Harish Kumar vs Solitaire Infomedia Private Limited & ...

IN THE MATTER OF: Harish Kumar ...Appellant Versus Solitaire Infomedia Pvt. Ltd. & Anr. ...Respondents

Present:

For Appellant : Mr. Javed Khan, Advocate

For Respondent : Mr. Shikhil Suri, Ms. Wamika Chadha, Ms. Nidhi Kapoor, Advocates for R-2

ORDER

23.08.2023: This is an application praying for condonation of delay in

filing the appeal. The order was passed on 22.12.2022 by which an

application u/s 7 has been dismissed, as non-maintainable

2. This appeal has been e-filed on 01.03.2023. There is a delay of 38 days.

The application is filed for condonation of delay. Shri Javed Khan appearing

for Appellant submits that after the order dated 22.12.2022, restoration

application no. 24/2023 was filed which could be disposed of as withdrawn

on 13.02.2023 which application was filed on 18.01.2023. Hence, the period

from 18.01.2023 to 13.02.2023 be excluded by giving the benefit of Section

14 of Limitation Act.

Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

1

3. Learned Counsel for the Appellant has placed reliance on the judgement

of Hon'ble Supreme Court in Sesh Nath Singh & Anr. in Civil Appeal No.

9198 of 2019 Vs. Baidyabati Sheoraphuli Co-operative Bank Ltd. & Anr.

and the judgement of this Tribunal in IA no. 2315/2023 in Company

Appeal (AT) Insolvency No. 694 of 2023 in the matter of Vikram

Bhawanishankar Sharma, Member of the Suspended Board of Directors

of Supreme Vasai Bhiwandi Tollways Pvt. Ltd. Versus SREI Infrastructure

Finance Ltd. & Anr. The order on the basis of which the Appellant claims

exclusion of time u/s 14 dated 13.02.2023 is to the following effect:-

"Heard the submissions made

by Ld. Counsel for the Applicant. Ld.

Counsel for the Applicant has prayed for

grant of liberty to withdraw the present

application i.e. Rest.A/24/20223 and to

prefer an appeal against the order dated

22.12.2022. Prayer is granted and

application stands disposed of as

withdrawal."

4. The present is a case where we cannot hold that the application filed

for restoration was in a wrong forum which could not be decided for the defect

of jurisdiction or of like nature. Conditions as contemplated u/s 14 are not Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

2 attracted to extend the benefit u/s 14 to the Appellant. The judgement of

Hon'ble Supreme Court in Sesh Nath Singh & Anr. in Civil Appeal No. 9198

of 2019 Vs. Baidyabati Sheoraphuli Co-operative Bank Ltd. & Anr. was a case

where the benefit was extended u/s 14 of the Limitation Act with regard to

period during which writ petition was pending challenging the proceedings

under SARFAESI Act. Hon'ble Supreme Court in the said judgement has

taken the view that the benefit of the proceedings could have been extended

for the purpose. In paragraph 85 following has been observed: -

"85. In the instant case, the proceedings

under the SARFAESI Act may not have

formally been terminated. The

proceedings have however been stayed

by the High Court by an interim order, on

the prima facie satisfaction that the

proceedings initiated by the financial

creditor, which is a cooperative bank,

was without jurisdiction. The writ

petition filed by the Corporate Debtor

was not disposed of even after almost

four years. The carriage of proceedings

was with the Corporate Debtor. The

interim order was still in force, when

proceedings under Section 7 of the IBC

were initiated, as a result of which the Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

3 Financial Creditor was unable to proceed

further under SARFAESI Act."

5. It was held that since SARFAESI proceedings which were stayed by the

High Court which proceedings by the Cooperative Bank were without

jurisdiction due to which the Financial Creditor was unable to proceed further

under the SARFAESI Act. Para 86 and 87 following has been held:-

"86. In the instant case, even if it is assumed

that the right to sue accrued on 31.3.2013

when the account of Corporate Debtor was

declared NPA, the financial creditor initiated

proceedings under SARFAESI Act on 18th

January 2014, that is the date on which

notice under Section 13(2) was issued,

proceeded with the same, and even took

possession of the assets, until the entire

proceedings were stayed by the High Court

by its order dated 24th July 2017. The

proceedings under Section 7 of the IBC were

initiated on 10th July 2018.

