National Company Law Appellate Tribunal
Negolice India Limited & Anr vs Preeti Jaikishan Bhagchandka & Ors on 8 February, 2024
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NATIONAL COMPANY LAW APPELLATE TRIBUNAL
PRINCIPAL BENCH
NEW DELHI
COMPANY APPEAL (AT) NO.104/2023
&
IA NO.2612/2023
In the matter of:
Negolice India Limited & Ors Appellants/Petitioners
Vs
Preeti Jaikishan Bhagchandka & Ors Respondent
For Appellants: Mr Sumesh Dhawan, Mr. Shantano Tyagi, Mr
Raghav Dembla, Ms Purnima Mathur, Advocates.
For Respondent: Mr Abhijeet Sinha, Mr Aseem Chaturvedi, Ms
Trishala Trivedi, Ms Phalguni Nigam, Advocates for R1.
ORDER
( 08-02-2024) IA No.2612/2023 in Comp App (AT) No.104/2023 PREFACE The Petitioners/Appellants have preferred the instant IA No.2612/2023 (condone delay application under Section 421 (3) of the Companies Act, 2013 and proviso thereto) in preferring the instant Comp App (AT) No.104/2023. APPELLANTS' PLEAS 2
2. According to the Petitioners/Appellants the impugned order dated 22.03.2023 was passed by the NCLT, New Delhi Bench in IA No.206/2022 in CP No.74/2022. The limitation period of 45 days mentioned in Section 421 (3) of the Companies Act, 2013 for filing an Appeal, expired on 06.05.2023. However, the 'Appeal' came to filed within the further 45 days mentioned in proviso to Section 421 (3) of the Companies Act, 2013.
3. It is represented on behalf of the Petitioners/Appellants that the reasons for the delay of 18 days in preferring the instant 'Appeal' is that the 2nd Appellant being a party before this Appellate Tribunal not only in its individual capacity but as the Managing Director and authorized signatory of the 1st Appellant/1st Petitioner was 'unwell' during this period. Also that the 2nd Appellant had recovered only in the 2nd week of May, 2023 and is now able to execute the instant 'Appeal' and ancillary applications. Therefore, according to the Petitioners/Appellants it was not possible for the 2nd Appellant to instruct the Learned counsel, in regard to the preferring of the instant 'Appeal' and other ancillary applications within the period of 45 days specified in Section 421(3) of the Companies Act, 2013.
4. The Learned counsel for the Appellants takes a stand that the 'condonation application' dated 24.05.2023 appears as a Defected document, on the 'Data Management System', an application used by this Tribunal to see the status of e-filed pleadings.
5. Further, according to the Appellants/Petitioners, the Petitioners/Appellants after rectifying the defects within seven days time, in terms of Rule 26 (2) of the NCLAT Rules, 2016 had re-filed the Appeal Papers 3 with the 'condonation of delay application' on 31.05.2023 and the status of the said application on 31.05.2023 was shown as 'Defect Free' on the 'Data Management System'.
6. The Learned counsel for the Petitioners/Appellants relies on the decision of the Hon'ble Supreme Court in Collector Land Acquisition, Anantnag V. Katiji (1987) 2 SCC at Page 107 wherein it was observed that Courts must take a justice oriented approach in 'condoning the delay' in institution of matters before Courts. Besides, this the Hon'ble Supreme Court of India had further observed that 'Courts shall not approach an application' for condonation of delay, with the presumption of mala fide, on the part of a litigant.
7. The Learned counsel for the Petitioners/Appellants points out that the Petitioners/Appellants had corrected the defects, by rectifying the same and an inadvertent error was committed by the Appellants/Petitioners, in para 3 of the 'condone delay application'.
8. The Learned counsel for the Petitioners/Appellants adverts to the decision of the Hon'ble Supreme Court in Vedabai Vs Shantaram Baburao Patil reported in, 2001 9 SCC at Page 106 wherein it is observed as under:-
"In exercising discretion under Section 5 of the Limitation Act the Courts should adopt a pragmatic approach. A distinction must be made between a case where the delay is inordinate and a case where the delay is of a few days. Whereas in the former case the consideration of prejudice to the other side will be a relevant factor so the case calls for a more 4 cautious approach but in the latter case no such consideration may arise and such a case deserves a liberal approach."
9. On behalf of the Petitioners/Appellants, a reference is made to the decision of the Hon'ble Supreme Court in Maniben Devraj Shah V. Municipal Corporation of Brihan Mumbai (2012) 5 SCC 157 wherein it is observed that 'it is well settled that the expression sufficient cause is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice. The courts are expected to take liberal approach in such matters where refusal to condone delay is likely to result in a meritorious matter being thrown out at the very threshold.'
10. According to the Petitioners/Appellants, if the delay of 18 days is not condoned, an irreparable harm and injury would be caused to the Appellants.
