Col. Ashish Khanna vs Delhi Gymkhana Club Limited on 21 October, 2024

[Cites 20, Cited by 0]

National Company Law Appellate Tribunal

Col. Ashish Khanna vs Delhi Gymkhana Club Limited on 21 October, 2024

IA No.5502 of 2024 is an application praying for condonation of 68 days' delay in filing the Appeal against the order dated 15.12.2023 in Company Application No.440/PB/2022 passed by the National Company Law Tribunal, Principal Bench, New Delhi. In Company Petition No.71/(ND)/2020, the NCLT vide order dated 15.12.2023 has dismissed CA No.440/PB/2022 filed by the Appellant with cost of Rs.50,000/- on the Applicant to be deposited to Prime Minister National Relief Fund within seven days of the order.

2. Brief facts of the case and sequence of the events for deciding IA No. 5502 of 2024 are:

2.1. Company Petition No.71/ (ND)/2020 was filed by the Union of India under Sections 241 and 242 of the Companies Act, 2013 arraying the Delhi Gymkhana Club Ltd. as Respondent No.1. In the said petition, the present Appellant was Respondent No.18 as the then Secretary of the Delhi Gymkhana Club. In the Company Petition No.71/ (ND)/2020, various orders were passed by the NCLT including the order dated 24.04.2020 which was passed by learned Single Member (Judicial) including all orders passed subsequent to 24.04.2020 and order dated 26.06.2020. The Appellant filed a CA No.440/PB/2022 praying for recall of the order dated 24.04.2020 and all orders passed subsequent to 24.04.2020 including the order dated 26.06.2020. CA No.440/PB/2022 was heard by Principal Bench and by order dated 15.12.2023, CA No.440/PB/2022 was dismissed by detailed order with cost of Rs.50,000/-. Order dated 15.12.2023 was pronounced by the Court in presence of the Appellant and was uploaded on website of the NCLT on 17.12.2023. Appellant on 08.01.2024 filed a CA No.22 of 2024 seeking extension of time for depositing costs till 31.03.2024. CA No.22 of 2024 was dismissed on 15.02.2024. On 18.02.2024, Appellant filed another application CA No.49 of 2024 praying for recall of the order dated 15.12.2023 and to declare it per incuriam. CA No. 49 of 2024 also came to be dismissed on 14.03.2024. The present appeal being Company Appeal (AT) No.242 of 2024 has been filed by the Appellant challenging the order dated 15.12.2023 on 01.05.2024. IA No.5502 of 2024 has been filed praying for condonation of 68 days' delay. The application came for consideration before this Tribunal on 12.08.2024 on which date notices were issued on Delay Condonation I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 3 Application and two weeks' time for filing reply was given. Reply has been filed by Ministry of Corporate Affairs to the Delay Condonation Application to which rejoinder has also been filed.

3. We have heard Shri Deepak Khosla, Counsel for the Appellant/ Applicant, Shri Raunak Dhillon, Counsel for the Union of India and Shri Prateek Kumar, Counsel for the Delhi Gymkhana Club Limited.

4. Shri Deepak Khosla, Counsel for the Appellant submits that the order dated 15.12.2023 is order passed in per incuriam and nullity. It is submitted that when the order impugned is per incuriam and nullity, consideration of delay application is inconsequential and this Tribunal may declare the order dated 15.12.2023 as nullity which shall obviate any consideration of Delay Condonation Application. It is further submitted that in any event of the matter delay in filing the Appeal is only 68 days i.e. within condonable period of 45 days after expiry of 45 days as provided by Section 421(3) of the Companies Act, 2013. It is submitted that the order dated 15.12.2023 was served on the Appellant by e-mail dated 22.02.2024, hence, the Appeal is filed with delay of 68 days which is within the condonable period. It is submitted that sufficient explanation has been given in the application IA No.5502 of 2024 for condonation of 68 days' delay and this Tribunal may hold that there is sufficient cause for condonation of delay and delay be condoned.

