Introduction
In State Bank of India v. India Power Corporation Ltd. (Civil Appeal No. 10424 of 2024), the Supreme Court of India resolved a significant procedural conundrum concerning the treatment of “free” certified copies issued under Rule 50 of the National Company Law Tribunal Rules, 2016 (NCLT Rules) for the purpose of computing limitation under Section 61(2) of the Insolvency and Bankruptcy Code, 2016 (IBC). The ruling effectively harmonizes the application of Rule 50 of the NCLT Rules with Rule 22(2) of the National Company Law Appellate Tribunal Rules, 2016 (NCLAT Rules), ensuring procedural clarity and fairness.
1. Factual Background and Procedural History
The appellant, State Bank of India (SBI), had filed a petition under Section 7 of the IBC before the NCLT, Hyderabad, against the respondent, India Power Corporation Ltd. The NCLT rejected the petition for maintainability on 30 October 2023.
SBI filed an appeal before the NCLAT on 2 December 2023, beyond the 30-day limit prescribed under Section 61(2) of the IBC. However, it was only delayed by three days, and an application for condonation of delay was submitted.
A split decision emerged in the NCLAT:
- The Judicial Member dismissed the application, holding that a free certified copy cannot substitute for a certified copy obtained upon request.
- The Technical Member disagreed, recognizing no distinction between free and fee-based certified copies.
A third member ultimately sided with the Judicial Member, leading to dismissal of the appeal on limitation grounds.
2. Identification of Legal Issues
The Supreme Court was called upon to determine:
- Whether a free certified copy issued under Rule 50 of the NCLT Rules qualifies as a valid “certified copy” for purposes of filing an appeal under Rule 22(2) of the NCLAT Rules.
- Whether a delay of three days in filing an appeal—within the condonable 15-day window under the proviso to Section 61(2) of the IBC—can be condoned where a party relies on the date of receipt of a free certified copy.
- Whether the ruling in V. Nagarajan v. SKS Ispat and Power Ltd., (2022) 2 SCC 244, bars reliance on free certified copies for computing limitation.
3. Arguments of the Parties
Appellant (SBI):
- Argued that Rule 50 of the NCLT Rules equates certified copies received free of cost with those obtained on payment.
- Asserted that the free copy of the NCLT’s order was received on 14 November 2023, and the appeal filed on 2 December 2023 fell within the 15-day condonable window.
- Cited the absence of any statutory distinction between free and paid certified copies.
Respondent (India Power Corporation Ltd.):
- Relying on V. Nagarajan, argued that litigants are obligated to apply for a certified copy to compute limitation.
- Contended that waiting for a free copy instead of applying for a certified one cannot be a ground for condoning delay.
4. Court’s Analysis and Reasoning
a. Rule 50 and Rule 22: Harmonization
The Court interpreted Rules 50 (NCLT Rules) and 22 (NCLAT Rules) harmoniously. It noted:
- Rule 50 requires the Registry to provide a certified copy of a final order to the parties free of cost.
- Rule 22(2) mandates a “certified copy” be filed with the appeal but does not specify that it must be a paid copy.
The Court rejected the notion that only certified copies obtained upon application are valid. It held that both free and paid certified copies are legally valid and indistinguishable for purposes of limitation.
b. V. Nagarajan Distinguished
The Court clarified that V. Nagarajan was distinguishable. In V. Nagarajan, the appellant had neither applied for a certified copy nor filed the appeal in time and attempted to rely solely on the free copy—without proof of when it was issued. That was a case of litigants seeking to “take two bites at the apple.”
In contrast, SBI had received the free certified copy on 14 November 2023 and filed the appeal within the 45-day outer limit set by Section 61(2) of the IBC.
c. Delay Justified and Condonable
The Court ruled that:
- The delay of three days was within the permissible 15-day extension under Section 61(2).
- There was “sufficient cause” for the delay.
- The appeal should have been entertained on merits.
5. Final Conclusion and Holding
The Supreme Court allowed the appeal, set aside the NCLAT’s order dated 9 July 2024, and restored SBI’s appeal to the NCLAT’s file. It held that:
“The provisions of Rule 50 of the NCLT Rules place both the free certified copy as well as the certified copy which is applied for on payment of fees on the same footing.”
This judgment underscores that judicial efficiency must be balanced with fairness in procedural compliance, especially when delays are marginal and justifiable.
FAQs:
1. Can a free certified copy from NCLT be used to file an appeal before NCLAT?
Yes. The Supreme Court clarified that a certified copy received free of cost under Rule 50 of the NCLT Rules is legally valid for filing an appeal under Rule 22(2) of the NCLAT Rules.
2. What is the time limit for filing an appeal under Section 61(2) of the IBC?
An appeal must be filed within 30 days from the date of the NCLT order, with a possible extension of up to 15 additional days if sufficient cause is shown.
3. Is there a difference between free and paid certified copies under NCLT Rules?
No. Rule 50 treats both types of certified copies equally. Whether obtained free of cost or through a fee, both are valid for appeal purposes.
4. Does V. Nagarajan v. SKS Ispat prevent reliance on free copies for appeal limitation?
Not necessarily. The Supreme Court distinguished V. Nagarajan, holding that litigants may rely on free certified copies—provided they were actually received and relied upon in a timely and bona fide manner.
5. Can a minor delay in filing an NCLAT appeal be condoned?
Yes. A delay of up to 15 days beyond the 30-day period can be condoned by the NCLAT if sufficient cause is shown, as affirmed in this judgment.
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