19-Tata Steel Ltd. vs. Raj Kumar Banerjee & Ors.

Case Number
CIVIL APPEAL/408/2023

Case Title
Tata Steel Ltd. vs. Raj Kumar Banerjee & Ors.

Headnote
The Supreme Court held that the National Company Law Appellate Tribunal (NCLAT) has no power to condone a delay in filing an appeal beyond the maximum period of 45 days (30 days + 15 days) prescribed under Section 61(2) of the Insolvency and Bankruptcy Code, 2016 (IBC). The Court clarified that the benefit of Section 4 of the Limitation Act, 1963, which extends the filing period if the last day is a holiday, applies only to the initial 30-day “prescribed period” and not to the additional 15-day “condonable period.” The NCLAT, being a creature of statute, cannot use inherent or equitable powers to extend the limitation period beyond what is expressly provided in the IBC. The Court set aside the NCLAT’s order that had condoned the delay, reaffirming that the timelines under the IBC are strict and must be adhered to, making even a single day’s delay beyond the 45-day limit fatal to the appeal.

Court
Supreme Court of India

Type
Judgment

SCR Citation
NA

Neutral Citation
2025 INSC 639

Disposal Nature
Appeal Allowed

Case Type
CIVIL APPEAL

Law Type
Insolvency and Bankruptcy Law, Corporate Law, Limitation Law

Judgment Authored by
Hon’ble Justice R. Mahadevan*
Hon’ble Justice J.B. Pardiwala

Date of Judgment
May 7, 2025

Case Start Date
NA

Case Arising From
The appeal arises from an order of the National Company Law Appellate Tribunal (NCLAT) dated December 14, 2022. The NCLAT had allowed an application filed by Respondent No. 1 (an erstwhile shareholder) to condone a delay of 15 days in filing an appeal against an order of the National Company Law Tribunal (NCLT), Kolkata. The NCLT’s order, dated April 7, 2022, had approved the resolution plan submitted by the appellant, Tata Steel Ltd., for the corporate debtor, Rohit Ferro-Tech Limited. The appellant challenged the NCLAT’s decision to condone the delay, arguing that the appeal was filed beyond the maximum permissible time limit under the Insolvency and Bankruptcy Code.

Background and Facts
The appellant, Tata Steel Ltd., was the successful resolution applicant for a company named Rohit Ferro-Tech Limited. Its resolution plan was approved by the National Company Law Tribunal (NCLT) on April 7, 2022. Respondent No. 1, a former shareholder of Rohit Ferro-Tech, was aggrieved by this approval and decided to appeal to the National Company Law Appellate Tribunal (NCLAT).

Under the Insolvency and Bankruptcy Code (IBC), an appeal must be filed within 30 days. This period can be extended by a maximum of 15 more days if there is a sufficient reason for the delay. Respondent No. 1 filed the appeal after the 30-day period had passed but within the additional 15-day window. The NCLAT agreed to hear the appeal by condoning the delay. The appellant, Tata Steel Ltd., challenged this decision, arguing that the NCLAT had miscalculated the time limit and did not have the authority to hear an appeal that was filed out of time.

Timeline

• April 7, 2022: The NCLT, Kolkata, approved the resolution plan submitted by the appellant.
• May 7, 2022: The initial 30-day limitation period for filing an appeal expired. This day was a Saturday.
• May 22, 2022: The additional 15-day condonable period for filing an appeal expired.
• May 23, 2022: Respondent No. 1 e-filed the appeal before the NCLAT (46th day).
• May 24, 2022: Respondent No. 1 physically filed the appeal (47th day).
• December 14, 2022: The NCLAT passed the impugned order, condoning the delay and allowing the appeal to be heard.
• May 7, 2025: The Supreme Court allowed the appellant’s appeal and set aside the NCLAT’s order.

Parties Involved

• Appellant: Tata Steel Ltd. (Successful Resolution Applicant)
• Respondent: Raj Kumar Banerjee & Ors. (Erstwhile Minority Shareholder of the Corporate Debtor)

Procedural History

• Lower Court/Subordinate court/Tribunals Decisions: The National Company Law Tribunal (NCLT), Kolkata, in its order dated April 7, 2022, approved the resolution plan for Rohit Ferro-Tech Limited, submitted by the appellant.
• Appeals: Respondent No. 1 filed an appeal against the NCLT’s order before the National Company Law Appellate Tribunal (NCLAT) with a delay. The NCLAT condoned the delay. The appellant then filed the present appeal in the Supreme Court against the NCLAT’s order condoning the delay.

Issues Framed

1. Whether the appeal filed by Respondent No. 1 before the NCLAT was within the prescribed limitation period of 30 days, plus the additional condonable period of 15 days, as provided under Section 61(2) of the IBC?
2. If not, does the NCLAT have the power to condone a delay beyond the total 45-day period prescribed under the IBC?

Areas of Debate

1. How is the limitation period under Section 61(2) of the IBC calculated, especially when the last day of the initial 30-day period falls on a weekend?
2. Does the benefit of Section 4 of the Limitation Act, 1963 (which extends the deadline if the court is closed) apply to the additional 15-day condonable period, or only to the initial 30-day “prescribed period”?
3. Does the NCLAT, as a statutory tribunal, have any inherent or equitable power to condone delays beyond the explicit 15-day extension allowed by the IBC?

