Property Company (P) Ltd. Vs Rohinten Daddy Mazda (Supreme Court of India)
CLB Has No Power to Condon Delay Under Section 58(3) of the Companies Act, 2013 Prior to Section 433 Coming into Force
The Supreme Court examined whether the Company Law Board (CLB) had the authority to condone delay in filing an appeal under Section 58(3) of the Companies Act, 2013 during the transitional phase when the 2013 Act had come into force but the NCLT/NCLAT were not yet constituted. The appeal in question was filed with a delay of 249 days, which the CLB condoned by invoking its inherent powers and by applying the principles of the Limitation Act, 1963.
The Court categorically held that the Limitation Act applies only to “courts” and not to quasi-judicial bodies or tribunals, unless the governing statute expressly extends such power. The CLB, constituted under the Companies Act, 1956, was not a court and was vested only with limited procedural powers under Section 10E(4C) of the 1956 Act. There was no statutory provision, prior to 01.06.2016, empowering the CLB to apply either Section 5 of the Limitation Act or its underlying principles.
The Court further clarified that Section 433 of the Companies Act, 2013, which makes the Limitation Act applicable to proceedings before the NCLT and NCLAT, was consciously brought into force only from 01.06.2016 and cannot be applied retrospectively to proceedings before the CLB. The legislative intent was clear: limitation powers were to vest only in the new tribunal framework, not in the CLB.
Importantly, the Court rejected the argument that Section 58(3) appeals could be treated flexibly merely because the provision does not use restrictive language like “but not thereafter”. In the absence of an express power of condonation, statutory limitation periods are mandatory. The Court also reaffirmed that even the principles underlying the Limitation Act (as distinct from its text) cannot be imported into quasi-judicial proceedings unless the statute permits it.
Accordingly, the Supreme Court held that the CLB acted without jurisdiction in condoning the delay, set aside the orders of the CLB and the High Court, and reaffirmed the strict separation between courts and tribunals in matters of limitation law.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. Leave granted.
