Gammon Engineers And Contractors Pvt. ... vs Sutanu Sinha & Ors on 11 October, 2022

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National Company Law Appellate Tribunal

Gammon Engineers And Contractors Pvt. ... vs Sutanu Sinha & Ors on 11 October, 2022

These three Appeal(s) have been filed against the same judgment/ order dated 10.05.2022 passed by National Company Law Tribunal, Principal Bench, New Delhi in IA No.1538 of 2021 in CP(IB)1504(PB)/2019. There is delay in filing these Appeal(s) by the Appellant(s). Application for Condonation of Delay in filing the Appeal(s) have been filed by the Appellant(s), on which Application both the parties were heard on 28.09.2022 and orders were reserved.

2. Company Appeal (AT) (Insolvency) Nos. 920 and 922 of 2022 have been presented on 13.07.2022, whereas Company Appeal (AT) (Insolvency) No.1072 of 2022 was presented on 06.07.2022. For Condonation of Delay in all these Appeal(s), similar grounds have been taken. It is sufficient to consider the facts and pleadings in IA No.3301 of 2022 filed in Company Appeal (AT) (Insolvency) No.920 of 2022 for deciding all the three Applications for Condonation of Delay filed in these Appeal(s).

3. An Application for certified copy of the order was made by the Applicant on 12.05.2022 with court fee of Rs.5/-. The balance court fee was paid on 09.06.2022 and certified copy was ready and delivered on 14.06.2022. The case of the Applicant in the Application is that the order Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 3 of the Adjudicating Authority dated 10.05.2022 was pronounced virtually on 10.05.2022, but the copy of the order was uploaded only on 31.05.2022 and after 31.05.2022, the Applicant came to know about the details of the order and then they deposited the balance court fees on 09.06.2022. The Applicant's case is that entire period from 12.05.2022 to 14.06.2022, which was time requisite for obtaining the certified copy of the order need to be excluded as per Section 12, sub-section (2) of the Limitation Act, 1963 and when the said period is excluded, the Appeal No.1072 of 2022, which was presented on 06.07.2022 is well within 30 days and Appeal Nos.920 and 922 of 2022 presented on 13.07.2022 are filed within 45 days from the date of the impugned order. It is submitted that if date of uploading of judgment of Adjudicating Authority, i.e., 31.05.2022 is taken, the Appeal are within 45 days.

4. The learned Counsel for the Respondent No.1 refuting the submissions of the learned Counsel for the Appellant submits that all the Appeal(s) are barred by time and deserve to be rejected. It is submitted that no proof or evidence has been laid by the Appellants to prove that judgment was uploaded on 31.05.2022. It is further submitted that in view of the judgment of the Hon'ble Supreme Court in V. Nagarajan vs. SKS Ispat and Power Limited & Ors. (2022) 2 SCC 244, the Appellants have to be vigilant and apply for certified copy of the order immediately after passing of the order and Appellants cannot wait for uploading of the order, if any. It is further submitted that Appellants are also not entitled for exclusion of period from 12.05.2022 to 09.06.2022 under Section 12, sub- Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 4 section (2) of the Limitation Act, 1963, since the copy of the Application filed on 12.05.2022 was deficient and the Application was filed only with court fees of Rs.5/- and the same has became in order only on 09.06.2022, when court fees for certified copy was paid by the Appellants and at best the Appellants are entitled for exclusion of time from 09.06.2022 to 14.06.2022 and if time from 09.06.2022 to 14.06.2022 is excluded, the Appeal(s) having been filed beyond 45 days from 10.05.2022 deserve to be rejected as barred by time.

5. The Hon'ble Supreme Court in V. Nagarajan vs. SKS Ispat (supra) has categorically held that limitation for filing an Appeal shall start running from the date of passing of the order and the Appellants cannot claim running of the limitation from the date of uploading of the order. We, thus, are of the view that the limitation for filing the Appeal commenced with effect from 11.05.2022. The question which falls for consideration in the present Appeal(s) is as to whether the Applicant(s) are entitled for exclusion of period requisite for obtaining the certified copy of the order with effect from 12.05.2022 to 14.06.2022 or the Applicant(s) are entitled to exclude the time only from 09.06.2022 to 14.06.2022, when balance court fee for obtaining certified copy was paid. It is not denied that order was pronounced virtually by the Adjudicating Authority and both the parties were present in the virtual hearing on the date of pronouncement of the order.