87. In our view, since the proceedings in the

High Court were still pending on the date of

filing of the application under Section 7 of the

IBC in the NCLT, the entire period after the

Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

4 initiation of proceedings under the

SARFAESI Act could be excluded. If the

period from the date of institution of the

proceedings under the SARFAESI Act till the

date of filing of the application under Section

7 of the IBC in the NCLT is excluded, the

application in the NCLT is well within the

limitation of three years. Even if the period

between the date of the notice under Section

13(2) and date of the interim order of the

High Court staying the proceedings under

the SARFAESI Act, on the prima facie ground

of want of jurisdiction is excluded, the

proceedings under Section 7 of IBC are still

within limitation of three years."

6. The facts of the case Sesh Nath Singh & Anr. are entirely different and

are not attracted in the present case.

7. Coming to the judgement of this Tribunal in Vikram Bhawanishankar

Sharma which was a case where appeal was filed with delay in this Tribunal

and delay was caused due to the reason that after the order of the

Adjudicating Authority, the Appellant had filed a writ petition in Punjab and

Haryana High Court on the ground that there being the winter vacation of

the Appellate Tribunal, the Court is closed. The High Court passed an interim

Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

5 order and permitted the Appellant to withdraw the writ petition to file an

appeal. In the said circumstances this Tribunal held that the Appellant was

entitled for the benefit of Section 14 of the Limitation Act..

8. Learned Counsel for the Appellant has placed reliance on another

judgement of the Hon'ble Supreme Court in M/s Laxmi Srinivasa R and P

Boiled Ricel Mill Vs. The State of Andhra Pradesh & Anr. In the case

before the Supreme Court, the writ petition was filed in High Court and

thereafter proceedings were initiated and the appeal was filed before the

Appellate Tribunal for exclusion of the period. The Hon'ble Supreme Court

directed the Appellate Authority to examine the appeal on merits. The order

of the Supreme Court is as follows: -

"Order - Leave granted.

The impugned order passed

by the High Court affirming the order

dated 27.04.2018 passed by Appellate

Deputy Commissioner(CT)(FAC),

Vijayawada, holding that the delay is

beyond condonable period is

unsustainable in law.

It is an accepted position that the

appellant had filed a writ petition before

the High Court on 24.02.2018, which was

not entertained vide the order dated Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

6 07.03.2018 on the ground that the

appellant should approach the Appellate

Authority. The appellant is entitled to ask

for exclusion of the said period in terms of

Section 14 of the Limitation Act, 1963.

Exclusion of time is different, and cannot

be equated with condonation of delay.

The period once excluded, cannot be

counted for the purpose of computing the

period for which delay can be condoned.

Of course, for exclusion of time under

Section 14 of the Limitation Act, 1963, the

conditions stipulated in Section 14 have to

be satisfied.

In the facts of the present case, we find that

the period from the date of filing of the writ

petition on 24.02.2018 and the date on

which it was dismissed as not entertained

viz. 07.03.2018, should have been

excluded. The writ proceedings were

maintainable, but not entertained. Bona

fides of the appellant in filing the writ

petition are not challenged. Further,

immediately, after the dismissal of the writ Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

7 petition, the appellant did file an appeal

before the Appellate Authority. On

exclusion of the aforesaid period, the

appeal preferred by the appellant would

within the condonable period. Accordingly,

we direct that the application for

condonation of delay filed by the appellant

would treated as allowed. The delay is

directed to be condoned.

Recording the aforesaid, the appeal is

allowed with the direction that the

Appellant Authority would examine the

appeal on merits.

We clarify that have not expressed any

opinion on the merit of the case.

Pending application(s) if any, shall stand

disposed of."

9. The above case was again the case where benefit of section 14 was

allowed due to the proceedings of writ petition, which was held has not

maintainable. The facts of the said case are also entirely different. We, thus,

are of the view that Appellant is not entitled to the benefit of Section 14 of the

Limitation Act.

Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

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10. Our jurisdiction to condone the delay is limited to only 15 days. Hence,

we are unable to accept the prayer to condone the delay of 38 days beyond

the expiry of limitation. The application for condonation of delay is

rejected. Memo of appeal is rejected.

[Justice Ashok Bhushan] Chairperson

[Mr. Barun Mitra] Member (Technical)

ss/nn

Company Appeal (AT) (Insolvency) No. 348 of 2023 & I.A. No. 1174 of 2023

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