In Surendra G. Shankar & Anr. v. Esque Finamark Pvt. Ltd. & Ors. (2025 INSC 102), the Supreme Court of India held that when an appellate court considers an appeal solely on the issue of delay condonation, it cannot delve into the merits of the underlying dispute. The ruling ensures that procedural fairness is maintained by allowing tribunals to first adjudicate matters before higher courts engage with substantive legal issues.
Facts of the Case
The appellants, homebuyers in a registered real estate project, filed complaints before the Maharashtra Real Estate Regulatory Authority (RERA) seeking possession of flats. The complaints were dismissed on October 16, 2019, following an earlier order dated July 23, 2019, which had discharged one of the respondents from the proceedings.
The appellants subsequently filed appeals before the Maharashtra Real Estate Appellate Tribunal (Appellate Tribunal) on December 10, 2019. While these appeals were filed within the permissible timeframe for challenging the final order, they also sought to contest the earlier order of July 23, 2019, necessitating a delay condonation application.
The Appellate Tribunal dismissed the appeals on December 1, 2022, citing an absence of sufficient cause to condone the delay. The appellants then approached the Bombay High Court, which upheld the Tribunal’s decision and commented on the merits of the case. Dissatisfied, the appellants sought relief from the Supreme Court.
Key Legal Issues
- Whether the High Court erred in considering the merits of the dispute when the appeal was limited to delay condonation.
- Whether procedural fairness required condonation of delay in filing the appeal against the earlier order.
- Whether the Appellate Tribunal had correctly exercised its discretion in refusing delay condonation.
Arguments by the Parties
Appellants (Homebuyers):
- The delay in filing appeals against the July 23, 2019, order was inadvertent and should have been condoned in the interest of justice.
- The High Court overstepped its jurisdiction by commenting on the merits of the case when its scope was limited to reviewing the delay condonation ruling.
- The Tribunal failed to appreciate that the consent recorded in the July 23, 2019, order was disputed and should have been examined on merits.
Respondents (Esque Finamark Pvt. Ltd. & Others):
- The delay was unjustified, as the appellants were aware of the order in question.
- The High Court had the discretion to consider all aspects, including the merits of the case, in exercising its appellate jurisdiction.
- The July 23, 2019, order was passed with consent, and reopening the matter would be contrary to settled legal principles.
Supreme Court’s Reasoning
1. Scope of Appeal in Delay Condonation Cases
The Supreme Court emphasized that when an appellate court is only reviewing whether delay in filing an appeal should be condoned, it cannot go beyond that scope and examine the merits of the case. Citing Ram Kali Devi v. Punjab National Bank (1998) 9 SCC 558, the Court reiterated that:
- The appellate authority’s role is restricted to assessing whether sufficient cause exists for condonation.
- Once delay is condoned, the matter should return to the appropriate tribunal for adjudication on merits.
2. Procedural Fairness in Delay Condonation
The Court held that since the High Court acknowledged that delay should have been condoned under normal circumstances, it should have granted relief instead of making observations on the merits. The ruling aligns with State of Bihar v. Kameshwar Prasad Singh (2000) 9 SCC 94, which stresses that courts should lean in favor of condonation when delay is not deliberate.
3. High Court’s Overreach
The Supreme Court criticized the High Court for commenting on substantive issues when the Appellate Tribunal had not done so. It clarified that:
- Any discussion on the merits of the case must be left to the forum with original appellate jurisdiction.
- High Courts must not pre-empt lower tribunals by making observations that could prejudice subsequent adjudication.
Conclusion and Implications
The Supreme Court allowed the appeals, setting aside both the High Court’s ruling and the Appellate Tribunal’s refusal to condone the delay. It directed the Tribunal to hear the appeals on merits without being influenced by the prior orders.
This judgment reinforces the principle that appellate courts must strictly adhere to their scope of review. The ruling ensures that procedural limitations are respected, preventing courts from prematurely engaging with substantive legal disputes before the appropriate forum has ruled on them. It also underscores the judiciary’s commitment to fairness by emphasizing that delay condonation should be considered liberally in the absence of bad faith or deliberate inaction.
Stay informed with insights that matter. Follow us for more updates on key legal developments.