6. Section 12, sub-section (2) of the Limitation Act, 1963 provides that the time requisite for obtaining a copy of the order shall be excluded. In Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 5 the present case, there is no dispute that Application for certified copy of the order was applied on 12.05.2022 with court fee of Rs.5/- only. Deficient court fee was paid on 09.06.2022. The short question to be answered is that as to whether exclusion of period for obtaining of certified copy shall be from 12.05.2022 to 14.06.2022 or 09.06.2022 to 14.06.2022. NCLT Rules, 2016, Rule 2 in the definition clause defines 'application' as follows:

"2.(5) "application" means any application, interlocutory application or proceedings filed under the provisions of the Act, including any transferred application or transferred petition as defined under sub- rule (29)."

7. Rule 2, sub-rule 12, defines "fee" in following words:

"2(12) "fee" means the amount payable in pursuance of the provisions of the Act and these rules for any petition or application or interlocutory application or a document or for certified copy of document or order of the Tribunal or such other paper as may be specified in Schedule of Fees to these rules and includes any modifications as may be made thereto or any fee as prescribed for filing of documents to the Tribunal by these rules"

8. In the "Schedule of Fees", fee for obtaining certified true copy has been defined as follows:

"31. Fee for obtaining certified true copy of 5/- per final order passed to parties other than page."

the concerned parties under Rule 50 Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 6

9. Thus, the Rules make it clear that application for obtaining certified copy of the order is to be made as per the Rules after payment of the prescribed fees. Application for certified copy is also an application within the meaning of the Rules.

10. Now we come to Rule 28, which provides as follows:

"28. Endorsement and scrutiny of petition or appeal or document.-(1) The person in charge of the filing counter shall immediately on receipt of petition or appeal or application or document affix the date stamp of Tribunal thereon and also on the additional copies of the index and return the acknowledgement to the party and he shall also affix his initials on the stamp affixed on the first page of the copies and enter the particulars of all such documents in the register after daily filing and assign a diary number which shall be entered below the date stamp and thereafter cause it to be sent for scrutiny. (2) If, on scrutiny, the appeal or petition or application or document is found to be defective, such document shall, after notice to the party, be returned for compliance and if there is a failure to comply within seven days from the date of return, the same shall be placed before the Registrar who may pass appropriate orders. (3) The Registrar may for sufficient cause return the said document for rectification or amendment to the party filing the same, and for this purpose may allow to the party concerned such reasonable time as he may consider necessary or extend the time for compliance. (4) Where the party fails to take any step for the removal of the defect within the time fixed for the same, the Registrar may, for reasons to be recorded in writing, decline to register the pleading or document."

Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 7

11. Under Rule 28, sub-rule (2), when an application is found to be defective, notice of the defect is to be given to the parties and if there is a failure to comply within seven days, the same is to be placed before the Registrar for passing appropriate orders. In the present case, when Application for certified copy was filed with deficient court fee, under Rule 28, the Applicant was to be noticed about the defect and was required to comply the same within seven days. There is no material on record to show as to when the Applicant was intimated to remove the defect, but the fact remained that deficient court fee was submitted on 09.06.2022 and thereafter, the Application was processed and certified copy was prepared on 14.06.2022.