11. The Learned counsel for the Petitioners/Appellants submits that the Petitioners/Appellants in IA No.2612/2023 in Comp App (AT) No.104/2023 have exhibited 'sufficient cause', for the delay of 18 days in filing the instant Appeal on the file of this 'Tribunal'. Therefore, on behalf of the Petitioners/Appellants, the condonation of 18 days delay in preferring the instant 'Appeal' is to be condoned in the interest of justice. 1st RESPONDENTS' CONTENTIONS
12. On behalf of the 1st Respondent, the Learned Senior Counsel submits that the 1st Respondent opposes the IA No.2612/2023 (condone delay application) based on the reasons 5
(i) the Appellants have exhibited sheer disregard to the process of law and dubiously altered their stand in the pre-defect application e-filed on 24th May, 2023 (which forms part of the judicial record) and the final copy of the application placed before this Hon'ble Tribunal on 30 May, 2023 (post curing defects). The application deserves dismissal on this count alone;
(ii) Such a conduct of the Appellants of raising false averments on oath, ought not be condoned much less with imposition of cost in so far as the same would tantamount to setting an incorrect precedent by this Hon'ble Appellate Tribunal;
(iii) In any event, the Appellants have failed to demonstrate/disclose sufficient grounds for seeking condonation.
13. The Learned Senior counsel for the 1st Respondent points out that the Appellants had e-filed the captioned Application on 24.05.2023, a copy of which was served upon the Respondents and in the said e-filing version, the alleged grounds, pleaded by the Appellants for the delay in captioned 'Appeal' was
i) The alleged non-availability of Appellant No.2, the Authorised Representative of the Appellants due to travelling and;
ii) The alleged ill disposition of Appellant NO.2. Pertinently, such e-filing became part of the (judicial records, which is a well-settled Law.
14. According to the 1st Respondent the Appellants, post curing the defects notified by the 'Registry of the Tribunal', dubiously and unscrupulously 6 changed stand in the Application and the only ground pleaded for delay was the alleged indisposition of the 2nd Appellant.
15. The Learned counsel for the 1st Respondent points out the undermentioned 'Tabular Form' will speak for itself about the 'discrepancy' and the 'unscrupulous conduct of the Appellants' and the same is as under:-
24 May (Pg 8-9, Reply to IA 30 May 2023 (Pg 302, Vol 2, Appeal No.2612/2023 "3...The reason for delay is that the "3....The reasons for delay is that the Appellant No.2, who is a party before Appellant No.2, who is a party before this Hon'ble Appellate Tribunal not this Hon'ble Appellate Tribunal not only in his individual capacity but only in his individual capacity but also as the Managing Director and also as the Managing Director and authorized signatory of the Appellant authorized signatory of the appellant No.1 was travelling since first week of No.1 was unsell during this period.
March 2023 and was also unwell The Appellant No.2 has only during this period. The Appellant recovered in the second week of May, NO.2 has only returned in the second 2023 and is now able to execute this week of May, 2023, and is now able Appeal and ancillary applications. As to execute this Appeal and ancillary such, it was not possible for the applications. As such, it was not Appellant No.2 to instruct counsel possible for the Appellant NO.2 to with respect to the filing of the present instruct counsel with respect to the Appeal and ancillary applications filing of the present Appeal and within the period of 45 days ancillary applications within the 7 period of 45 days prescribed in prescribed in Section 421(3) of the Section 421(3) of the Companies Act, Companies Act, 2013. 2013"
16. The Learned counsel for the 1st Respondent points out that the Appellants/Petitioners had changed their stand and made false averments on 'Oath' in a mala fide manner only to mislead this Tribunal into passing a favourable order further when a person/party is curing defects. It is only rectifying the defects, pointed out by the Registry of this Tribunal and not changing/modifying the contents of its plea.
17. It is represented on behalf of the 1st Respondent that in its 'Rejoinder', the Appellants have pleaded that such an e-filed application, does not form part of Record and cannot be relied upon. Further the conduct of the Appellants ought not to be condoned much less with an award of 'costs' (which would not be suffice, given the strange facts of the instant case). In so far as allowing the instant Application would not only amount to allowing the complete lackadaisical and recalcitrant approach shown by the Appellants in preferring the 'Application' and the accompanying Appeal but would also amount to setting an incorrect precedent.
18. According to the 1st Respondent the 'purported reasons', projected by the Appellants/Petitioners do not constitute sufficient cause/reasons or adequate and bonafide reasons, for the 'condonation of delay' as per Section 421(3) of the Companies Act, 2013.
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19. Moreover, according to the 1st Respondent, if a 'person' is found to be negligent and fails to act in a bona fide manner or is found to have not acted diligently or remained inactive, the same cannot be a 'sufficient reason' to condone the delay in question.
20. According to the 1st Respondent, the Appellants/Petitioners have pleaded in his 'Rejoinder' to the 'Reply Application' as an 'after thought' of the authorized representative would not constitute a sufficient ground for seeking condonation. Therefore, the delay had occasioned based on Appellants' deliberate and conscious inaction of not filing instant Appeal within the prescribed time.
21. The Learned counsel for the 1st Respondent takes a stand that in the IA No.2612/2023 in Comp App (AT) No.104/2023 the bald averments were made by the Appellants/Petitioners but no evidence/documents in support thereof were placed on record, either with the pre-defect Application or with the Application placed before this Tribunal, post curing the defects.
