No Provision Under Liquidation Process Regulations Permitting Acceptance Of Belated Claims: NCLT Allahabad

The NCLT, Allahabad Bench, comprising Praveen Gupta (Member-Judicial) and Ashish Verma (Member-Technical), has observed that unlike CIRP proceedings, there is no enabling provision under the liquidation process regulations permitting acceptance of belated claims. The liquidator rejected the claim filed by the applicant. Therefore, the appellant filed the present appeal challenging the rejection, under section 5 of the Limitation Act, 1963, read with Rule 11 of the NCLT Rules, 2016, seeking condonation of delay of 45 days in filing the application. The applicant submitted that the delay in filing was due to administrative procedures and inadvertent errors, such as delayed notarization and internal approval. The tribunal considered the issue of whether it has the power to condone the delay of 45 days in filing the application challenging the rejection of the appellant's claim. Observations of the NCLT The tribunal observed that the applicant filed its claim before the liquidator, with a delay of 134 days, which is beyond the statutory limit prescribed under section 38(1) of the IBC read with regulation 12(2) of the IBBI (Liquidation Process) Regulations, 2016. The tribunal considered the appellants' reliance on the Hon'ble Supreme Court's ruling in the case of In Re: Cognizance for Extension of Limitation, Suo Motu Writ Petition (Civil) No. 3 of 2020, and discussed the delay of 90 days that was condoned by the apex court; however, in the present case, even if the delay of 90 days is allowed, then also the application is 45 days beyond the extended period. The bench further referred to the judgment of UCO Bank v. Nicco Corporation Ltd. (In Liquidation) [CA 31/KB/2018] to observe that, unlike CIRP proceedings, there is no enabling provision under the Liquidation Process Regulations permitting acceptance of belated claims. Furthermore, the tribunal discussed the ruling of the Hon'ble Supreme Court in State of West Bengal v. Howrah Municipality (AIR 1972 SC 749) to observe that the applicant's plea with regard to administrative delays, or notarial deficiencies, doesn't constitute “sufficient cause.” Lastly, the bench observed that the appellant has failed in exercising due diligence, as the IA seeking condonation of delay was filed two months later after the filing of the application, and not simultaneously. Accordingly, the bench dismissed the application, observing that the delay beyond 45 days could not be condoned. Case Name: Electric Distribution Division-I v. Mrs. Anju Agarwal Case No.: IA No. 229/2022 & IA No.273/2022 IN CP (IB) No.110/ALD/2017 Bench: Praveen Gupta (Member-Judicial) and Ashish Verma (Member-Technical) Order Date: 08.09.2025Click Here To Read/Download The Order

No Provision Under Liquidation Process Regulations Permitting Acceptance Of Belated Claims: NCLT Allahabad

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No Provision Under Liquidation Process Regulations Permitting Acceptance Of Belated Claims: NCLT Allahabad

Mohd.Rehan Ali

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Mohd.Rehan Ali

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