NCLAT cannot condone Appeal Filing Delay beyond 45 Days: Supreme Court in Tata Steel Case [Read Order]

On May 7, the Supreme Court ruled that the National Company Law Appellate Tribunal (NCLAT), acting as the Adjudicating Authority under the Insolvency and Bankruptcy Code, 2016 (IBC), has no jurisdiction to condone delays in filing appeals beyond the statutory limit of 45 days (30 days plus a 15-day condonable period) prescribed under Section 61(2) of the Code.

A bench comprising Justices J.B. Pardiwala and R. Mahadevan set aside an earlier NCLAT order that had improperly allowed an appeal filed beyond this maximum time limit. The resolution plan in question was approved on April 7, 2022, triggering the initial 30-day limitation period, which ended on May 7, 2022—a working Saturday for the NCLAT. The additional 15-day condonable period thus expired on May 22, 2022. However, the Respondent filed the appeal via e-filing on May 23 and physically on May 24, exceeding the maximum permissible period.

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The Appellant challenged the NCLAT's decision before the Supreme Court, arguing that the appeal was clearly time-barred. In response, the Respondent claimed that the limitation began on April 8, 2022—the date the order was disclosed to the stock exchange—and that May 8, being a Sunday, extended the limitation under Section 4 of the Limitation Act. Thus, they argued that the final date for filing should be treated as May 24.

Rejecting this argument, the Supreme Court clarified that the limitation begins from the date of the order’s pronouncement, i.e., April 7, 2022. Since May 7 was a working day for the NCLAT Registry, the Respondent could not invoke Section 4 of the Limitation Act. The appeal, filed on May 24, was therefore beyond the statutory 45-day period and could not be condoned.

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The Court reiterated its stance from Kalpraj Dharamshi v. Kotak Investment Advisors Ltd. (2021), emphasizing that NCLAT has no authority to condone delays beyond 15 days after the initial 30-day period. The IBC’s appellate framework is deliberately stringent to ensure swift and certain resolution of insolvency cases.

“Even a delay of a single day is fatal if the statute does not provide for its condonation. Allowing such condonation would defeat legislative intent and compromise the efficiency of the IBC mechanism,” the Court stated. Accordingly, the appeal was allowed and the NCLAT order was set aside.

To Read the full text of the Order CLICK HERE

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