22. The Learned counsel for the 1st Respondent points out that any 'Appeal' filed belatedly, can be condoned only, when cogent justification or sufficient reasons are produced before the Tribunal/Court for justifying the 'Delay'. As a matter of fact the justification offered by the Petitioners/Appellants is filmsy and in a casual manner and they are not to be accepted by this Tribunal and hence the 'condone delay application' i.e. IA No.2612/2023 in Comp App (AT) No.104/2023 is to be dismissed, in the interest of justice. 1ST RESONDENTS' DECISIONS 9
23. The Learned counsel for the 1st Respondent refers to the decision of this Tribunal in Company Appeal (AT)(Ins) No.1293/2022 dated 21.12.2022 between Adisri Commercial Pvt Ltd, shareholder of Srei Infrastructure Finance Ltd V. Reserve Bank of India and Another reported in 2022 SCC Online NCLAT 1611 wherein at paragraph 19 and 20 it is observed as under:-
"19. Any question of delay condonation must go through deep and sufficient scrutiny in the context of the Code. The circumstances cited for condonation of delay in re-filing has to be in consonance with the aims and objects of the Code and not frustrate the scheme of the Code. The natural corollary that follows is that condonation of delay in re-filing is not available just for the asking. This Tribunal needs to be fully satisfied that the delay was unavoidable and the applicant was consistently diligent in pursuing the matter. The question of condoning any delay in re-filing would have to be considered in the context of the plausible explanation given to show that the delay was on account of reasons beyond the control of the applicant and could not be avoided despite all possible efforts by the applicant.
20. We now proceed to test the conduct of the applicant on the anvil of whether the applicant acted with due diligence and dispatch. From the submissions and pleadings made by the Appellant, three grounds have been cited for the delay. The first ground raised has been the ill-health of the authorised representative. This has been contested by the Respondents on the grounds that the ill-health of one representative of the company cannot be a justified reason for having stalled the refiling of 10 the appeal for 321 days and that the company could have authorised any other representative to undertake the re-filing of the Appeals. We also note that apart from a general statement, no proof of illness has been placed on record. Furthermore, there is substance in the argument raised by the Respondents that the Company could always have deputed another authorised representative to complete the task of refiling if it was serious. That the Appellant has admitted that they were pursuing another parallel litigation in another court during this period also shows that the grounds raised for inaction in the present refiling is only a pretence. In the face of such gross inaction on the part of the Appellant company, we are not convinced of this ground to be a good enough for condonation of delay."
24. The Learned Counsel for the 1st Respondent cites the decision of this Tribunal in Laly Joseph V Indo Asian New Channel Pvt Ltd & Ors, Company Appeal (AT)(CH)No.54/2023 reported in MANU/NL/0640/2023 wherein at paragraph 7 and 8 it is observed as under:-
"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 11 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 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."
25. The Learned counsel for the 1st Respondent refers to the decision of this Tribunal dated 25.04.2023 in Gurusharan Singh Sawhney V Harkiran Kaur Sawhney and Ors, Company Appeal (AT) No.53 of 2023 reported in MANU/NL/0392/2023 wherein at para 7 it is observed as under:-
"7. On examination of the aforesaid statement, it is evident that no plausible reason has been assigned for delay in filing the appeal. Under provision contained in Section 421 an appeal is to be filed within 45 days, however if further after expiry of 45 days appeal is not filed, then thereafter this tribunal is not competent to entertain the appeal. However, if during extended within 45 days, a party in a position to satisfy the court regarding the reasonable ground for delay, this court may entertain such petition. Considering the statement made in the condonation 12 petition, we are not satisfied that any plausible explanation has been given for delay in filing the appeal. Normally, in condonation of delay application, it is required on the part of the party to explain day to day delay, however, in the present application no such explanation has been given and as such we don't find any ground to condone the delay. The appeal stands dismissed on the ground of limitation itself."
26. The Learned counsel for the 1st Respondent adverts to the decision of this Tribunal dated 26.07.2023 in Principal Commissioner of Customs V Mr. Rajendra Prasad Tak Company, Company Appeal (AT)(CH)(Ins) No.218/2023 wherein at para 11 it is observed as under:-
"11. It is pertinent to mention that the Hon'ble Supreme Court in the case of `National Spot Exchange Limited' Vs. `Mr. Anil Kohli, Resolution Professional for Dunar Foods Limited' in Civil Appeal No. 6187/2019, dealing with this aspect of the matter that as to whether the Appellate Authority has the jurisdiction to condone the delay beyond the period of 15 days provided in the proviso to Section 61(2) of the Code held that:
"11.2 In the case of Teri Oat Estates (P) Ltd. v. U.T. Chandigarh, reported in (2004) 2 SCC 130, in paragraphs 36 & 37, it is observed as under:
"36. We have no doubt in our mind that sympathy or sentiment by itself cannot be a ground for passing an order in relation whereto the appellants miserably fail to establish a legal right. It is further trite that despite an extraordinary constitutional jurisdiction contained in Article 142 of the 13 Constitution of India, this Court ordinarily would not pass an order which would be contravention of a statutory provision.
