SC: Prescribed period under Limitation Act, does not include any period beyond period prescribed

The Hon’ble Supreme Court, on 18th September 2020, in the matter of Sagufa Ahmed & Ors. v. Upper Assam Plywood Products Pvt. Ltd. & Ors. pronounced that any period beyond the prescribed period, during which the Court or Tribunal has the discretion to allow a person to institute the proceedings, cannot be taken to be “prescribed period”.

The Hon’ble Supreme Court observed that:

The period of limitation of 45 days prescribed in Section 421(3) of Companies Act, 2013 would start running only from the date on which a copy of the order of the Tribunal is made available to the person aggrieved. (Para 10)

Rule 50 of the National Company Law Tribunal Rules, 2016 also mandates the Registry of the NCLT to send a certified copy of the final order to the parties concerned free of cost. However, Rule 50 also enables the Registry of the NCLT to make available the certified copies with cost as per schedule of fees in all other cases (meaning thereby ‘to persons who are not parties’).  (Para 11)

The period of limitation of 45 days prescribed in Section 421(3) of Companies Act, 2013 would start running only from the date on which a copy of the order of the Tribunal is made available to the person aggrieved. (Para 13)

If a party choses not to file a copy application, but to await the receipt of a free copy of the order in terms of Section 420(3) read with Rule 50, he would be perfectly justified in falling back on Section 421(3), for fixing the date from which limitation would start running. (This inference has been drawn on the basis of Para 14)

The law of limitation finds its root in two latin maxims, one of which is Vigilantibus Non Dormientibus Jura Subveniunt which means that the law will assist only those who are vigilant about their rights and not those who sleep over them. (Para 19)

The principle forming the basis of Section 10(1) of the General Clauses Act, also finds a place in Section 4 of the Limitation Act, 1963. (Para 21)

The words “prescribed period” appear in several Sections of the Limitation Act, 1963. Though these words “prescribed period” are not defined in Section 2 of the Limitation Act, 1963, the expression is used throughout, only to denote the period of limitation. (Para 22)

The expression “prescribed period” appearing in Section 4 of the Limitation Act, 1963 cannot be construed to mean anything other than the period of limitation. Any period beyond the prescribed period, during which the Court or Tribunal has the discretion to allow a person to institute the proceedings, cannot be taken to be “prescribed period”. (Para 23)

Copy of judgement: Judgement_18-Sep-2020

-Adv. Tushar Kaushik

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