The Insolvency and Bankruptcy Code, 2016
Part-II Insolvency Resolution and Liquidation for Corporate Persons
Chapter-VI Adjudicating Authority for Corporate Persons
Section 61: Appeals and Appellate Authority.
*61. (1) Notwithstanding anything to the contrary contained under the Companies Act 2013, any person aggrieved by the order of the Adjudicating Authority under this part may prefer an appeal to the National Company Law Appellate Tribunal.
(2) Every appeal under sub-section (1) shall be filed within thirty days1 before the National Company Law Appellate Tribunal:
Provided that the National Company Law Appellate Tribunal may allow an appeal to be filed after the expiry of the said period of thirty days if it is satisfied that there was sufficient cause for not filing the appeal but such period shall not exceed fifteen daysJ1.
(3) An appeal against an order approving a resolution plan under section 31 may be filed on the following grounds, namely:—
(i) the approved resolution plan is in contravention of the provisions of any law for the time being in force;
(ii) there has been material irregularity in exercise of the powers by the resolution professional during the corporate insolvency resolution period;
(iii) the debts owed to operational creditors of the corporate debtor have not been provided for in the resolution plan in the manner specified by the Board;
(iv) the insolvency resolution process costs have not been provided for repayment in priority to all other debts; or
(v) the resolution plan does not comply with any other criteria specified by the Board.
2[(4) An appeal against a liquidation order passed under section 33, or sub-section (4) of section 54L, or sub-section (4) of section 54N, may be filed on grounds of material irregularity or fraud committed in relation to such a liquidation order.
(5) An appeal against an order for initiation of corporate insolvency resolution process passed under sub-section (2) of section 54-O may be filed on grounds of material irregularity or fraud committed in relation to such an order.]
Reference
*Effective from 01.12.2016.
1. Limitation shall be computed from the date of e-filing – NCLAT Order dated 24.12.2022 read with order dated 21.02.2022.
2. Subs. by the Insolvency and Bankruptcy Code (Amendment) Act, 2021, w.e.f. 04.04.2021, for the sub-section:
“(4) An appeal against a liquidation order passed under section 33 may be filed on grounds of material irregularity or fraud committed in relation to such a liquidation order.”.
Judicial Pronouncements:
J1. An appeal can be filed to the Appellate Tribunal under Section 61 of the Act within 30 days of the order of the Adjudicating Authority with an extension of 15 further days and no more. [Mobilox Innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd. (2017) ibclaw.in 01 SC, p26]. Sagufa Ahmed & Ors. v. Upper Assam Plywood Products Pvt. Ltd. & Ors. (2020) ibclaw.in 28 SC.
J2. The statutory provisions provide that delay beyond 15 days in preferring the appeal u/s 61 of IBC is uncondonable, the same cannot be condoned even in exercise of powers under Article 142 of the Constitution. [National Spot Exchange Ltd. v. Mr. Anil Kohli (2021) ibclaw.in 151 SC]
J3. An appeal, if considered necessary and expedient by an aggrieved party, is expected to be filed forthwith without awaiting a free copy which may be received at an indefinite stage. The act of filing an application for a certified copy is not just a technical requirement for computation of limitation but also an indication of the diligence of the aggrieved party in pursuing the litigation in a timely fashion. In this case, owing to the specific language of Section 61(1) and 61(2), it is evident that limitation commenced once the order was pronounced and the time taken by the Court to provide the appellant with a certified copy would have been excluded, as clarified in Section 12(2) of the Limitation Act, if the appellant had applied for a certified copy within the prescribed period of limitation under Section 61(2) of the IBC. The litigant has to file its appeal within thirty days, which can be extended up to a period of fifteen days, and no more, upon showing sufficient cause. [V Nagarajan v. SKS Ispat and Power Ltd. & Ors. (2021) ibclaw.in 157 SC]
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