37. As early as in 1911, Farwell, L.J. In Latham v. Richard Johnson & Nephew Ltd. (1911-12) All ER Rep 117 observed: (All ER p. 123E) "We must be very careful not to allow our sympathy with the infant plaintiff to affect our judgment. Sentiment is a dangerous will o' the wisp to take as a guide in the search for legal principles"
Thus, considering the statutory provisions which provide that delay beyond 15 days in preferring the appeal is uncondonable, the same cannot be condoned even in exercise of powers under Article 142 of the Constitution. 12. In view of the afore-stated settled proposition of law and even considering the fact that even the certified copy of the order passed by the adjudicating authority was applied beyond the period of 30 days and as observed hereinabove there was a delay of 44 days in preferring the appeal which was beyond the period of 15 days which maximum could have been condoned and in view of specific statutory provision contained in Section 61(2) of the IB Code, it cannot be said that the NCLAT has committed any error in dismissing the appeal on the ground of limitation by observing that it has no jurisdiction and/or power to condone the delay exceeding 15 days."
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27. The Learned counsel for the 1st Respondent points out the decision dated 27.07.2023 in Company Appeal (AT)(CH)(Ins) no.208/2023 between A Sai Siva Jyothi V. Ms Sripriya Kumar RP of M/s Prasad Properties & Investments Pvt Ltd wherein at para 8 it is observed as under:-
"8. Be that as it may, the Appellant then took further period of 15 days i.e. the appeal has been filed on the last day of the extended period of 15 days without giving any cogent reason for not preferring the appeal within the statutory period or even before that. The only reason given is that after she came to know the impugned order dated 22.03.2023 on 26.03.2023, she collected relevant documents and filed the appeal. The reason assigned in this application is not at all sufficient for the purpose of condonation of delay and it appears to us that the Appellant is not taking the period, within which the appeal is to be filed, seriously rather it appears that there is a perception that the condonation of delay is a matter of right."
28. The Learned counsel for the 1st Respondent falls back upon the decision dated 24.08.2023 between People's all India Anti-Corruption and Crime Prevention Society (IP) V. Usha International Ltd & Ors wherein at para 16 to 18 it is observed as under:-
"16. This question has been answered by the Tribunal which is reproduced as under:
"The limitation prescribed in filing an appeal under Section 61 of the Code or Section 421 of the Companies Act, 2013 shall not govern the period taken in an appeal for removal of the defects in 15 refiling/re-presentation. Even if, there is a delay in refiling/ re- presentation which is more than the period of limitation prescribed for filing an appeal undersection 61 of the Code and Section 421 of the Companies Act, 2013, the same can be condoned on sufficient justification."
17. In view of the aforesaid, one thing is settled that in application for condonation of delay in refiling of appeal, the Applicant / Appellant has to give sufficient reason for not re-filing the appeal within the time prescribed. In the present case, as we have narrated the facts hereinabove, the appellant has been totally casual in approaching this court time and again for the purpose of re-filing inasmuch as the defects have been shown for the first time on 01.02.2022 were not cured. In this regard, we may hasten to add that one of the objections was with regard to the cause title namely, Cause title is defective in whole appeal paper book write, "2022 instead of 2021". Even this was not corrected by the Appellant which speaks volumes about their act and conduct and disentitles them from seeking condonation of delay in the present application.
18. With the aforesaid observations, we are satisfied that there is no sufficient cause assigned by the Appellant for the purpose of condonation of delay in re-filing of the appeal. Consequently, the application bearing IA no. 3685 of 2022 is hereby dismissed."
29. The Learned counsel for the 1st Respondent relies upon the decision dated 11.07.2022 in The Regional Provident Fund Commissioner Employees 16 Provident Fund Organisation V Mr. Vasudevan Resolution Professional and Liquidator of M/s Titanium Tantalum Products Limited, Company Appeal (AT)(CH)(Ins) no.182/2022 wherein at para 41 it is observed as under:-
"Aspect of Delay:
41.It is to be remembered that the length of the delay is immaterial.
However, the acceptability of an explanation furnished by the 'Party' is the 'prime criterion'. A Tribunal or a Court of Law will be very reluctant/slow to execute the delay to lend a helping hand/assistance to a 'Litigant'/Stakeholder who is guilty of ínaction' or bad faith or latches or negligence."
30. The Learned counsel for the 1st Respondent refers to the order dated 05.09.2023 in DS Kulkarni Associates V. Manoj Kumar Aggarwal, company appeal (AT)(Ins) No.924 of 2023 wherein at para 7 it is observed as under:-
"7. Section 61(1) provides a right of appeal to a person aggrieved by the order of the Adjudicating Authority. Section 61(2) further provides a period of 30 days for filing the Appeal before the Appellate Tribunal under Section 61(1) of the Code. In case, the Appeal is not filed within the prescribed period of 30 days, proviso to Section 61(2) provides for a period of 15 days within which the Appeal can be filed satisfying the Appellate Authority that there was sufficient cause for not filing the Appeal earlier. However, the period of 15 days cannot be extended and the Appellate Tribunal does not have jurisdiction to consider and condone the delay beyond the period of 15 days and in case the Appellate Authority is satisfied that there has been a sufficient cause for not filing 17 the Appeal within the time prescribed or within the extended period, it can condone the delay and hear the matter on merits. Therefore, sufficient cause is the heart and soul of the application for condonation of delay which is totally missing in this Application."