5. Shri Raunak Dhillon, Counsel appearing for the Union of India refuting the submissions of the Counsel for the Appellant submits that there is no occasion to enter into the merits of the Appeal or to enter into the validity of I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 4 the order dated 15.12.2023 while deciding the Delay Condonation Application IA No.5502 of 2024. It is submitted that unless the delay in filing the Appeal is condoned, this Tribunal may not enter into the merits of the submissions advanced by the Appellant questioning the order dated 15.12.2023. It is submitted that there is no sufficient cause shown for condonation of delay in filing the Appeal. It is contended that the Appellant after passing the order dated 15.12.2023 has immediately filed the application CA No.22 of 2024 on 08.01.2024, hence, was well aware of the order. Subsequently on 18.02.2024 Appellant himself has filed an application to recall the order dated 15.12.2023 i.e. CA No.49 of 2024 annexing the copy of the order, hence, the plea taken by the Appellant in the application that he was served the copy of the order only on 22.02.2024 cannot be accepted. It is submitted that the Appellant did not choose to file the appeal after passing of the order dated 15.12.2023 which was uploaded on 17.12.2023 rather filed an application for extension of time for depositing the costs and application for recalling of the order are no sufficient cause for condoning the delay. The Appellant who has been filing application after application before the NCLT and appeal before this Tribunal arising out of different orders passed in different applications filed by the Appellant, Appellant has been negligent and has no bonafide reason for entertaining the Appeal. It is submitted that no cause has been shown as to how the Appellant was prevented from filing the Appeal within the prescribed period. The cause shown in the application that the Appellant was prosecuting the alternate remedy by filing the application for recall also does not furnish any ground for condonation of delay. CA No.49 of 2024 was also dismissed on I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 5 14.03.2024 and no explanation has been given for not filing the appeal even thereafter. Appellant has been maliciously prosecuting the various application and has conducted himself. Appellant has initiated multifarious litigation before various fora which has been observed by the NCLT in order dated 15.12.2023 and on account of frivolous and wrongful filing of cases, a cost of Rs.50,000/- was also imposed on the Appellant by the NCLT. It is submitted that no case has been made out to condone the delay in filing the appeal. It is further submitted that the Appellant being well aware of the order at least from 08.01.2024 when he filed CA No.22 of 2024, time shall start running from 08.01.2024 and 45 days' period for filing the appeal and further condonable period of 45 days came to end on 07.04.2024, hence, the appeal has been filed beyond condonable period and the application deserves to be rejected.

6. Counsel appearing for the Respondent No.1- Delhi Gymkhana Club also adopted the submissions advanced by Counsel for the Union of India and submits that no sufficient cause has been shown by the Appellant for condonation of delay and Appeal deserves to be dismissed.

7. We have considered the submissions of the Counsel for the parties and perused the record.

8. We need to first notice the averments of the IA No.5502 of 2024 which is basis for praying for condonation of delay of 68 days. Paragraph 2 of the application contains the brief facts on which condonation of delay of 68 days I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 6 has been sought by the Appellant. Paragraph 2 of the application is as follows:-

"2. BRIEF FACTS:

That the appellant humbly prays to seek condonation of delay of 68 days in filing of the accompanying appeal with regards to:

a) That the impugned order of CA No. 440 of 2022 was reserved on 22- 9-2023 and pronounced on 15-12-2023, which was communicated later to the appellant dated 22-

02-2024, after recall of order dated 15- 02-2024 passed by Ld. NCLT in CA No. 22 of 2024, filed by the appellant for seeking extension of time to pay costs. A copy of the order dated 21.02.2024 recalling adverse 15-02-2024 order with confirmation that Rules- 50 and 150 had been violated in respect of the 15-12-2024 order is annexed as Annexure A-

b) That the Appellant preferred an alternate remedy, by filing an application (CA No. 49 of 2024) dated 18-02-2024 seeking recall of the order dated 15-12-2023 but it was not listed till 14-03-2024. A copy of non-complied directions of ld. Registrar NCLT dated 29.02.2024 to list CA No. 49 of 2024 on fulfillment of Rule -13 of NCLT Rules is annexed as Annexure A-3.

c) That the Appellant placing good faith upon Ld. NCLT, waited for the pending outcome of CA No. 49 of 2024 which was dismissed due to typing error in Affidavit on 14-03- I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 7 2024. Post the dismissal appellant has therefore, filed the present appeal before this Hon'ble NCLAT, New Delhi."

9. The Appellant's case in the application is that the order dated 15.12.2023 was communicated to the Appellant on 22.02.2024. It is further case of the Appellant that the Appellant preferred an alternate remedy by filing an application CA No.49 of 2024 on 18.02.2024 seeking recall of the order dated 15.12.2023 which was dismissed on 14.03.2024.

