permissible.

The Top court noted that the appellant has challenged the order passed by the adjudicating authority affirming the decision of the resolution professional of rejection of the claim of the appellant before the NCLAT.

Observing that the appeal preferred before the NCLAT was u/s 61(2) of the IB Code, the Top Court said that as per Section 61(2) of the IB Code, the appeal was required to be preferred within a period of thirty days. Therefore, the limitation period prescribed to prefer an appeal was 30 days.

However, as per the proviso to Section 61(2) of the Code, the Appellate Tribunal may allow an appeal to be filed after the expiry of the said period of 30 days if it is satisfied that there was sufficient cause for not filing the appeal, but such period shall not exceed 15 days, added the Court.

Therefore, the Apex Court concluded that the Appellate Tribunal has no jurisdiction at all to condone the delay exceeding 15 days from the period of 30 days, as contemplated u/s 61(2) of the IB Code.

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