31. The Learned counsel for the 1st Respondent refers to the decision dated 22.09.2023 between Srei Infrastructure Finance Ltd V. Uday Narayan Mitra, Company appeal (AT)(Ins) No.212 of 2023 wherein it is observed as under:-
"On perusal of the statement made in the condonation of delay application we are satisfied that no such reason has been assigned. Moreover, once the appeal was filed belatedly, it was expected on the part of the appellant to bring on record certified copy of the order. However, in this case an exemption application has been filed. We would have considered to take lenient view in the matter had on the first day when the main appeal was taken up, the appellant had requested for condonation of delay but to the reasons best known to the appellant consecutively on number of dates despite the fact that the appeal was taken up no submission was made that the appeal was filed belatedly. Under Section 61of the I.B. Code, for filing an appeal limitation period is prescribed as 30 days and thereafter in further 15 days if the parties are in position to satisfy the court that there was sufficient plausible reason for non filing of appeal within said period the court can condone the delay but only within extended period of 15 days. However, considering the ground set forth in the application as well as none disclosure by the Appellant to the Court regarding filing of the condonation of delay 18 application on number of dates, we are not inclined to entertain the condonation of delay application. Accordingly, the condonation of delay application i.e. I.A. No. 769 of 2023 stands dismissed. Consequently, the appeal too is dismissed."
32. The Learned counsel for the 1st Respondent adverts to the decision dated 18.01.2024 between Mr. A Rajendra, ex Shareholder and suspended Board of Director of Dharti Dredging & Infrastructure Ltd Vs. Mr. Gonugunta Madhusudhan Rao RP of Dhart Dredging & Infra Ltd & Or in Company Appeal (AT)(CH)(Ins) No.364 of 2023 wherein at para 15 it is observed as under:-
"15. Thus, from the aforesaid discussion, three issues emerges in this case, firstly, the Appellant is guilty of suppressio veri and suggestio falsi who has made a totally wrong averments in para 6 and 17 of the grounds of appeal which has been declared and verified to be correct and also filed an affidavit in support of it because, firstly, the appeal is not within the limitation though a declaration is made in para 6 of the grounds of appeal that the Appeal is within the period specified in Section 61 of the Code and secondly the Appellant has obtained the certified copy (paid copy) applying the same for it on 01.08.2023 and received the same on 10.08.2023, therefore, the period of 10 days deserves to be excluded in terms of the Section 12 of the Act, 1963. Secondly, the Appellant has not even applied for the certified copy (paid copy) at all in filing of the appeals and even one application has been filed i.e. I.A. No. 1118 of 2023 for dispensing with the filing of the certified copy. Thirdly, the Appellant has taken totally a new stand in the application for condonation of delay 19 when an objection was raised by the Respondents that the appeal is not within the period of limitation. In the application filed for condonation of delay, the ground taken is that the limitation is to be counted from the date when free certified copy was made available in so far as the first appeal is concerned whereas no such plea has been taken in so far as the second appeal is concerned in which the averment has been made that the appeal has been filed with the copy given by the RP and lastly even if there is a delay of 10 days for which the application has been filed for condonation of delay, no ground has been made out for the purpose of condoning the delay which would fall within the parameters of sufficient cause and finally the case of the Respondent is fully covered by the decisions of the Hon'ble Supreme Court rendered in the case of V. Nagarajan (Supra) and Sanjay Pandurang Kalate (Supra)."
33. The Learned counsel for the 1st Respondent refers to the decision dated 18.07.2023 between Micron Electricals V Aishwarya Heights Infra Pvt Ltd, Company Appeal (AT)(CH) (Ins) No. 203/2023 wherein at para 7 and 8 it is observed as under:-
"7. Any person, who is aggrieved by an order of the Adjudicating Authority, has a right to appeal but for that purpose a period of 30 days has been prescribed. In case, the Appellant fails to file the appeal within the period of 30 days due to some reasons which is justifiable or constitute a sufficient cause, the appeal still can be filed within a period of 15 days but it cannot be extended any further beyond the period of 15 20 days in view of the Judgment of the Hon'ble Supreme Court in the case of National Spot Exchange Limited (Supra).
8. The Appellant has given a lame excuse for not filing the appeal in time (30 days) on the ground that the person who had to file the appeal is 74 years of age but it is nowhere mentioned in the application much less the affidavit attached that he was infirm and incapable of engaging the counsel for the purpose of filing the appeal. It appears to us that there has been a totally causal approach of the Appellant in coming to this Court in appeal beyond the period of 30 days and without any sufficient cause. In view thereof, we are of the considered opinion that there is hardly any merit in this application which requires our consideration and interference, consequently, the application is found devoid of any merit and the same is hereby dismissed. No costs."