Cases Cited
On behalf of the Appellant:

1. V. Nagarajan v. SKS Ispat Powers Limited & Others ((2022) 2 SCC 244): Cited to argue that the limitation period under the IBC starts from the date of the order’s pronouncement, not its receipt.
2. Kalpraj Dharamshi & Another v. Kotak Investment Advisors Limited & Another ((2021) 10 SCC 401): Cited to establish that the NCLAT cannot condone any delay beyond the statutory 15-day period, even on equitable grounds.
3. Safire Technologies Pvt. Ltd. v. Regional Provident Fund Commissioner & Another (Civil Appeal No. 2212 of 2021): Cited for the same principle as Kalpraj Dharamshi.
4. National Spot Exchange Limited v. Mr. Anil Kohli (Civil Appeal No. 6187 of 2019): Cited for the same principle as Kalpraj Dharamshi.
5. Ajay Gupta v. Raju @ Rajendra Singh Yadav ((2016) 14 SCC 314): Cited to argue that the benefit of Section 4 of the Limitation Act does not apply if the last day falls on a Saturday when the court registry is open.

On behalf of the Respondent:
NA

Acts/Rules/Orders Referred

1. Insolvency and Bankruptcy Code, 2016 (IBC)
   • Type: Act
   • Section 61(2): This section prescribes the limitation period for filing an appeal before the NCLAT. It sets a 30-day period, with a proviso allowing for an extension of up to 15 days for sufficient cause. The Court held that this 45-day limit is absolute and cannot be extended further.
   • Section 238A: This section makes the Limitation Act, 1963, applicable to proceedings under the IBC.
2. Limitation Act, 1963
   • Type: Act
   • Section 4: This section provides that if the prescribed period for filing a suit, appeal, or application expires on a day when the court is closed, it can be filed on the day the court reopens. The Court clarified that this benefit applies only to the initial 30-day “prescribed period” under the IBC, not the additional 15-day “condonable period.”
   • Section 2(j): Defines “period of limitation” and “prescribed period.”
3. NCLAT Rules, 2016
   • Type: Rules
   • Rule 3: This rule deals with the computation of the time period and provides for the exclusion of days when the tribunal is closed. The Court found it had no application in this case because the appeal was filed beyond the total permissible period.

Acts/Rules/Orders Governing the Case

1. Insolvency and Bankruptcy Code, 2016
2. Limitation Act, 1963

Literature Citation
NA

Appearances

• Advocates: Not mentioned.
• Witnesses: NA
• Other Persons: NA

Prayer
The appellant prayed for the setting aside of the NCLAT’s order that condoned the delay in the filing of the appeal by Respondent No. 1.

Evidence & Findings
NA

Petitioner/Appellant/Plaintiff/Accused Arguments
The appellant argued that the appeal filed by Respondent No. 1 was barred by limitation. The key points were:

1. The 30-day limitation period expired on May 7, 2022, which was a working Saturday for the NCLAT registry, so the respondent could have filed the appeal on that day.
2. Even if the period was extended, the total permissible time, including the 15-day condonable period, ended on May 22, 2022.
3. The respondent filed the appeal on May 24, 2022, which was beyond the maximum 45-day limit.
4. The NCLAT has no power to condone a delay beyond the statutory 45-day period.

Respondent/Defendant/Opponent/State Arguments
Respondent No. 1 argued that the delay should be condoned. The main arguments were:

1. The limitation period should start from April 8, 2022, the date he became aware of the order, not April 7, 2022, the date of the order itself, because he was not a party to the original proceedings.
2. The 30-day period ended on a Sunday (May 8, 2022), so it should be extended to the next working day, Monday, May 9, 2022.
3. Counting from May 10, 2022, the 15-day condonable period ended on May 24, 2022, the day he physically filed the appeal.
4. The delay was not deliberate but was due to difficulties in obtaining the necessary documents, as he was not a party to the NCLT proceedings.

Ratio Decidendi

1. The limitation period for filing an appeal under Section 61(2) of the IBC is a strict 30 days, with a maximum condonable period of an additional 15 days. The NCLAT, being a creature of statute, has no inherent power to extend this period further on any grounds, including equitable ones.
2. The benefit of Section 4 of the Limitation Act, 1963 (which extends the time if the last day is a holiday) is only available for the initial “prescribed period” of 30 days. It does not apply to the subsequent 15-day “condonable period.”
3. The time for filing an appeal starts from the date of the pronouncement of the order by the NCLT, not from the date of its receipt or the date the party becomes aware of it.
4. The timelines prescribed under the IBC are fundamental to its objective of ensuring a speedy resolution process. Allowing delays beyond the statutory maximum would undermine the efficacy and finality of the appellate mechanism.

Final Decision
The appeal is allowed. The order of the NCLAT dated December 14, 2022, which condoned the delay in filing the appeal, is set aside. There is no order as to costs.

Legal Jargons and Maxims

1. Condonation of Delay: The act of a court overlooking a party’s failure to file a document or take an action within the prescribed time limit, usually upon showing “sufficient cause.”
2. Ultra Vires: A Latin term meaning “beyond the powers.” An act that is ultra vires is one that is done without legal authority.
3. Prescribed Period: The initial time limit set by a statute for taking a legal action.
4. Condonable Period: An additional period of time, specified in a statute, during which a court or tribunal has the discretion to allow an action to be taken even after the prescribed period has expired.

Exhibits
NA