12. This Tribunal had occasion to consider Rule 28 of the NCLT Rules, 2016 in Company Appeal (AT) (Insolvency) No 721 of 2022 - Krishan Kumar Basia vs. State Bank of India. The question in the above case was as to what is the date of presentation of the Application, if there were defects in the Application, which were subsequently cured and application was numbered. This Tribunal held that the filing of the Application shall be from the date when it was initially filed and subsequent scrutiny or numbering of the application is not relevant. Applying the ratio of the above judgment of this Tribunal, it is clear that Application for certified copy of the order dated 10.05.2022 shall be treated to be filed on 12.05.2022 despite they being deficient of court fee, which defect was subsequently cured on 09.06.2022. It is to be noted that in the Rules, Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 8 which govern procedure for filing certified copy of the order in subordinate Courts of all States, Applicant who has applied for certified copy of the order is intimated about the defect in the Application and requisite stamps etc. are informed to the Applicant, time requisite for submitting the stamp paper has been treated as time requisite for obtaining copy of the decree. We may refer to the full Bench judgment of Kerala High Court in (2001) 1 Klt-194(FB) - Francis vs. Deputy Registrar. The Kerala High Court has had occasion to consider the time requisite for obtaining certified copy of the decree for the purpose of Section 12 of the Limitation Act, 1963 as well as Rule 242 of the Civil Rules of Practice, Kerala. In paragraph three of the judgment, relevant provisions have been mentioned to the following effect:

"3. S. 12(2) of the Limitation Act, 1963 reads as follows:-

"12. Exclusion of time in legal proceedings-

1) XXX

2) In computing the period of limitation for an appeal or an application for leave to appeal or for revision or for review of a judgment, the day on which the judgment complained of was pronounced and the time requisite for obtaining a copy of the decree, sentence or order appealed from or sought to be revised or reviewed shall be excluded."

Rule 242 of the Civil Rules of Practice, Kerala reads as follows:-

"242. Calling for stamp papers:- Every day between the hours of 3 and 5 p.m. a list showing the applications in which records have been Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 9 received and the number of stamp papers required shall be affixed to the notice board of the copying section. Such list shall remain suspended for three clear working days in accordance with R. 6, but, if the last day should fall during a vacation the list shall remain till the day after the re-opening day. Within that time, the applicant shall supply the stamp papers called for, failing which the application shall be struck off".

The works "three clear working days" were substituted for the words "three days reckoned" by way of an amendment under notification dated 25.7.1985. The Explanatory Note to the above amendment reads as follows:-

"Explanatory Note: As per R.242 read with R.6 of the Civil Rules of Practice the stamp papers required for certified copies are to be produced within 3 days from the publication of the notice calling for the stamp papers. Under the present rule the litigant public and members of the Bar are denied the opportunity of getting 3 clear working days for production of stamp papers. The amendment is intended to overcome the difficulty"."

Ultimately after considering large number of cases, the High Court in paragraph 13 concluded that Appellant is entitled to exclude the time granted for producing the stamp paper as 'time requisite' for obtaining the copy of the decree. Paragraph 13 of the judgment is as follows:

"13. Therefore with great respect to the learned Judges who decided 1961 KLT 321 and 1992 (2) KLT 929 we are Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 10 constrained to hold that we cannot agree with their view. We therefore overrule 1961 KLT 321 and 1992 (2) KLT

929. We further hold that the appellant is entitled to exclude the time granted under R. 242 of the Civil Rules of Practice, Kerala for producing the stamp paper as 'time requisite' for obtaining a copy of the decree appealed from for the purpose of S. 12(2) of the Limitation Act, 1963. The office is therefore directed to number the appeal as one filed within the prescribed period and send up the matter for admission before the appropriate Bench."

13. The learned Counsel for Respondent No.3 placed reliance on two judgments in support of their submission that period from 12.05.2022 to 09.06.2022 could not be excluded. The judgments relied by Respondent are judgment reported in (1959) ILR 2 Cal 1 - Administrator, Howrah Municipality v. Calcutta Electric Supply Corporation Ltd. and AIR (1954) AP 104 - Dagduba and Ors. vs. Abdul Gafoor Khan. In the case of Howrah Municipality, the Respondent had made an Application for obtaining the copies of the record from the Municipality. In paragraphs 24, 25, and 26 following has been held:

"24. So far as the plea of limitation is concerned reference need be made to the provisions of Sections 141(2) and (3) of the Act, which are to the following Meet:

Section 141(2): Such appeal shall be presented to the Subordinate Judge of Howrah, within thirty days from the date of the order passed under Section 140, and shall be accompanied by an Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 11 extract from the register of objections containing the order objected to.