10. Section 421 provides for filing an appeal against orders of Tribunal. Section 421(3) provides for limitation for filing an appeal. Section 421(3) which is relevant for the present case is as follows:-

"421. Appeal from orders of Tribunal:- .......(3) Every appeal under sub-section (1) shall be filed within a period of forty-five days from the date on which a copy of the order of the Tribunal is made available to the person aggrieved and shall be in such form, and accompanied by such fees, as may be prescribed:

Provided that the Appellate Tribunal may entertain an appeal after the expiry of the said period of forty-five days from the date aforesaid, but within a further period not exceeding forty-five days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within that period."

11. The period of limitation prescribed for filing appeal is 45 days but as per proviso to Section 421(3), the Appellate Tribunal may entertain an appeal I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 8 after the expiry of the said period of forty-five days from the date aforesaid, but within a further period not exceeding forty-five days, "if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within that period". Thus, the Appellate Tribunal has to be satisfied that the Appellant was prevented by sufficient cause from filing the appeal within that period. We, thus, need to examine the pleadings and materials on record to find out as to whether there is any reason to record satisfaction that the Appellant was prevented by sufficient cause from filing the appeal within that period. As noted above, the Appellant has filed CA No.22 of 2024 praying for extension of time for depositing of the cost. Copy of CA No.22 of 2024 has been brought on record in the reply filed by the Union of India. As noted above, by order dated 15.12.2023, Appellant was directed to deposit the cost of Rs.50,000/- within the period of seven days. Order was pronounced in presence of the Appellant, thus, the Appellant was well aware of the order dated 15.12.2023 from the date when it was pronounced and the application was filed on 08.01.2024 seeking extension of time to deposit the cost. It is relevant to notice two paragraphs in the application i.e. paragraphs 1 and 7 which are as follows:-

"1. The present application is filed by Col. Ashish Khanna, SM (retd), Respondent No. 18, in respect of 15.12.2023 order by this Hon'ble NCLT dismissing CA- 440/2022 with direction to pay costs of Rs 50,000/-. It is humbly submitted applicant seeks extension due to financial distress. Respondent No.1 has illegally withheld his dues repeatedly assured to Hon'ble I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 9 NCLAT and Govt. A copy of 15.04.2021 non-complied Hon'ble NCLAT order and 04.06.2021 redress assured by ex Administrator is annexed as Annexure A-1(colly).

xxx xxx xxx

7. For above facts applicant is unable to deposit Rs 50,000/- cost in PM National relief fund till his Rs. 52 Lakh Audit qualified dues are paid. It is submitted without prejudice to appeal the 15.12.2023 order, Ld. NCLT may kindly grant extension, till withheld dues are paid as recorded in repeated court Notices. On 03.09.2023 R-1 Auditor again objected illegal denial of Rs. 3.4 Lakh dues. It was concealed by R-1 in its reply proving more fraud against this hapless R-18. A copy of 03.09.2023 Audit objection to R-18's withheld dues is annexed as Annexure A-7."

12. Paragraph 7 clearly indicates that the Appellant has pleaded that the NCLT may kindly grant extension without prejudice to appeal the 15.12.2023 order. Thus, Appellant was well aware of order and in the said paragraph also clearly indicated that the said extension is without prejudice to the appeal the 15.12.2023 order. The only explanation given in the application is that the Appellant has preferred a CA No.49 of 2024 dated 18.02.2024 seeking recall of the order dated 15.12.2023 which application was rejected on 14.03.2024. The application for condonation of delay is completely silent as to what prevented the Appellant from filing the appeal after 14.03.2024 when CA No.49 of 2024 was dismissed by the Tribunal. Admittedly, the present Appeal i.e. Company Appeal (AT) No.242 of 2024 has been filed on 01.05.2024. As noticed above, the Appellate Tribunal can entertain an appeal "if it is I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 10 satisfied that the appellant was prevented by sufficient cause from filing the appeal within that period" obviously denote to further 45 days' period mentioned in proviso to Section 421(3). Thus, Appellant in an application for seeking condonation of delay on the strength of proviso to Section 421(3) has to plead and prove that the Appellant was prevented by sufficient cause from filing the appeal within further period of 45 days. Even if we proceed on the case set up by the Appellant that he was served copy of the order on 22.02.2024, 45 days' period shall come to an end by 07.04.2024 and hence, for the further period there has to be sufficient cause for condoning the delay invoking the proviso to Section 421(3) on Appellant giving any sufficient cause that Appellant was prevented by sufficient cause from filing the appeal within that period. What to say about any sufficient cause, no cause has been shown in the application filed by the appellant seeking condonation of delay due to which delay occurred beyond 45 days which is prescribed for filing appeal under Section 421(3). It is further relevant to notice certain averments contained in IA No.49 of 2024 which was filed by the Appellant for recall of the order dated 15.12.2023. The copy of the IA No.49 of 2024 has been brought on the record by Union of India as Annexure R4. Page 36 of the reply contains the Internal Index of the application dated 18.02.2024 which is as follows:-