34. The Learned counsel for the 1st Respondent cites the decision dated 27th July, 2023 between DCB Bank Limited V Ramakrishnan Sadasivam & 3 Ors, Company Appeal (AT)(CH) No.207/2023 wherein at para 12 onwards it is observed as under:-
"12. Now, the question is as to whether there is a sufficient cause assigned by the Appellant for the purpose of condoning the delay. Although the limitation to challenge the impugned order started w.e.f. 03.03.2022 but even if it is presumed that the Appellant was pursuing its other remedy to challenge the order of exparte itself and had remained unsuccessful till the Hon'ble Supreme Court when its Civil Appeal was also dismissed on 06.04.2023 and the period of limitation is to be 21 counted from 06.04.2023, the period of 30 days for the purpose of filing of this appeal had expired on 06.05.2023. If 15 days more are added which are prescribed under Section 61(2) proviso then the period of 45 days would have expired on 21.05.2023 whereas the present appeal has been filed on 22.05.2023, even after the expiry of period of 15 days as well which cannot be condoned in any manner in view of the decision of the Hon'ble Supreme Court in the case of National Spot Exchange Limited (Supra).
13. Looking from any another angle, even if it is taken then that the appeal has been filed on 15th day of the extended period of 15 days even then there is no sufficient cause assigned by the Appellant as to why it had taken exactly 45 days in filing the appeal against the order dated 03.03.2022. The reasons are conspicuous by its absence especially when the Appellant is a Bank who had huge machinery at its disposal for the purpose of preparing the appeal and filing the same within the statutory period of 30 days.
14. Thus, looking from any angle, we do not find any reason to interfere in this application because of the absence of sufficient cause for condonation of delay to our satisfaction. Consequently, the application is dismissed. No costs."
PETITIONERS'/APPELLANTS' REPLY
35. The Learned counsel for the Petitioners/Appellants in reply points out that the Interlocutory Application for condonation of delay dated 24.05.2023 22 filed by the Appellants was not admitted and registered by this Appellate Tribunal, as per Rule 26(2) of the NCLAT Rules, 2016.
36. The Learned counsel for the Petitioners/Appellants makes a useful reference to Rule 26(2) of the NCLAT Rules, 2016 which reads as under:-
"(2) If, on scrutiny, the appeal 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."
37. According to the Learned Counsel for the Petitioners/Appellants the 'Application' seeking 'condonation of delay' dated 24.05.2023 was never taken on Record because of the defects, the 1st Respondent cannot make submissions based on the same. Moreover, the Petitioners/Appellants has refiled the captioned 'Appeal' alongwith a Petition seeking 'condonation of delay' dated 30.05.2023, in and by which the Petitioners/appellants had cured all the defects in the Appeal as well as in the Application for condonation of delay. In fact the Appellants/Petitioners while rectifying the defects had also corrected an inadvertent error in its Application seeking condonation of delay dated 24.05.2023.
38. The Learned counsel for the Petitioners/Appellants comes out with the plea that in the Application seeking 'condonation of delay' dated 24.05.2023 as well as dated 30.05.2023, the Petitioners/Appellants had consistently mentioned that the Managing Director and authorised signatory of the 23 Appellant No.1 was unwell during the period when the captioned appeal was supposed to be executed.
39. It is represented on behalf of the Petitioners/Appellants that there was 'no concealment' on Appellants/Petitioners part, relating to the reason for delay in filing the captioned Appeal.
40. According to the Petitioners/Appellants, the 1st Respondent is endeavouring to take focus from the main issue in the captioned Appeal i.e. impleadment of Respondent No.4 i.e. Mr. Jaikishan Bhagchandka in the Company Petition No.74/2022 instituted by the Respondent No.1 herein titled as Preeti Bhagchandka V Negolic India Ltd and Ors which is pending before the NCLT, New Delhi.
41. According to the Petitioners/Appellants, on 01.05.2023 the authorised signatory of the Appellant No.1 was advised bed rest for two weeks viz. till 14.05.2023, owing to Tooth Extraction, Tooth Implants and Root Canals. Further, the impugned order was passed on 22.03.2023 in IA No.206/20222 in CP No.74/2022 and the limitation period of 45 days mentioned in Section 421 (3) of the Companies Act, 2013 for preferring an Appeal expired on 06.05.2023. That apart, the Authorised signatory of the 1st Appellant, was 'unavailable' for executing the Appeal and the 'Application' seeking 'condonation of delay in filing the Appeal' as, he was advised bed rest (vide the medical prescription dated 01.05.2023 of the Authorised signatory of the 1st Appellant), and the aforesaid reasons constitute sufficient cause and bona fide grounds for the condonation of delay of 18 days as per Section 421(3) of the Companies Act, 2013.
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42. In the 'Rejoinder,' of the Petitioners/Appellants (to the Reply of 1st Respondent to the Application filed by the Petitioners/Appellants for condonation of delay in preferring the instant Appeal as per Section 421(3) of the Companies Act, 2016) the Annexure A-1, the Sterling Dental Clinic", New Delhi certificate dated 01.05.2023 in respect of Mr. Mahesh Kumar Bhagchandka shows that 'patient complains of pain in lower front teeth. Sensivity to hot and cold. Bleeding from gums and swelling.' In fact, the treatment plant -Emergency reads as under:
Extraction of 31, 41, 34. Root canal treatment, 32, 33. Implant with 31, 34, 41 etc.
