Limitation Act, 1963 – Sections 2(j) and 4 – Applicability to IBC proceedings in light of Section 238A IBC as inserted by the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018 r/w Rule 3 of the NCLAT Rules, 2016: Held: The resolution plan of the appellant was approved by the NCLT vide order dated 07.04.2022 – Though the Company Secretary of the appellant duly informed the listing departments of both NSE and BSE about the NCLT order within 30 minutes of its pronouncement, the intimation of the said approval was given by the BSE and NSE only on 08.04.2022, making the respondent aware of it only then – The limitation period for filing the appeal commenced on 07.04.2022 and expired on 07.05.2022, a working Saturday for the registry of the NCLAT – The appeal, along with an application for condonation of delay was e-filed before the NCLAT on 23.05.2022 and physically filed on 24.05.2022 by the respondent no.1 herein – The NCLAT condoned the delay vide impugned order.
Section 238A IBC makes the Limitation Act, 1963 applicable to IBC proceedings – Section 2(j) of Limitation Act defines the terms ‘period of limitation’ and ‘prescribed period – Section 4 of Limitation Act states that when the prescribed period for any suit, appeal or application expires on a day when the court is closed, the suit, appeal or application may be instituted, preferred or made on the day when the court reopens including days wherein it is closed during any part of its normal working hours – Rule 3 of the NCLAT Rules, 2016 also extends the prescribed period of limitation to the next working day when the period ends on a day when the office of the Tribunal is closed. [Paras 10, 10.1]
Thus, the benefit of exclusion of period during which Court is closed is available only when application for setting aside the award is filed within “prescribed period of limitation” and it is not available in respect of period extendable by the Court in exercise of its discretion [Para 10.2]
IBC, 2016 – Section 61(2) – Computation of limitation period in appeals – Limitation period for filing an appeal to the NCLAT commences from the date of pronouncement of the order by the NCLT – Though Rule 22(2) of the NCLAT Rules mandates filing of a certified copy of the impugned order along with the appeal, the limitation period is not contingent upon the receipt of such a copy:
Held: The total permissible period for filing an appeal under Section 61(2) gives a total permissible period 45 days to appeal i.e., comprising 30 days as the prescribed period and an additional
15 days that may be condoned upon showing sufficient cause – In V. Nagarajan v. SKS Ispat & Power Ltd., (2022)2 SCC 244 this Court held that the Limitation period for filing an appeal to the NCLAT commences from the date of pronouncement of the order by the NCLT and not from the date when the order is received or made available to the aggrieved party – Though Rule 22(2) of the NCLAT Rules mandates filing of a certified copy of the impugned order along with the appeal, the limitation period is not contingent upon the receipt of such a copy – If in case an appellant applies for a certified copy, the time taken to obtain it can be excluded from the limitation period under section 12(2) of the Limitation Act – The litigant has to file its appeal within thirty days, which can be extended up to a period of fifteen days, and no more, upon showing sufficient cause – In Sanjay Pandurang Kalate v. Vistra ITCL India Ltd. & Others, (2024) 3 SCC 27; A. Rajendra v. Gonugunta Madhusudhan Rao & Others, 2025 SCC OnLine SC
721 – The Court held that date on which the limitation begins to run is intrinsically linked to the date of pronouncement – Where the judgment was pronounced in open Court, the period of limitation starts running from that very day. [Para 10.3] The IBC prescribes strict timelines for filing appeals and taking legal action so as to ensure that insolvency proceedings are not misused to recover time-barred debts – The NCLAT cannot condone any delay beyond 15 days even on equitable grounds as the appellate mechanism under IBC is strictly time-bound by design to preserve the speed and certainty of the insolvency resolution process. [Paras 11, 11.1]
The impugned order of the NCLAT is ultravires as it has no power to condone delay beyond the period stipulated under the statute – Allowing condonation in such cases would defeat the legislative intent and open the floodgates to belated and potentially frivolous petitions, thereby undermining the efficacy and finality of the appellate mechanism. [Paras 11-13].
As published in the Supreme Court Reports, Supreme Court of India. Headnotes prepared by: Swathi H. Prasad, Hony. Associate Editor (Verified by: Kanu Agrawal, Adv.) (2021) 10 SCC 401. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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