"INTERNAL INDEX Sl. PARTICULARS Page No. No. VOLUME-I I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 11 1. Internal Index. 1 2. Letter to Bench Officer. 2

3. Notice of Motion, with proof of service. 3-6

4. Memo of Parties in CP No. 71 of 2020, 7-9

5. Memo of Parties to this CA. 10-11

6. Company application, alongwith 12-53 Affidavit.

7. Annexure 1: Order dated 15-12-2023. 54-132

8. Annexure 2: NCLAT judgement dated 133-142 16-10-2023 (Suchi Paper).

9. Annexure 3: Written Submissions dated 143-199 01-09-2023 (w/o annexures).

VOLUME-II

10. Annexure 3 (Contd.): Written 200-211 Submissions dated 01-09-2023.

11. Annexure 4: Written Submissions dated 212-246 23-10-2023 (w/annexures).

12. Annexure 5: NCLT (Kolkata) order dated 247-302 04-01-2024.

13. Annexure 6: Legal opinion dated 16-08- 303-348 2020 issued by Hon'ble Mr Justice S. J.

Mukhopadhyay.

14. Annexure 7: WS dt. 24-08-2020 filed in 349-387 NCLAT by Mr G Liberhan and Respondent No. 20 Mr A Kathpalia.

15. Annexure 8: Affidavit complaint against 388-396 Ld Judicial Member and NCLT's bias for Delhi Gymkhana Club in CP-191/20 by senior members 16. Annexure 9: Original Pay Order Ref. No. 397 47151 2003 451 dated 17-02- 2024 for Rs. 50,000 by HDFC Bank (Noida) in favour of "PM National Relief Fund", deposited under protest for NCLT's refusal of protection.

I.A. No.5502 of 2024

IN Company Appeal (AT) No.242 of 2024 12 17. Proof of service. 398

13. Annexure 1 of the application is the order dated 15.12.2023. Thus, the Appellant was in possession of the order and has filed the order along with his application dated 18.02.2024. The averments made in the application also makes it clear that the Appellant has read the order and was aware of all contents of the order. It is relevant to refer to paragraphs 3, 11, 13 of the application which are as follows:-

"3. In the alternative, and de hors the above-mentioned relief, he also prays (independently) that para 69 be recalled, as the directions contained therein have been issued 'without jurisdiction', and in breach of audi alterum partum, either of the aforesaid two grounds rendering the direction contained in para 69 to be a nullity in law, void ab initio as if non est. *** *** ***

11. Therefore, it is all the more surprising for the applicant to have read the order delivered by this Hon'ble Tribunal the very next day (i.e. 15- 12-2023), whereby this Hon'ble Tribunal, not having taken judicial notice of the judgement of Hon'ble NCLAT delivered in the case of Suchi Paper Mills Ltd., has dismissed CA No. 440 of 2022, holding that the administrative orders passed by Ld. (acting) President in March/April 2020 lawfully constituted an appropriate exercise of jurisdiction represented by a conscious carve-out of class of cases which met with I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 13 the statutory requirements contained in the proviso to Section 419 (3) of the Companies Act (2013).

