Supreme Court Rules Right To Appeal Under IBC Ends After Limitation Period Expires

New Delhi, Jun 10 (KNN) The Supreme Court has ruled that the right to file an appeal under Section 62 of the Insolvency and Bankruptcy Code (IBC), 2016 stands extinguished once the statutory limitation period and the prescribed time for curing defects in the appeal have expired.

Supreme Court Clarifies Appeal Limitation Under IBC

A bench comprising Justice Dipankar Datta and Justice Satish Chandra Sharma held that litigants cannot seek condonation of delay in re-filing an appeal beyond the period allowed under the Supreme Court Rules.

The Court observed that an appeal under Section 62 of the IBC must be filed within 45 days from receipt of the order of the National Company Law Appellate Tribunal (NCLAT). 

A further 15-day extension may be granted upon showing sufficient cause, taking the maximum permissible period to 60 days.

Defects Must Be Cured Within Prescribed Timeline

The bench clarified that if an appeal is filed with defects, those defects must be cured within 28 days of notification by the Supreme Court Registry. Failure to do so results in the appeal becoming non-maintainable.

The case arose from an appeal against an NCLAT order dated December 8, 2025. Although the appellant filed the appeal within the additional 15-day condonable period, the filing contained defects identified by the Registry.

The defects were subsequently cured after a delay of 82 days, accompanied by an application seeking condonation of the re-filing delay.

Court Rejects Plea For Delay Condonation

Rejecting the application, the Court held that once the statutory period under the IBC and the 28-day defect-curing window under the Supreme Court Rules have lapsed, the right to appeal ceases to exist and cannot be revived through condonation.

The bench also rejected the argument that filing a defective appeal within the limitation period should be treated as sufficient compliance with Section 62.

According to the Court, accepting such a position would allow litigants to bypass statutory timelines by filing incomplete appeals merely to preserve limitations and then rectifying defects at their convenience.

IBC Timelines Prevail Over Procedural Rules

The judgment further emphasised that the Supreme Court Rules, being subordinate legislation, cannot override the provisions of the IBC.

Referring to earlier rulings, including those in Mobilox Innovations Pvt. Ltd. v. Kirusa Software Pvt. Ltd., Kalparaj Dharamshi v. Kotak Investment Advisors Ltd. and V. Nagarajan v. SKS Ispat & Power Ltd., the Court reiterated that strict adherence to timelines remains a fundamental feature of the insolvency resolution framework.

Impact on MSMEs

The ruling reinforces the IBC’s strict timeline-based framework, providing greater certainty and faster resolution of insolvency cases for MSMEs. 

While it requires MSMEs to exercise greater diligence in filing appeals and curing defects within prescribed deadlines, it also helps prevent delays in insolvency proceedings, enabling quicker recovery and resolution outcomes for businesses and creditors.

(KNN Bureau)