S.42 PLMA Excludes Applicability Of Section 5 Limitation Act, Delay In Filing Appeal Cannot Be Condoned Beyond 120 Days: Bombay High Court

The Bombay High Court has held that a delay in filing an appeal under Section 42 of the Prevention of Money Laundering Act, 2002 (PMLA) cannot be condoned by the High Court beyond 120 days as stipulated in the provision.A division bench of Justice B. P. Colabawalla and Justice Somasekhar Sundaresan stated that Section 42 PMLA excludes the applicability of Section 5 of the Limitation Act, 1963, which permits the court to condone delay if the applicant shows sufficient cause for not preferring the appeal or making the application within the stipulated period.“After perusing the provisions of Section 42, we are clearly of the view that when the said Section is read as a whole, the inescapable conclusion is that Section 5 of the Limitation Act, 1963 cannot be invoked for condoning the delay beyond the total period of 120 days as stipulated in Section 42 read with its proviso” the Court said.The Court was considering the Enforcement Directorate's (applicant) challenge to the PMLA Appellate Tribunal's order, wherein it allowed the appeal of Goa State Co-op Bank Ltd (respondent) and set-aside a Provisional Attachment Order. As there was a delay in filing the appeal, the applicant sought condonation of delay in filing the appeal. The applicant initially filed the appeal before the Gujarat High Court along with an application for condonation of delay of 5 days and the Court condoned the delay. However, during the appeal it was realised that the appeal would lie before the Bombay High Court and thus the applicant withdrew the case before Gujarat High Court. The applicant thus approached the Bombay High Court with a delay of 132 days. The applicant contended that Section 42 of PMLA does not preclude the applicability of Section 5 of the Limitation Act and thus the delay can be condoned by the Court. However, the Court did not accept this contention and remarked that if the legislature intended to make Section 5 Limitation Act applicable to an appeal filed under Section 42 PMLA, it would not have inserted the proviso to Section 42 which provides that the delay cannot be condoned for a further period of 60 days. The Court stated that the proviso to Section 42 PMLA with the wording 'within a further period not exceeding sixty days' indicates that Section 5 Limitation Act has been expressly excluded. “However, the proviso to Section 42 basically stipulates that the High Court shall, after the initial period of sixty days, have the power to condone the delay for a further period not exceeding sixty days. This would most definitely amount to an express exclusion to the applicability of Section 5 of the Limitation Act, 1963, to an appeal to be filed under Section 42 of the PMLA, 2002.”It referred to Municipal Corporation of Greater Mumbai vs. Anusaya Sitaram Devrukhkar & ors. (2025 LiveLaw (Bom) 13), where the Bombay High Court observed that as proviso to Section 74(1) of the Land Acquisition Act specifically states that High Court cannot condone delay for a further period of exceeding 60 days, after the initial period of 60 days, this amounts to express exclusion of the applicability of the Limitation Act, 1963.Noting that Section 42 PMLA is identical to Section 74(1) of the Land Acquisition Act, the Court stated, “We are clearly of the view that the decision rendered by this Court in Municipal Corporation of Greater Mumbai (supra) would apply with full force to the facts of the present case. We, therefore, have no hesitation in holding that after the total period of 120 days as stipulated in Section 42 of the PMLA, 2002, read with its proviso, the High Court would have no power to condone the delay in preferring the Appeal.”The Court thus held that Section 5 Limitation Act cannot be invoked to condone the delay beyond a period of 120 days as mandated in Section 42 PMLA.In the present case, it noted that the fact that the applicant approached the wrong forum would not reset the period for calculating limitation. It stated, “That the Appellant was found to have approached the wrong forum would not reset the clock for computing limitation from scratch. The Appellant ought to have approached this Court within 55 days of the outcome at the Gujarat High Court, and evidently, the Appellant was late by a long distance of time.”The Court thus dismissed the ED's application seeking condonation of delay. Case title: The Assistant Director, Directorate of Enforcement vs. The Branch Manager, The Goa State Co-op Bank Ltd. (Interim Application No. 1958 Of 2024 In First Appeal (St.) No. 3056 Of 2024)Citation: 2025 LiveLaw (Bom) 22Click Here To Read/Download Order

S.42 PLMA Excludes Applicability Of Section 5 Limitation Act, Delay In Filing Appeal Cannot Be Condoned Beyond 120 Days: Bombay High Court

Sanjana Dadmi

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