*** *** ***

13. To pre-empt any argument that the challenge raised by the appellant in the aforementioned case of Suchi Paper Mills Ltd succeeded on merits, the applicant reproduces verbatim below the contents of para 23 of the aforementioned judgement of Hon'ble NCLAT, because it makes it clear that though the aforementioned judgement dated 16-10-2023 2023 also discussed the respective merits of the parties (albeit, briefly), however, the appeal succeeded without touching the merits of the case, because Hon'ble NCLAT was satisfied that it was a case where the impugned order had been passed, inter-alia, without jurisdiction', coram non judice, meaning, in breach of the proviso to Section 419 (3) of the Companies Act (2013) (underlining emphasis supplied by the applicant):

"23. Consequently, the appeal is allowed and the impugned order dated 01.04.2020 is set aside. The matter is remanded back to the Adjudicating Authority. Those two unnumbered applications are hereby restored. The registry of the NCLT shall assign numbers to both the applications i.e. filed by the RP and Resolution Applicant and then both the applications shall be decided by the Adjudicating Authority in accordance with law by passing a speaking order. The parties are directed to appear before the Adjudicating Authority on 10th November, 2023. It is made clear that we have not touched the merit of the case because we were satisfied that it is I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 14 a case where impugned order has been passed firstly without jurisdiction and secondly without following the principle of natural justice. All the issues regarding the merits are still open which shall be decided by the Adjudicating Authority in accordance with law. Since, both Counsel for the parties have earnestly requested that a direction may be issued to the Adjudicating Authority to decide it expeditiously, therefore, we order accordingly. The registry is directed to send the copy of this order to the concerned Adjudicating Authority."

14. When the Appellant was well aware of the contents of the order dated 15.12.2023 and which order was also filed along with CA No.49 of 2024, we fail to see what prevented him from filing the appeal against the order 15.12.2023. Further, as per own case of the Appellant, CA No.49 of 2024 came to be dismissed on 14.03.2024. Appellant's entire case seeking condonation is on the ground that Appellant has preferred an alternate remedy in filing CA No.49 of 2024 when the said application was rejected on 14.03.2024, there was nothing to prevent the Appellant from filing an appeal which appeal he filed on 01.05.2024. In the application filed for condonation of delay there are no cause or explanation given by the Appellant due to which the Appellant was prevented from filing appeal till 01.05.2024. We, thus, are of the view that on mere reading of the application and the cause given, there are no cause or reason given by the Appellant as to what prevented the Appellant from filing the appeal within further period of 45 days which was available under proviso to Section 421(3). Thus, we are of the view that there are no cause or reason I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 15 given in the application praying for condonation of delay for this Appellate Tribunal to satisfy that appellant was prevented by sufficient cause from filing the appeal within that period.

15. In this context, we may refer to the judgment of this Tribunal in "Laly Joseph vs. Indo Asian News Channel Pvt. Ltd.- 2023 SCC OnLine NCLAT 1683" wherein this Tribunal while considering the provision of Section 421(3) of the Companies Act, 2013 has laid down following in paragraphs 7 and 8, which are as follows:-

"7. Section 421(1) provides that any person who is aggrieved by an Order of the Tribunal has a right to prefer an Appeal before the Appellate Tribunal. Section 421(2) debars the filing of an Appeal against an Order which has been passed on the consent of the parties. Insofar as, the period of limitation is concerned, it is provided in Section 421(3) that the Appeal could be filed within a period of 45 days accompanied by such fee as may be prescribed. In case of expiry of the statutory period of the 45 days. proviso to Section 421(3), further provides a period of 45 days for a litigant to file the Appeal after showing sufficient cause for not approaching the Court within the statutory period provided under Section 421(1) and can maintain the Appeal provided it is proved that he could not approach the Court within a prescribed time due to a sufficient cause.

8. Hence, the sufficient cause is a Sine-Qua-Non for the purpose of entertaining an Application and granting I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 16 Condonation of Delay in such cases. We have considered the arguments of the Counsel for the Appellant and after perusal of the averments made in the Application, are of the considered opinion that the reason given in the Application do not constitute sufficient cause because the Appellant had been seeking under unnecessary beliefs."

16. In the above case, this Tribunal has held that sufficient cause is sine- qua-non for the purpose of entertaining an application and granting condonation of delay.