43. Furthermore, in the said Dental Clinic certificate dated 01.05.2023 it is mentioned that 'patient will be without front lower teeth. So he is advised to rest and stay at home for 'two weeks' and under the caption Treatment it is mentioned as Extraction of 31, 34, 41, Medication prescribed.
44. It is projected on the side of the Petitioners/Appellants that their 'stance' in regard to condonation of delay in filing the instant Appeal has remained consistent prior to and post connecting/curing the defects in the Appeal. Also the Learned counsel for the Petitioners/Appellants points out that the instant Appeal is filed within further 45 days mentioned in the proviso to Section 421(3) of the Companies Act, 2013.
DISCUSSIONS:
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45. The Petitioners/Appellants in IA 2612/2023 in Company Appeal (AT) No.104/2023 have prayed for the delay of 18 days in preferring the instant Company Appeal (AT) No.104/2023 on the file of this Tribunal mentioning that the impugned order came to be passed, on 22.03.2023 and the limitation for preferring the Appeal as per Section 421(3) of the Companies Act, 2013 is 45 days and the time for preferring the Appeal got expired on 06.05.2023. However, the Appeal was filed before this Tribunal within further 45 days mentioned in the proviso to Section 421(3) of the Companies Act, 2013.
46. According to the Petitioners/Appellants the 2nd Appellant being a party before this Tribunal not only in his individual capacity but also as Managing Director and authorised signatory of the 1st Appellant was 'unwell' during this period. Moreover, the 2nd Appellant had recovered from illness in the 2nd week of May, 2023 and was able to execute the instant Appeal and other ancillary applications. Therefore, it was not possible for the 2nd Appellant to instruct Advocate with regard to the preferring of the Appeal and ancillary applications within 45 days period mentioned in Section 421(3) of the Companies Act, 2013.
47. The 1st Respondent has taken a contra stand that the Petitioners/appellants have exhibited sheer disregard to the 'process of law' and dubiously altered their stand in the pre-defect application, e-filed on 24.05.2023 and the final copy of the application was placed before this Tribunal on 30.05.2023 (post curing defects) and that apart, the Appellants/Petitioners have failed to disclose sufficient reasons for seeking 'condonation of delay'.
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48. According to the 1st Respondent, the indisposition plea qua the alleged tooth extract (as averred by the Appellants in its Rejoinder to the Reply to the application is purely an 'after thought') of the authorised representative would not cause a 'sufficient ground' for seeking condonation. Moreover, a party/person is not to change/modify/alter the contents of its plea and further he/it is only to cure the defects pointed out by the 'Office of the Registry' of this Tribunal.
49. It is projected on the side of the 1st Respondent that in case a party files an Appeal beyond the period of 45 days, (specified under Section 421 of the Companies Act, 2013) the said delay will not be condoned, in the event, unless the concerned person demonstrates sufficient and just cause for not preferring such an Appeal within the statutory period.
43. The Petitioners/Appellants in their Rejoinder have averred that the Managing Director and the authorised signatory of the 1st Appellant was unwell during the period when the instant Appeal was supposed to be executed. Further, the Petitioners/Appellants in their Rejoinder to IA 2612/2023 in Comp App (AT) No.104/2023 have averred that the filing of 'condoned delay application' dated 24.05.2023 was returned to them by the 'Office of the Registry' of this Tribunal owing to certain defects and the same was never taken on record and it was not subject to adjudication, by this Tribunal and, therefore, no reliance can be placed on the side of the 1st Respondent in this regard.
50. According to the Petitioners/Appellants, the authorised signatory of the 1st Appellant was advised bed rest for two weeks on 01.05.2023 till 27 14.05.2023, owing to 'tooth extraction' , tooth implant and root canals. Apart from that, the limitation period for preferring an Appeal by the Petitioners/appellants expired on 06.05.2023 by taking into account of the impugned order which was passed on 22.03.2023. Because of the non- availability of the authorised signatory of the 1st Appellant, on 06.05.2023, the Appeal Papers and the condonation delay application were not executed, because he was advised bed rest.
51. The Petitioners/Appellants have produced a medical certificate dated 01.05.2023 (vide Annexure A-1 of Rejoinder) from the Sterling Dental Clinic, New Delhi, in respect of Mahesh Kumar Bhaagchandka and the perusal of the said certificate shows that extraction of 31, 34, 41 etc. was done and the medication was prescribed and in fact the patient was advised to rest and stay at home for a period of two weeks.
52. In respect of 'condone delay application' a balance is to be struck between sufficient cause and the compensation which cost must be substantial as per decision in Gokulnanda Mohanti V. Ramibala Mohanty, 1998 1 CCC 495 vide para 9.
53. In respect of short delays concerning condonation, there is no ambit to impute any inaction or negligence or lack of bona fide as per decision in LIC V. BA & Brothers (Eastern) Ltd, Indian Civil Cases 5 (Cal). Moreover, the determining factor is whether there is plausible or reasonable explanation for the delay in question, in filing the Appeal.
