Supreme Court: Limitation for Filing NCLAT Appeal Begins from Date of Pronouncement in Open Court, Not from Date of Receipt or Knowledge

The Supreme Court held that the limitation period for filing an appeal before the NCLAT begins from the date of pronouncement of the order in open court, and not from the date of receipt or knowledge of the order.

On 04-04-2025, a three-judge Bench of the Supreme Court comprising Justice Abhay S. Oka, Justice Ahsanuddin Amanullah, and Justice Augustine George Masih reviewed a batch of two appeals and held that under Section 61(2) of the IBC, the limitation period for filing an appeal before the NCLAT begins from the date of pronouncement of the order, not from the date of receipt or knowledge of the order. The Court further clarified that the NCLAT cannot condone a delay beyond the statutorily prescribed outer limit of 45 days, even if sufficient cause is shown.

The Supreme Court, while dismissing the appeals, examined the correctness of the NCLAT’s decision dated 18.01.2024, wherein the applications seeking condonation of delay in filing the appeals were rejected, leading to the dismissal of the appeals themselves. The underlying appeals before the NCLAT challenged two orders of the NCLT dated 20.07.2023: one rejecting the appellant’s application under Section 60(5) read with Section 35(1)(n) of the IBC for placing his Resolution Plan before the Committee of Creditors and staying voting results; and the other allowing the Resolution Professional’s application under Section 30(6) and Section 31(1) of the IBC for approval of a Resolution Plan dated 10.01.2023. The appellant, a shareholder and suspended Managing Director of Dharti Dredging and Infrastructure Ltd., claimed that the appeals were within the limitation period but later filed applications for condonation of delay after objections were raised by the respondents.

The Court noted that the appeals were initially filed without applications for condonation of delay, though paragraph 6 of the appeal memorandum had asserted they were within limitation. Subsequent applications attempted to justify the delay—one citing the availability of a certified copy on 01.08.2023, and the other relying on the date of knowledge of the order through the RP on 07.08.2023. However, the appellant failed to produce any evidence of having applied for certified copies. Instead, contradictory stands were taken across different pleadings, leading the NCLAT to conclude that the appellant had misrepresented facts and failed to disclose the correct timeline, thereby dismissing the applications for condonation of delay.

The Supreme Court concurred with the NCLAT’s findings, emphasizing that the period of limitation under Section 61(2) of the IBC begins the day after the pronouncement of the order, and that the provision allows only a strict 30-day period with a maximum 15-day extension subject to the Tribunal’s satisfaction on sufficient cause being shown. The appellant had filed the appeals on 28.08.2023, well beyond the permissible window following the NCLT’s order dated 20.07.2023. The submission that the limitation should begin from the date of knowledge or receipt of the certified copy was rejected in light of the precedent in V. Nagarajan v. SKS Ispat and Power Limited and Others, REEDLAW 2021 SC 10518, where the Court had held that under the IBC, limitation commences from the date of pronouncement, not from the date of availability of the certified order.

Further, the Court reiterated that the IBC’s timeline framework is stringent and its provisions override the Companies Act or any liberal interpretation of limitation principles under the Limitation Act, unless expressly incorporated. Even the reliance on Section 12(3) of the Limitation Act or the plea that time was spent seeking legal advice was held insufficient to condone the delay. The Supreme Court found no reason to interfere with the NCLAT's well-reasoned conclusion, which found the appellant guilty of suppressing material facts and held that the appeals were rightly dismissed as barred by limitation.

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REEDLAW 2025 SC 04505