17. We also need to notice another judgment of the Hon'ble Supreme Court reported in "Ramlal, Motilal, Chotelal vs. Rewa Coalfields Ltd.- AIR 1962 SC 361". The Hon'ble Supreme Court has held that even if sufficient cause has been shown, a party is not entitled to the condonation of delay in question as a matter of right. It is held that the proof of a sufficient cause is a condition precedent for the exercise of the discretionary jurisdiction vested in the court by Section 5. In paragraph 12, following has been held by the Hon'ble Supreme Court:-

"12. It is, however, necessary to emphasise that even after sufficient cause has been shown a party is not entitled to the condonation of delay in question as a matter of right. The proof of a sufficient cause is a condition precedent for the exercise of the discretionary jurisdiction vested in the court by Section 5. If sufficient cause is not proved nothing further has to be done; the application for condoning delay has to be dismissed on I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 17 that ground alone. If sufficient cause is shown then the court has to enquire whether in its discretion it should condone the delay. This aspect of the matter naturally introduces the consideration of all relevant facts and it is at this stage that diligence of the party or its bona fides may fall for consideration; but the scope of the enquiry while exercising the discretionary power after sufficient cause is shown would naturally be limited only to such facts as the court may regard as relevant. It cannot justify an enquiry as to why the party was sitting idle during all the time available to it in this connection we may point out that considerations of bona fides or due diligence are always material and relevant when the court is dealing with applications made under Section 14 of the Limitation Act. In dealing with such applications the court is called upon to consider the effect of the combined provisions of Sections 5 and 14. Therefore, in our opinion, considerations which have been expressly made material and relevant by the provisions of Section 14 cannot to the same extent and in the same manner be invoked in dealing with applications which fall to be decided only under Section 5 without reference to Section 14. In the present case there is no difficulty in holding that the discretion should be exercised in favour of the appellant because apart from the general criticism made against the appellant's lack of diligence during the period of limitation no other fact had been adduced against it. Indeed, as we have already pointed out, the learned Judicial Commissioner rejected the appellant's application for condonation of delay only on the ground that it was appellant's duty to file the appeal I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 18 as soon as possible within the period prescribed, and that, in our opinion, is not a valid ground."

18. Another recent judgment of the Hon'ble Supreme Court which need to be noticed is judgment of the Hon'ble Supreme Court in "Pathapati Subba Reddy & Ors. vs. Special Deputy Collector- 2024 SCC OnLine SC 513"

wherein the Hon'ble Supreme Court has observed that the courts have adopted a very liberal approach in construing the phrase 'sufficient cause' used in Section 5 of the Limitation Act. However, notwithstanding the above sufficient cause for not filing appeal in time is a condition precedent for exercising the discretionary power to condone the delay. In paragraph 16, following was held:-

"16. Generally, the courts have adopted a very liberal approach in construing the phrase 'sufficient cause' used in Section 5 of the Limitation Act in order to condone the delay to enable the courts to do substantial justice and to apply law in a meaningful manner which subserves the ends of justice. In Collector, Land Acquisition, Anantnag v. Katiji, this Court in advocating the liberal approach in condoning the delay for 'sufficient cause' held that ordinarily a litigant does not stand to benefit by lodging an appeal late; it is not necessary to explain every day's delay in filing the appeal; and since sometimes refusal to condone delay may result in throwing out a meritorious matter, it is necessary in the interest of justice that cause of substantial justice should be allowed to prevail upon technical considerations and if the delay is not deliberate, it ought I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 19 to be condoned. Notwithstanding the above, howsoever, liberal approach is adopted in condoning the delay, existence of 'sufficient cause' for not filing the appeal in time, is a condition precedent for exercising the discretionary power to condone the delay. The phrases 'liberal approach', 'justice-oriented approach' and cause for the advancement of 'substantial justice' cannot be employed to defeat the law of limitation so as to allow stale matters or as a matter of fact dead matters to be revived and re-opened by taking aid of Section 5 of the Limitation Act."

19. As noted above, present is a case where what to say of sufficient cause, no cause has been shown by the Appellant for not filing the appeal after 14.03.2024, when CA No. 49 of 2024 came to be dismissed, till filing of the appeal on 01.05.2024. Thus, we are satisfied that the Appellant has failed to prove that he was prevented from filing the appeal within the period of 45 days as permissible under proviso to Section 421(3).

20. We also need to notice one more submission of the Counsel for the Appellant that the order passed on 15.12.2023 was per incuriam and nullity, hence, the question of delay is inconsequential and this Court may declare the order as nullity in this Appeal. He has relied on the judgment of this Tribunal in "Suchi Paper Mills Ltd vs. Ashish Gupta, Resolution Professional- Company Appeal (AT) (Ins.) No.830 of 2020" decided on 16.10.2023. It is submitted that in the said judgment this Tribunal held that Single Member Bench has no jurisdiction to pass an order. It is submitted that in view of the above judgment, the order passed by the NCLT dated I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 20 15.12.2023 is per incuriam. During submissions, it has also been submitted that the judgment of this Tribunal was not interfered by the Hon'ble Supreme Court in Civil Appeal No.8190 of 2023- "Bank of Baroda vs. Suchi Paper Mills Ltd. & Ors." where Hon'ble Supreme Court has dismissed the Appeal upholding the order of the NCLAT.

