Supreme Court Reiterates, “Vigilantibus Non Dormientibus Jura Subveniunt”

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Introduction

An appeal from the order of any court needs to be filed before the appellate tribunal or court during the prescribed period. An application for condonation of delay is allowed if the delay in filing the appeal is within the period up to which the delay can be condoned. However, if it is filed beyond the same, it cannot be condoned by the appellate body. In casu¸ the Appellant sought to take refuge under the Order dated 23.03.2020 of the Supreme Court wherein the period of limitation stood extended w.e.f. 15.03.2020.

Brief Facts

The Appeal arises out of an order passed by the National Company Law Appellate Tribunal (“NCLAT”). The Appellants hold 24.89% shares of the Respondent Company. The Appellant had moved an application for winding up of the Respondent Company before the NCLT, Guwahati Bench. The same was dismissed on 25.10.2019. The Appellant appealed before the NCLAT on 20.07.2020. The NCLAT dismissed the application on the ground of delay. Hence, the present appeal before the Supreme Court.

Appellant’s Arguments

It has been submitted by the Appellant that the NCLAT erred in computing the period of limitation contrary to Sec. 421(3) of the Companies Act, 2013. Secondly, that the NCLAT failed to take note of the lockdown imposed in view of the Corona Pandemic. 

Court’s View

The Court referred to Sec. 420(3) which mandates the NCLT to send a copy of its order to all parties concerned. Additionally, Rule 50 of the NCLT Rules, 2016 requires the Registry of the NCLT to send a certified copy of the final order free of cost. With respect to the appeal from the order of the NCLT, Sec. 421(3) grants discretion on the NCLAT to condone the delay. The Court accepted the contention of the Appellant that the period of limitation would start from the day of receipt of the certified copies of the NCLT order. It further observed that the Appellant would be perfectly justified in waiting for a certified copy as per Rule 50 of the NCLT Rules.

However, in the instant appeal, the Court observed that an application to obtain certified copies of the Order was made by the Appellant. A certified copy of the Order was obtained on 19.12.2019. Hence the period to make an appeal ended on 02.02.2020. Additionally, as per Sec. 241(3) of the Companies Act, 2013, the NCLAT is empowered to condone delay for a period of 45 days. In this case, that expired on 18.03.2020. However, the appeal was filed on 20.07.2020. The Appellant placed reliance on Suo Motu Writ Petition (Civil) No. 3 of 2020. Wherein, the Supreme Court, in view of the difficulties caused by Covid-19, extended the period of limitation w.e.f. 15.03.2020.

The Court, however, observed that the Appellant could not take refuge under the Order in Suo Motu Writ Petition (Civil) No. 3 of 2020. It was observed that “What was extended by the above order of this Court was only “the period of limitation” and not the period up to which delay can be condoned in exercise of the discretion conferred by the statute”.

The Court further referred to Assam Urban Water Supply and Sewerage Board v. Subash Projects and Marketing Limited, (2012) 2 SCC 624. Therein the Court examined the phrase “prescribed period”. It was observed that the period of 30 days mentioned in the proviso to Sec. 34(3) of the Arbitration and Conciliation Act, 1996 is not the ‘prescribed period’. 

Court’s Decision

The Court dismissed the appeal and held that the Appellants cannot benefit from the Order of the Supreme Court of 23.03.2020 for enlarging the period up to which delay can be condoned.


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