A) ABSTRACT / HEADNOTE

The Supreme Court in Sagufta Ahmed & Ors. v. Upper Assam Plywood Products Pvt. Ltd. & Ors. examined the statutory contours of limitation under Section 421(3) of the Companies Act, 2013 and clarified the legal distinction between “period of limitation” and “period up to which delay may be condoned”. The appellants challenged the order of the National Company Law Appellate Tribunal dismissing their appeal as time-barred and refusing condonation of delay beyond the statutorily permissible period. The central issue concerned whether the benefit of the Supreme Court’s suo motu order dated 23.03.2020, extending limitation due to the COVID-19 pandemic, could enlarge the maximum condonable period prescribed under a special statute.

The Court held that while the statutory limitation period may stand extended by judicial orders passed under Articles 141 and 142 of the Constitution, such extension does not apply to discretionary periods for condonation which are expressly capped by statute. The judgment reaffirms legislative supremacy in prescribing outer limits for appellate remedies and underscores that equitable considerations cannot override clear statutory mandates. Relying upon Assam Urban Water Supply and Sewerage Board v. Subash Projects and Marketing Ltd., the Court clarified the scope of Section 4 of the Limitation Act, 1963, holding that “prescribed period” refers only to the limitation period and not the condonable grace period.

The decision reinforces procedural discipline in corporate litigation and reiterates the maxim Vigilantibus Non Dormientibus Jura Subveniunt, emphasizing that judicial indulgence is unavailable to litigants who remain inactive despite statutory clarity.

Keywords: Limitation, Condonation of Delay, Companies Act, COVID-19 Extension, NCLAT Jurisdiction

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The judgment arose from a procedural challenge within the corporate adjudicatory framework established under the Companies Act, 2013. The appellants, minority shareholders holding 24.89% equity in the respondent company, initiated winding-up proceedings before the National Company Law Tribunal, Guwahati Bench. The dismissal of that petition led to an appellate remedy under Section 421, which prescribes a rigid limitation regime with narrowly defined discretion.

The case is situated at the intersection of statutory limitation and extraordinary judicial intervention during the COVID-19 pandemic. The appellants attempted to rely on the Supreme Court’s suo motu extension of limitation to overcome delay that had already exceeded the maximum condonable window even before the lockdown commenced. The Court was thus called upon to determine whether pandemic-related extensions could override express statutory bars under special legislation.

The judgment gains importance as it clarifies procedural compliance in company law appeals and delineates the limits of judicial discretion when statutory timelines are peremptory. It also serves as a caution against misconstruing benevolent judicial orders as blanket relaxations of all procedural constraints.

D) FACTS OF THE CASE

The appellants, shareholders of Upper Assam Plywood Products Pvt. Ltd., filed a winding-up petition before the NCLT, Guwahati Bench. The Tribunal dismissed the petition by an order dated 25.10.2019, pronounced in the presence of the parties. Although entitled to a free certified copy under Section 420(3) read with Rule 50 of the NCLT Rules, 2016, the appellants chose to apply for a certified copy on 21.11.2019, approximately 27 days later.

The certified copy was received by their counsel on 19.12.2019. Under Section 421(3), the appellants had 45 days from that date to file an appeal before the NCLAT, which expired on 02.02.2020. The proviso to the section permits condonation of delay for a further period not exceeding 45 days, expiring on 18.03.2020. Despite this, the appeal was filed only on 20.07.2020.

The appellants sought condonation by invoking the Supreme Court’s suo motu order dated 23.03.2020 extending limitation due to COVID-19. The NCLAT dismissed the application, holding that it lacked jurisdiction to condone delay beyond the statutory maximum. This dismissal was challenged before the Supreme Court.

E) LEGAL ISSUES RAISED

i. Whether the limitation period under Section 421(3) commenced from the date of pronouncement or from the date of receipt of the certified copy?
ii. Whether the Supreme Court’s suo motu order extending limitation due to COVID-19 could extend the statutorily capped condonable period?
iii. Whether Section 4 of the Limitation Act, 1963 applies to discretionary periods of condonation?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for the appellants submitted that limitation under Section 421(3) begins only when a copy of the order is made available. They argued that the delay should be computed excluding the period affected by COVID-19 lockdown, relying upon the Supreme Court’s order dated 23.03.2020. It was contended that the phrase “whether condonable or not” in the said order implied extension even of condonable periods.

G) RESPONDENT’S ARGUMENTS

The counsels for the respondents contended that the statutory framework permits no condonation beyond 45 days. They argued that the appellants were negligent well before the lockdown and that the suo motu order did not override statutory caps under special laws. The respondents emphasized legislative intent and jurisdictional limitations of the NCLAT.

H) RELATED LEGAL PROVISIONS

i. Section 420(3), Companies Act, 2013
ii. Section 421(3), Companies Act, 2013
iii. Section 4, Limitation Act, 1963
iv. Section 10, General Clauses Act, 1897
v. Articles 141 and 142, Constitution of India

I) JUDGEMENT

The Supreme Court dismissed the appeals, affirming the NCLAT’s order. The Court held that limitation commenced from 19.12.2019, the date on which the certified copy was received. It observed that the appellants failed to act within both the limitation period and the maximum condonable period.

The Court categorically held that the suo motu order dated 23.03.2020 extended only the period of limitation and not the discretionary condonable period. The Court clarified that judicial orders cannot enlarge jurisdiction where a statute explicitly restricts it. The lockdown commenced only on 24.03.2020, by which time even the condonable period had expired.

a) RATIO DECIDENDI

The expression “prescribed period” under Section 4 of the Limitation Act, 1963 refers only to the statutory limitation period and does not include any additional discretionary period provided for condonation. The Supreme Court’s suo motu extension of limitation does not override express statutory caps on condonation under special enactments such as the Companies Act, 2013. Reliance was placed on Assam Urban Water Supply and Sewerage Board v. Subash Projects and Marketing Ltd., [2012] 1 SCR 403 .

b) OBITER DICTA

The Court emphasized the maxim Vigilantibus Non Dormientibus Jura Subveniunt, reiterating that law aids only vigilant litigants. The Court observed that pandemic-related extensions were intended to protect diligent parties prevented by circumstances, not those already in default.

c) GUIDELINES

i. Statutory outer limits for condonation cannot be judicially extended.
ii. Pandemic-related extensions apply only to limitation periods, not condonable grace periods.
iii. Litigants must act with diligence even where procedural benefits exist.
iv. Special statutes prevail over general equitable considerations.

J) REFERENCES

a) Important Cases Referred

i. Assam Urban Water Supply and Sewerage Board v. Subash Projects and Marketing Ltd., [2012] 1 SCR 403

b) Important Statutes Referred

i. Companies Act, 2013
ii. Limitation Act, 1963
iii. General Clauses Act, 1897
iv. Constitution of India