21. The submission which has been advanced by Shri Deepak Khosla is on the merits of the order dated 15.12.2023. We are of the view that without condonation of delay in filing the appeal, this Tribunal may not entertain the challenge to the merits of the order. Challenge of the Appellant is that the order dated 15.12.2023 is nullity and per incuriam. He obviously challenges the order on merits. This Appellate Tribunal has no jurisdiction to entertain challenge on merits of the order challenging in the Appeal when the Appeal is not being entertained on the ground that delay in filing the appeal is uncondonable.

22. Counsel for the Respondent has also relied on the judgment of the Hon'ble Supreme Court in "Asma Lateef and Another vs. Shabbir Ahmad and Ors.- (2024) 4 SCC 696" where Hon'ble Supreme Court in paragraph 52 has laid down following:-

"52. The legal and factual position of the present case having been noted above, we hold that a decision rendered by a court on the merits of a controversy in favour of the plaintiff without first adjudicating on its competence to decide such controversy would amount to I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 21 a decision being rendered on an illegal and erroneous assumption of jurisdiction and, thus, be assailable as lacking in inherent jurisdiction and be treated as a nullity in the eye of the law; as a logical corollary, the order dated 5-8-1991 is held to be ab initio void and the decree drawn up based thereon is inexecutable."

23. A Division Bench of the Allahabad High Court in Consolidation No.6574 of 2016- "Ram Prakash vs. Deputy Director of Consolidation, Hardoi & Ors." decided on 03.02.2022 had laid down that if appeal is filed beyond the time, the appeal can be entertained and heard on merits only after delay is condoned. In paragraphs 20 and 21 of the judgment following has been laid down:-

"20. If any statute provides certain period for filing of appeal, an appeal filed beyond the time limit will certainly be not entertained. sought to be condoned. It is only after that the application is allowed, the appeal can be entertained and heard on merits. Before that the appeal cannot be taken up and considered on merits.

21. As far as the issue regarding hearing of the application seeking condonation of delay and the appeal simultaneously is concerned, in our view, firstly the application has to be considered. Only thereafter, the appeal can be considered on merits but there is nothing in law which requires hearing of appeal on merits to be postponed mandatorily after acceptance of the application seeking condonation of I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 22 delay. Both can be taken up on the same day. However, the appeal has to be heard on merits only after the application seeking condonation of delay has been accepted."

24. The Hon'ble Supreme Court in "State of Jharkhand and Ors. vs. Ashok Kumar Chokhani and Ors.- (2009) 2 SCC 667" had also held that while deciding an application for condonation of delay in filing the appeal, the High Court could not go into the merits of the same. Paragraph 3 of the judgment is as follows:-

"3. It is true that an observation has been made by the High Court in the impugned order that the subject- matter in the appeal also did not suffer from any infirmity but it is well settled that while deciding an application of condonation of delay in filing the appeal, the High Court could not go into the merits of the same. Even assuming that the High Court had the power to go into that question, then also, in our view, the impugned order does not disclose any reason why the subject-matter in the appeal did not suffer from any infirmity."

25. In view of the above precedents, it is clear that while considering the delay, the Court cannot enter into the merits of the appeal without first condoning the delay in filing the appeal. We, thus, are not persuaded to accept the submission of the Counsel for the Appellant that the Court may consider the submission that the order impugned is without jurisdiction and nullity to I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 23 obviate the consideration of delay. We hold that without condoning the delay in filing the appeal, merits of the appeal cannot be looked into.

