The Supreme Court clarified the certified copy requirement for appeals under the IBC, ruling that a free copy is not sufficient to extend the limitation period.
The Supreme Court Bench of Dr Dhananjaya Y. Chandrachud, CJI. and Justice Manoj Misra reviewed an appeal and observed that a free certified copy provided under Rule 50 of the NCLT Rules cannot substitute the certified copy required under Rule 22(2) of the NCLAT Rules for filing an appeal, and parties must apply for a certified copy to comply with the statutory limitation period under Section 61(2) of the IBC.
In the Supreme Court order, a divergence arose between two members of the National Company Law Appellate Tribunal (NCLAT) on May 1, 2024, concerning an application for condonation of delay. The third member of the Tribunal, on July 9, 2024, aligned with the Judicial Member and dismissed the application for condonation of a three-day delay. The case involved an appeal by the State Bank of India (SBI), which filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) 2016 against the respondent. The National Company Law Tribunal (NCLT) in Hyderabad rejected the petition on October 30, 2023, based on maintainability.
SBI filed an appeal before the NCLAT on December 2, 2023, accompanied by an application for condonation of a three-day delay beyond the 30-day limit under Section 61(2) of the IBC. The Judicial Member of NCLAT ruled that the certified copy submitted by the appellant was a "free of cost" copy, and in the absence of an application for a certified copy, the delay could not be condoned. In contrast, the Technical Member opined that there should be no distinction between certified copies obtained for free and those obtained for a fee, and thus, the delay should be condoned.
The third member ruled that a free copy provided under Rule 50 of the NCLT Rules, 2016, could not be treated as a certified copy as per Rule 22(2) of the NCLAT Rules, 2016. The appeal was dismissed on July 9, 2024, on grounds of delay. The Court observed that the appeal process under Section 61(2) of the IBC requires a certified copy and Rule 50 of the NCLT Rules governs the provision of such copies, including those provided free of cost. Despite arguments made by the appellant’s counsel, the appeal was not allowed due to non-compliance with procedural requirements for obtaining a certified copy within the stipulated time.
The Supreme Court’s ruling hinged on the interpretation of Rule 50 of the NCLT Rules and Rule 22 of the NCLAT Rules, highlighting the distinction between free and paid certified copies and their role in the appellate process under the IBC. Ultimately, the Court upheld the Tribunal’s decision to dismiss the appeal on procedural grounds, reinforcing the importance of adhering to the statutory time limits for filing appeals.
Mr. Tushar Mehta, SG, Mr. Madhav Kanoria, Ms. Surabhi Khattar, Ms. Neha Shivhare, Mr. Sriharsh Raj, Advocates, M/S. Cyril Amarchand Mangaldas, AOR represented for Appellant.
Dr. Abhishek Manu Singhvi, Senior Advocate, Mr. Anirban Bhattacharya, AOR, Mr. Rajeev Chowdhary, Ms. Priyanka Bhatt, Mr. Pranjit Bhattacharya, Advocates appeared for the Respondent
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