Companies Act, 2013 — Ss. 58(3), 433 — Limitation Act, 1963 — S. 5 — Company Law Board (CLB)
Condonation of delay — Power of quasi-judicial body — Absence of statutory conferment — Held, CLB has no power to condone delay under S. 58(3) of the Companies Act, 2013 prior to enforcement of S. 433.
The Company Law Board, being a quasi-judicial authority and not a “court”, cannot apply Section 5 of the Limitation Act, 1963 in the absence of express statutory empowerment. During the interregnum period between 12-09-2013 and 01-06-2016, no provision analogous to Section 433 of the Companies Act, 2013 existed to confer such power on the CLB.
(Paras 33–41, 51–58, 90–93)
Limitation Act, 1963 — Applicability — Courts vs. Tribunals
Limitation Act applies only to courts unless expressly extended — Long-settled principle reaffirmed.
The Limitation Act, 1963 applies only to courts and not to tribunals or quasi-judicial bodies, unless the statute expressly provides otherwise. The CLB was vested with limited powers under Section 10E(4C) of the Companies Act, 1956, which did not include the power to condone delay.
(Paras 42–52, 56–58)
Limitation Act, 1963 — Ss. 5 & 14 — Distinction
Principles of S. 14 may apply to tribunals — Principles of S. 5 cannot — Conceptual and functional distinction explained.
While principles underlying Section 14 (exclusion of time) may be applied to quasi-judicial bodies to advance justice, Section 5 (extension of time) involves discretionary alteration of the limitation period and can be exercised only by courts or by tribunals expressly empowered by statute.
(Paras 59–65, 66–85)
Companies Act, 2013 — S. 433 — Prospective operation
Application of Limitation Act to NCLT/NCLAT — Not retrospective — Cannot validate earlier CLB orders.
Section 433 of the Companies Act, 2013, which applies the Limitation Act to proceedings before the NCLT and NCLAT, came into force only on 01-06-2016. It cannot be given retrospective effect so as to confer jurisdiction retrospectively upon the CLB to condone delay.
(Paras 36–41, 52, 90–93)
Inherent powers — CLB Regulations, 1991 — Reg. 44
Inherent power cannot override statutory limitation.
The inherent powers saved under Regulation 44 of the CLB Regulations cannot be invoked to defeat or circumvent a mandatory statutory limitation period. There is no inherent power to condone delay.
(Paras 99–102)
ANALYSIS (Issue-wise with Paragraph Mapping)
I. Statutory Interregnum and Forum Competence (Paras 33–41)
The Court undertakes a detailed examination of the phased enforcement of the Companies Act, 2013. Although Section 58 came into force on 12-09-2013, the adjudicatory forum continued to be the CLB until the constitution of the NCLT on 01-06-2016. Crucially, during this period, no statutory provision extended the Limitation Act to the CLB.
II. CLB Not a “Court” for Limitation Purposes (Paras 42–52)
Relying on a consistent line of authority (Athani Municipal Council, Kunhaliumma, Parson Tools, M.P. Steel), the Court reiterates that limitation provisions apply forum-wise. The CLB, being a tribunal with limited civil-court powers, does not qualify as a “court” for invoking Sections 4–24 of the Limitation Act.
III. Inapplicability of Section 5, Limitation Act (Paras 53–58)
Section 5 involves discretionary enlargement of limitation. Such discretion can only be exercised where expressly conferred. The Court holds that neither Section 10E of the 1956 Act nor Section 58 of the 2013 Act confers such power on the CLB.
IV. Critical Distinction Between Sections 5 and 14 (Paras 66–85)
This judgment provides a comprehensive doctrinal exposition:
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Section 5: Extension of limitation; discretionary; alters vested rights.
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Section 14: Exclusion of time; mandatory; restores litigant to a lawful position.
Only the latter’s principles may be applied by tribunals in the absence of express exclusion. This distinction is central to rejecting the respondent’s reliance on M.P. Steel.
V. Section 433 — No Retrospective Cure (Paras 90–93)
The High Court’s reasoning that Section 433 could be applied retrospectively is rejected. Jurisdictional competence must exist on the date of the original order. Subsequent legislative empowerment cannot validate an earlier act done without jurisdiction.
VI. Inherent Powers Misapplied (Paras 99–102)
The CLB’s reliance on Regulation 44 is held to be legally untenable. Inherent powers are procedural, not substantive, and cannot be exercised to override express or implied statutory bars.
RATIO DECIDENDI
A quasi-judicial body such as the Company Law Board has no power to condone delay under Section 58(3) of the Companies Act, 2013 in the absence of an express statutory provision applying Section 5 of the Limitation Act, 1963; the principles underlying Section 5 cannot be imported by analogy, inherent powers, or retrospective application of Section 433.
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