26. We may also notice that in the Rejoinder-Affidavit filed by the Appellant to the reply filed by Respondent No.1 in IA No.5502 of 2024, several allegations and facts have been narrated which are unconnected with the issue of condonation of delay in filing the appeal, hence, the said allegation and averments neither need to be noticed nor dealt with. In the rejoinder, however, appellant has relied on judgment of this Tribunal in Company Appeal (AT) (Ins.) No. 217 & 218 of 2022- "Bhawanishankar Harishchandra Sharma vs. Feedback Highways OMT Pvt. Ltd." in support of his submission that this Tribunal has condoned the delay of four years. In Company Appeal (AT) (Ins.) No. 217 & 218 of 2022, two orders passed by the NCLT dated 10.01.2018 and 25.02.2022 were challenged. This Tribunal held that the order dated 10.01.2018 was not pronounced by the Bench which has heard the case and the said order was void ab-initio. The question which was involved in the case has been noticed in paragraph 12 of the judgment which is as follows:-

"12. Now the question involved in this case is as to whether a member of the bench who has not heard the arguments can pronounce the order of a reserved Judgment?"

27. In paragraph 16 of the judgment, this Tribunal took the view that the order dated 10.01.2018 which was passed by a Bench in which one of the member was not a member of the bench who had heard the matter at the time I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 24 when it was reserved, is patently illegal and void ab-initio. Paragraph 16 of the judgment is as follows:-

"16. Thus, from the resume of the aforesaid facts and circumstances, it is clear to us that law does not permit that the case is heard by one entity and the order is pronounced by another who has not heard the case at all. In such circumstances, the question posed hereinabove is hereby answered in favour of the Appellant and it is held that the order dated 10.01.2018, having been passed by a bench in which one of the member was not a member of the bench who had heard the matter at the time when it was reserved, is patently illegal and void ab-initio."

28. In the above background, this Tribunal held that the Appeal was maintainable not only against the order dated 25.02.2022 but earlier order dated 10.01.2018. In the above background, the Appellate Tribunal held that the Appeal was well within time even against the order dated 10.01.2018 since the said order was never pronounced by the Bench competent to do so. In paragraph 21 of the judgment, following was held:-

"21. He has put emphasis on the issue of pronouncement of the order to contend that the certified copy which is required for the purpose of filing the appeal in order to count the limitation can only be obtained after the pronouncement of the order where as in the present case there was no pronouncement."

I.A. No.5502 of 2024

IN Company Appeal (AT) No.242 of 2024 25

29. The above judgment did not indicate that this Tribunal condoned the delay of four years as pleaded by the Appellant in the rejoinder-affidavit. Appeal was held competent against both the orders dated 10.01.2018 and 25.02.2022 in the facts peculiar that the said case as has been noticed above. Thus, the judgment of this Tribunal in "Bhawanishankar Harishchandra Sharma" (supra) does not help the appellant in the facts of the present case.

30. We having already taken the view that no sufficient cause has been shown by the Appellant as to how he was prevented from filing the appeal within period as required under Section 421(3) proviso. We are not persuaded to entertain submission of the Appellant on the merits of challenge to the order impugned. There is one more reason due to which Appellant's prayer in the application for condonation of delay cannot be allowed. We have noted the judgment of the Hon'ble Supreme Court in "Ramlal, Motilal, Chotelal"

(supra) where it has been held that even after sufficient cause has been shown by the parties, parties are not entitled to condonation of delay in question as a matter of right. Even if sufficient cause has been shown Court has to enquire as to whether it should exercise its discretion to condone the delay.

31. From the sequence of the events and facts, we have already found that the Appellant has not even shown any sufficient cause that he was prevented to file an appeal rather Appellant is clearly negligent in filing the appeal since he was well aware of the order even prior to 22.02.2024 and has filed two applications CA No.22 of 2024 on 08.01.2024 and CA No.49 of 2024 on 18.02.2024. We have already noticed that in CA No.22 of 2024 filed on I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024 26 08.01.2024, Appellant has already pleaded that extension of time be granted without prejudice to the rights of the Appellant to file appeal. Thus, Appellant has already pleaded in paragraph 7, as extracted above, that he has right to file an appeal without prejudice to the extension of time.

32. For the above reasons and conclusions, we are not satisfied that Appellant was prevented by sufficient cause from filing the Appeal within the extended period of 45 days. The Delay Condonation Application deserves to be dismissed and is hereby dismissed. In consequence of dismissal of Delay Condonation Application, Memo of Appeal is also rejected.

[Justice Ashok Bhushan] Chairperson [Arun Baroka] Member (Technical) New Delhi Anjali I.A. No.5502 of 2024 IN Company Appeal (AT) No.242 of 2024

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