The Supreme Court has decisively clarified that an appeal under the Insolvency and Bankruptcy Code, 2016, is not merely defective but fundamentally incompetent if filed without a certified copy of the impugned order. This ruling reinforces the non-negotiable nature of procedural compliance in insolvency proceedings, where timelines are of the essence.
Background & Facts
The Dispute
The dispute arose from the approval of a resolution plan by the National Company Law Tribunal, Kochi Bench (NCLT), in CP(IB)/05/KOB/2021 on 14.08.2024. The plan was submitted by the appellant, Angelwoods Apartment Allottees Association, and approved by the NCLT. Respondent No. 1, M. Lalitha, a financial creditor and mother of a suspended director of the corporate debtor, Samson and Sons Builders and Developers Pvt. Ltd., challenged this approval by filing an appeal before the National Company Law Appellate Tribunal, Chennai (NCLAT).
Key Facts
- The NCLT’s order dated 14.08.2024 was the subject of appeal.
- The limitation period for filing an appeal under Section 61(2) of the IBC was 30 days, expiring on 13.09.2024.
- The proviso to Section 61(2) allowed a further 15 days for condonable delay, extending the outer limit to 28.09.2024.
- Respondent No. 1 e-filed the appeal on 28.09.2024, the last permissible day.
- On 04.10.2024, the NCLAT Registry notified 10 defects in the appeal, including absence of a certified copy of the impugned order.
- Respondent No. 1 filed IA No. 1165 of 2025 on 10.03.2025 seeking condonation of 150 days’ delay in refiling the appeal after curing defects.
- The certified copy of the NCLT’s order was applied for only on 21.04.2025, prepared on 24.04.2025, and collected on 12.06.2025.
- At the time of refiling on 10.03.2025, the appeal still lacked the certified copy.
- No application for exemption under Rules 14 or 15 of the NCLAT Rules was ever filed.
Procedural History
- 14.08.2024: NCLT approves resolution plan submitted by Angelwoods Apartment Allottees Association.
- 13.09.2024: Statutory 30-day limitation period for appeal expires.
- 28.09.2024: Respondent No. 1 e-files appeal before NCLAT (within 45-day outer limit).
- 04.10.2024: NCLAT Registry issues Scrutiny Report listing 10 defects, including absence of certified copy.
- 10.03.2025: Appeal refiled without certified copy of impugned order.
- 21.04.2025: Respondent No. 1 applies for certified copy of NCLT order.
- 24.04.2025: Certified copy prepared by NCLT.
- 12.06.2025: Certified copy collected by respondent.
- 10.11.2025: NCLAT condones delay of 15 days in filing and 150 days in refiling, allowing appeal to proceed.
- 12.05.2026: Supreme Court hears appeal and sets aside NCLAT’s order.
Relief Sought
The appellant sought setting aside of the NCLAT’s order dated 10.11.2025, which had allowed the appeal despite the absence of a certified copy of the impugned order. The appellant argued that the appeal was legally incompetent from inception and should have been rejected at the threshold.
The Legal Issue
The central question was whether an appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016, is legally maintainable when filed and refiled without a certified copy of the impugned order, even if delay is condoned, and whether the NCLAT erred in overlooking this fundamental defect.
Arguments Presented
For the Appellant
The appellant contended that Rule 22(2) of the NCLAT Rules mandates that every appeal must be accompanied by a certified copy of the impugned order. Failure to comply renders the appeal incompetent, not merely defective. Reliance was placed on V. Nagarajan v. SKS Ispat and Power Limited to argue that applying for a certified copy before limitation expires is not a technicality but a demonstration of diligence. The appellant emphasized that the Supreme Court in Ebix Singapore v. Committee of Creditors has held that IBC timelines are sacrosanct. The absence of any application for exemption under Rules 14 or 15 further negated any possibility of cure.
For the Respondent
Respondent No. 1 argued that the delay in filing and refiling was condoned by the NCLAT, and minor procedural lapses should not defeat substantive rights. She contended that the certified copy was eventually obtained and that the NCLAT’s discretion to condone delay under Rule 14 should prevail. She also argued that the defects were curable and that the appeal had been heard on merits.
The Court's Analysis
The Supreme Court undertook a rigorous analysis of the statutory and procedural framework under the IBC and the NCLAT Rules. It emphasized that Rule 22(2) of the NCLAT Rules is not a mere formality but a substantive requirement. The Court observed:
"The act of filing an application for a certified copy is not just a technical requirement for computation of limitation but an indication of the diligence of the party in pursuing the litigation in a timely fashion."
The Court distinguished between curable defects and fundamental incompetence. While some procedural lapses may be cured, the absence of a certified copy at the time of filing or refiling, without any application for exemption, renders the appeal legally non-existent. The Court noted that respondent No. 1 did not apply for the certified copy until 21.04.2025 - seven months after the appeal was filed and over a month after it was refiled. This demonstrated a complete lack of diligence.
The Court further held that the NCLAT’s reliance on its discretion to condone delay was misplaced. The power to condone delay under Rule 14 cannot override the mandatory requirement of Rule 22(2). The NCLAT failed to determine whether the appeal met the threshold requirements for maintainability before entertaining the condonation applications.
The Court also referenced Ebix Singapore v. Committee of Creditors to underscore that the IBC is a time-bound regime, and procedural laxity undermines its very purpose. The Court concluded that the appeal was not merely defective - it was incurably tainted and could not be revived by condonation of delay.
The Verdict
The Supreme Court allowed the appeal and set aside the NCLAT’s order dated 10.11.2025. The Court held that the appeal filed by respondent No. 1 was legally incompetent due to the absence of a certified copy of the impugned order at the time of filing and refiling. The NCLAT’s condonation of delay was held to be legally unsustainable. Parties were directed to bear their own costs.
What This Means For Similar Cases
Procedural Compliance Is Non-Negotiable
- Practitioners must apply for certified copies of impugned orders before the limitation period expires to claim exclusion of time under V. Nagarajan.
- Delay condonation cannot cure a non-existent appeal; the foundational requirement of a certified copy is mandatory.
- Any appeal filed without a certified copy, even if later produced, is liable to be rejected at the threshold.
No Automatic Waiver Under Rule 14
- Applications for exemption under Rules 14 or 15 must be filed contemporaneously with the appeal or refiling.
- Post-filing applications for exemption are insufficient if the appeal was never properly instituted.
- Courts will not presume waiver; explicit application is required.
IBC Timelines Are Absolute
- The IBC’s time-bound nature requires strict adherence to procedural norms.
- Litigants cannot rely on appellate leniency to compensate for initial procedural negligence.
- NCLATs and NCLTs must conduct a preliminary review to determine if an appeal is legally complete before entertaining delay applications.
