The Supreme Court has held that the limitation period for filing an appeal under Section 62 of the Insolvency and Bankruptcy Code, 2016 (IBC) begins when the National Company Law Appellate Tribunal (NCLAT) pronounces its order. A litigant cannot postpone the commencement of limitation by delaying an application for a certified copy or relying on the date on which that copy is eventually received.
The Bench of Justice S.V.N. Bhatti and Justice N.V. Anjaria dismissed an appeal filed by the Assistant Commissioner of Central Tax against an NCLAT order affirming a corporate insolvency resolution plan. The Court found that, even after excluding the time required to obtain the certified copy, the appeal had been filed 16 days beyond the maximum condonable period.
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The dispute arose from the insolvency proceedings of Samyu Glass Private Limited, a manufacturer of glass containers registered as an Export Oriented Unit.
Between 2013 and 2017, the Central Excise and Service Tax Department initiated several excise recovery proceedings against the company. The company challenged the demands before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). It stopped manufacturing activities around November–December 2016.
Andhra Bank, now Union Bank of India, subsequently initiated insolvency proceedings under Section 7 of the IBC. Following admission of the application, a resolution professional was appointed.
When the Department convened a Joint Pricing Committee meeting on November 4, 2019, to determine the reserve price for auctioning attached machinery, the resolution professional informed it that the insolvency moratorium prohibited third-party authorities from disposing of the company’s assets.
On November 27, 2019, the Deputy Commissioner of Central Tax submitted a claim of ₹22,60,32,948.
The company, acting through the resolution professional, also approached the Revenue under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, presenting a proposal involving ₹4,32,80,741 for settlement of central excise arrears.
On August 13, 2021, the National Company Law Tribunal, Hyderabad, approved the resolution plan. Under that plan, ₹1,34,657 was provided towards the excise arrears payable to the Department.
The Department challenged the plan before the NCLAT, Chennai, which affirmed its approval on August 2, 2023. The Revenue then filed its appeal before the Supreme Court on November 21, 2023.
The preliminary dispute before the Supreme Court concerned whether the Revenue’s appeal was within limitation.
Respondent No. 2 argued that Section 62 permits an appeal within 45 days, with a further extension of no more than 15 days upon sufficient cause being shown. The appeal, it submitted, was outside this statutory framework even after allowing exclusion of the time spent obtaining the certified copy.
The Revenue relied on the expression “within forty-five days from the date of receipt of such order” in Section 62(1). It contended that limitation should begin on October 11, 2023, when it received the certified copy of the NCLAT order.
On that interpretation, the appeal filed on November 21, 2023, was within 41 days of receipt and therefore within the ordinary limitation period.
The Court rejected this argument.
The Bench held that the statutory reference to receipt of the order cannot be interpreted as allowing limitation to begin whenever a party chooses to apply for and collect a certified copy.
Such an interpretation would make the appeal period indefinite and dependent on the litigant’s own conduct. It would also undermine the purpose of Section 12(2) of the Limitation Act, which specifically permits exclusion of the time required to obtain a copy.
The Court explained that the IBC places an affirmative obligation on an intending appellant to act diligently and obtain the certified copy required for filing an appeal. A party cannot keep limitation suspended merely by awaiting a copy.
Referring to Rule 91 of the NCLAT Rules, 2016, the Bench noted that the date of pronouncement of a reserved order is notified in the cause list, which constitutes valid notice. Reading the operative portion in open court is deemed pronouncement.
Consequently, the Court held that limitation for an appeal under Section 62 commences when the NCLAT pronounces its order.
The judgment clarifies that Section 12(2) of the Limitation Act permits exclusion of the period genuinely required to obtain a certified copy—between applying for it and the copy being ready.
However, the period before a party applies for the copy cannot be excluded. The Explanation to Section 12 expressly prevents exclusion of the time taken to prepare an order before an application for its copy has been made.
The Bench therefore distinguished between time spent obtaining a copy after making an application and time lost through inaction before applying. Only the former qualifies for exclusion.
Applying these principles, the Court recorded that the NCLAT pronounced its judgment on August 2, 2023. The Revenue applied for a certified copy on September 6, 2023, by which time 35 days had already elapsed.
Those 35 days counted against the initial 45-day appeal period.
The Court excluded the 35-day period during which the certified-copy application remained pending, from September 6 to October 11, 2023.
When the copy was received on October 11, the Revenue had only 10 days remaining within the ordinary limitation period. According to the Court’s computation, that period expired on October 21, 2023. The additional discretionary period of 15 days expired on November 5, 2023.
The appeal was filed only on November 21, 2023.
Combining the 35 days before the application for a certified copy with the 41 days after its receipt, the Court calculated an effective period of 76 days. This exceeded the maximum statutory period of 60 days by 16 days.
The Bench reiterated that Section 62 provides an ordinary appeal period of 45 days and permits a further extension of up to 15 days on sufficient cause being established. Beyond that ceiling, the Court lacks jurisdiction to condone delay.
It relied on Sagufa Ahmed v. Upper Assam Plywood Products Private Limited, V. Nagarajan v. SKS Ispat and Power Limited, and CA Ramchandra Dallaram Choudhary v. Adani Infrastructure and Developers Private Limited to reaffirm the strict limitation framework governing insolvency appeals.
The Court also emphasised that the IBC is a self-contained code. Appellate provisions under the Companies Act cannot be used to relax its statutory timelines, and procedural rules cannot override the Code’s express limits.
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