Section 141(3): The provisions of Parts II and III of the Indian Limitation Act, 1908, relating to appeals, shall apply to every appeal preferred under this section.

The argument of Mr. Roy on the point of limitation is that the application for copy was made by S.K. Sawday and Company on behalf of the Calcutta Electric Supply Corporation Ltd. on July 7, 1954, but the application was not accompanied by fees, prescribed under the schedule of fees for copies of records from the Municipal Record Room (ext. N). The Respondent waited till August 30, 1954, when it sent its first reminder to the Appellant [ext. 1(d)]. The prescribed fee was not sent even along with the said reminder and what was said in the aforesaid reminder was that if any fee was necessary for taking out a copy of the order, the same would be paid as soon as the Municipality advised the applicant regarding the amount. Thereafter a second reminder was sent by the Respondent on September 7, 1954, but even at that time the prescribed fee was not deposited. Ultimately the fee was deposited on September 10, 1954, as is evidenced by a receipt granted by the Howrah Municipality (ext. M) and the copy was made ready on September 13, 1954. The Respondent took delivery of the copy on September 21, 1954. According to Mr. Roy. the time from July 7, 1954: to September 21. 1954, was not the time requisite for obtaining a copy of the order appealed against. The Calcutta Electric Supply Corporation Ltd. was not entitled to exclusion of this period under Section 12(2) of the Indian Limitation Act. As such the appeal filed by the Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 12 Calcutta Electric Supply Corporation Ltd. on October 29, 1954, when the Civil Counts reopened after the Puja holidays, was barred by the special limitation prescribed under Section 141(2) of the Act.

25. The expression "time requisite for obtaining a copy"

as used in Section 12(2) of the Indian Limitation Act is a strong expression; it means something more than time required. It means time properly required and throws upon the Appellant the necessity of showing that no part of the delay beyond the prescribed period was due to his default. The delay caused by the carelessness or negligence in paying for the copy cannot be excluded from the computation of the period of limitation.

26. If application for copy, made by the Respondent Company, required to be accompanied by any fees, legally prescribed, then the failure on the part of the Respondent Calcutta Electric Supply Corporation Ltd. so to do would deprive if of the benefits under Section 12 of the Indian Limitation Act. Therefore, if on September 10, 1954. when the fee was deposited, the period of limitation had already run out, the appeal before the Subordinate Judge of Howrah, filed on October 20, 1954, must be barred by limitation."

Further, High Court in paragraph 28 noticed that Municipality failed to prove that it had actually written to the Respondent asking for deposit of fees, which is to the following effect:

"28. We have examined ext. L, the Municipal office endorsements on the application for copy, dated July 7, 1954. We find that on July 19, 1954, there was a note made on the application to the effect that necessary fees Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 13 might be deposited with the Record Keeper. On July 30, 1954, another note was made on the application, "Please write". We agree with the learned Subordinate Judge that the Municipality failed to prove that it had actually written to the Respondent asking for deposit of fees."

Further, in the above case, the High Court held that there was no rule for payment of fee, hence, the Respondent was entitled to exclude the entire period from the date when they applied for the copy and till date when the copy was ready. Following was laid down in paragraph 34:

"34. The elaborate argument of Mr. Roy can be disposed of on a short ground. Section 351A of the Bengal Municipal Act, 1884, does not authorise Commissioners of Municipalities, to make rules for levy of fee or charges for supply of copies. Therefore, under the authority of that section the schedule of fees, as in ext. N, could not be framed. If the Howrah Municipality framed any domestic rules in the matter, as evidenced by the proceedings of the Budget Special Committee of the Municipality (ext. P), the same had No. legal validity. Therefore although such fees were all through being charged and although ultimately the Respondent company also paid the fees so as to get the copy, we are not prepared to hold that the non-payment of such fees till September 10, 1954 was an instance of negligence and carelessness and disentitled the Respondent Company to the benefits of Section 12 of the Limitation Act. We hold that the entire period from July 7, 1954 till September 13, 1954 if not till the 21st September 1954) should be excluded in computing the period of limitation. If the above period is excluded Mr. Roy admits, that no Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 14 further question of limitation arises. We therefore hold that the appeal before the lower appellate court was not barred by limitation.