54. What counts is not the length and breadth of delay. The Tribunals are meant for 'imparting justice' and 'not to scuttle justice'. Indeed the 28 'power of condoning the delay', is to be considered by the concerned Court/Tribunal in consonance to the circumstances encircling the consideration of delay, in each respective cases.
55. Where the delay in preferring an Appeal/Restoration Application/Review etc. is not wanton or intentional, the Court would not be justified in rejecting the 'delay condonation application' on the basis that the Applicant had not produced a medical certificate, to show that he/she was ill and the Doctor had advised him/her to take rest, as per decision in Marry Susheela V. Shalee Kasturibai 2014, AIR CC 2445 (Mad).
56. When substantial justice and technical consideration are pitted against each other, cause of substantial justice deserves to be preferred, for the opposite party, cannot claim to have vested right in justice being denied to him / them, because of a non-deliberate delay. There cannot be any presumption or assumption that the delay as occasioned, wantonly, or on account of culpable negligence or on account of malafides.
57. It cannot be forgotten that a stakeholder/litigant does not stand to be benefit by adopting to any kind of delay. It cannot be brushed aside that a Tribunal is respected not on account of its authority to legalise injustice on technical ground but because it is capable of removing injustice. After all, refusing to condone the delay can even result in a 'meritorious matter' being thrown out at the early stage and cause of justice being defeated. Also that, when the delay in question is condoned, the highest thing that can happen is that the case will be decided on merits after hearing the parties. 29
58. As far as the present case is concerned, even though on the side of the 1st Respondent, a plea, is taken that the Petitioners/Appellants have exhibited sheer disregard to the process of law and dubiously altered the stand in the pre-defect application filed on 24.05.2023 and the final copy of the Petition placed before this Tribunal, on 30.05.2023 (post curing defects) and continuing further, has pointed out the purported discrepancy and the conduct of the Petitioners/Appellants in the tabular form as culled out in para 8 of this order, this Tribunal, is of the considered view that the Petitioners/Appellants in paragraph 3 of IA 2612/2023 in instant Comp App (AT) No.104/2023 had averred that the 2nd Appellant not only in his individual capacity being a party before this Tribunal but also as MD and authorised signatory of the Appellant No. 1 was unwell during this period and further that the 2nd Appellant had recovered in the 2nd week of May, 2023 and was not able to execute the Appeal and ancillary applications etc., this Tribunal, is of the considered view that the Petitioner/Appellants have consistently mentioned that the Manging Director and the authorised signatory of the 1st Appellant was unwell during the period and in fact, on the behalf of the Petitioner/Appellants, a Medical Certificate from Sterling Dental Clinic dated 01.05.2023 was produced in respect of Mr. Mahesh Bhagchandka(the 2nd Appellant and MD of Appellant No. 1) which indicates that the 2nd Appellant and MD of Appellant No. 1 was under treatment for extraction of 31,34,41 and the patient was advised to rest and stay at home for two weeks, and in any event the delay of 18 days in the present Appeal is satisfactorily explained on the side of the Petitioners / Appellants, as sufficient/bonafide cause, and when no negligence or inaction nor want of bonafides is attributable to a party 30 for the delay in filing a remedy, then, it certainly constitute a sufficient cause in the present Appeal as held by this Tribunal.
59. Be that as it may, this 'Tribunal' on a careful consideration of respective contentions, on going through the facts and circumstances of the instant case comes to a 'cocksure conclusion' that the delay of 18 days in preferring the instant 'Appeal' has occurred on account of the indisposition of the 2nd Appellant, the authorised signatory of the 1st Appellant. Furthermore, on 01.05.2023, five days before the expiry of limitation period, the 2nd Appellant / MD and the authorised signatory of the 1st Appellant underwent tooth extraction, tooth implant etc. and the two weeks period came to an end of 14.05.2023 and the further delay of 10 days from 14.05.2023 to 24.05.2023 had occurred, according to the Appellants in the course of 2nd Appellant furnishing instructions in regard to the preferring of Appeal along with ancillary applications. Viewed in that perspective, this 'Tribunal' by resorting to an elastic approach and the delay of 18 days that has occurred is covered within the further limitation period of 45 days prescribed in proviso to Section 421(3) of the Companies Act, 2013, condones the said delay of 18 days subject to a condition that the Petitioners/Appellants are hereby directed to pay a cost of Rs. 8000/- (Rupees eight thousand only) to the Prime Ministers' Relief Fund to be paid within two weeks from today. The Petitioners/Appellants are directed to produce the original receipt for the proof of payment towards cost of Rs. 8000/- before the 'office of Registry' and the same shall be kept along with the records of the instant Appeal. Accordingly, this 'Tribunal' allows IA NO.2612/2023 in COMPANY APPEAL (AT) NO.104/2023.
31Conclusion In the result, IA NO.2612/2023 in COMPANY APPEAL (AT) NO.104/2023 is allowed. No Costs.
(Justice M. Venugopal) Member (Judicial) (Dr. Alok Srivastava) Member (Technical) Date: 08-02-2024 bm/ss