14. The above judgment does not directly support the submission of learned Counsel for Respondent No.3. More so, in the facts of the present case, there is statutory Rules, namely - NCLT Rules, 2016, under which the certified copy was applied and the Application being deficient is required to be communicated to the Applicant and there is prescribed time for removing the defects.

15. Now, we come to the next judgment relied by Respondent No.3, i.e., AIR (1954) AP 104 - Dagduba and Ors. vs. Abdul Gafoor Khan. In the case before the High Court of Hyderabad, Andhra Pradesh, the submission was made that Appellant was entitled to exclusion of period between date of the judgment and the date of signing the decree under Section 12 of the Limitation Act. In the above case, the High Court of Hyderabad held that time requisite does not begin until an application for copies has been made.

Following was laid down in paragraph 24:

"24. It is true that according to Order 20, Rule 7, Code of Civil Procedure the decree has to bear the date on which the judgment was pronounced and Order 41, Rule 1, Code of Civil Procedure provides that the memorandum of appeal has to be accompanied by a copy of the decree and limitation for an appeal must run from the date of the decree under Article 152, Limitation Act and Section 12 of the Act enacts that in computing the period of limitation prescribed, the time requisite for obtaining the copies of Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 15 the decree and judgment shall be excluded, but in our opinion time requisite does not begin until an application for copies has been made. The words 'requisite' and 'obtaining' mean that some definite step should be taken by the Applicant himself towards obtaining the copy and it cannot be said that the time was required for obtaining a copy if the Appellant had not even applied for a copy thereof. The 'time requisite for obtaining a copy of the decree' cannot refer to any period antecedent to the Appellant's asking for a copy by the usual mode of applying thereof, or to any period subsequent to its being ready for delivery."

The judgment of Hyderabad High Court, thus, does not help the Respondent in the present case.

16. We may also refer to a judgment of the Hon'ble Supreme Court in P.K. Palanisamy vs. N. Arumugham & Anr. - SLP (Civil) No.2308/2009. The Hon'ble Supreme Court in the above case had occasion to consider the scope of Section 149 of Civil Procedure Code. Section 149 of CPC gives the power to the Court to extend the time for payment of court fee. The Hon'ble Supreme Court in paragraph 7 laid down following:

"7. ....Section 149 raises a legal fiction in terms whereof as and when such deficit fee is paid, the same would be deemed to have been paid in the first instance."

17. Section 149 contemplate an order of the Court for extending the time, whereas in NCLT Rules, 2016, no order is contemplated by the Court for extension of time and the deficiencies of court fee and the defects in the application is to be cured as per Rule 28 within seven days from the date Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 16 of pointing out of the defects or within a further period as allowed by the Rules. When the defects are removed, the presentation of the Application has to be treated from the date of initial presentation and presentation of the Application shall not be treated from the date when defects were removed as has been held by this Tribunal in Krishan Kumar Basia (supra).

18. We, thus, are satisfied that Applicant(s) were entitled to exclude the period from 12.05.2022 to 14.06.2022, which was time requisite for obtaining certified copy of the order dated 10.05.2022. If the time requisite is excluded, limitation of 30 days' time for filing the Appeal shall be till July, 12.07.2022. We, thus, hold that Appeal No.1072 of 2022 is filed within the period of limitation and Appeal Nos. 920 and 922 of 2022 were filed within 15 days beyond the period of 30 days. Short delay in filing Appeal Nos.920 and 922 of 2022 deserves to be condoned under Section 61, sub-section (2) & proviso of the Code. We, thus, allow the Application for Condonation of Delay in Company Appeal (AT) (Insolvency) Nos.920 and 922 of 2022.

Let the Appeal(s) be listed for admission on 12.10.2022.

[Justice Ashok Bhushan] Chairperson [Barun Mitra] Member (Technical) NEW DELHI 11th October, 2022 Ashwani Company Appeal (AT) (Insolvency) No.920, 922 & 1072 of 2022 17

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