Metalrod Private Limited v. Registrar National Company Law Tribunal, New Delhi & Anr.

1. The present writ petition has been received by way of marking/transfer.

2. The present petition has been filed by the petitioner seeking directions against respondent no. 2 for their failure to comply with Rule 28 of the National Company Law Tribunal Rules, 2016 (“Rules 2016”), which deals with the issue of re-filing of petitions/applications. The said Rule reads as under:

initials on the stamp affixed on the first page of the copies and enter the particulars of all such documents in the register after daily filing and assign a diary number which shall be entered below the date stamp and thereafter cause it to be sent for scrutiny. (2) If, on scrutiny, the appeal or petition or application or document is found to be defective, such document shall, after notice to the party, be returned for compliance and if there is a failure to comply within seven days from the date of return, the same shall be placed before the (3) The Registrar may for sufficient cause return the said document for rectification or amendment to the party filing the same, and for this purpose may allow to the party concerned such reasonable time as he may consider necessary or extend the time for compliance. (4) Where the party fails to take any step for the removal of the defect within the time fixed for the same, the Registrar may, for reasons to be recorded in writing, decline to register the pleading or document.”

3. It is the case of the petitioner that as per Rule 28(2), any defect was required to be removed within a period of seven days. However, in the present case, the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) was filed way back on 21st January, 2022, and has undergone re-filing process nine times, despite the fact that the said defects had to be removed within a statutory period of seven days only.

4. Learned Senior Counsel appearing for the petitioner relies upon the judgment of the Supreme Court in the case of Surendra Trading Company Versus Juggilal Kamlapat Jute Mills Company Limited and Others, (2017) 16 SCC 143, and relies upon the following paragraph: “xxx xxx xxx 26 [Ed.: Para 26 corrected vide Official Corrigendum No. F.3/Ed.B.J./120/2017 dated 9-3-2018.]. We are also conscious of the fact that sometimes applicants or their counsel may show laxity by not removing the objections within the time given and may take it for granted that they would be given unlimited time for such a purpose. There may also be cases where such applications are frivolous in nature which would be filed for some oblique motives and the applicants may want those applications to remain pending and, therefore, would not remove the defects. In order to take care of such cases, a balanced approach is needed. Thus, while interpreting the provisions to be directory in nature, at the same time, it can be laid down that if the objections are not removed within seven days, the applicant while re-filing the application after removing the objections, file an application in writing showing sufficient cause as to why the applicant could not remove the objections within seven days. When such an application comes up for admission/order before the adjudicating authority, it would be for the adjudicating authority to decide as to whether sufficient cause is shown in not removing the defects beyond the period of seven days. Once the adjudicating authority is satisfied that such a cause is shown, only then it would entertain the application on merits, otherwise it will have right to dismiss the application. xxx xxx xxx” (Emphasis Supplied)

5. Learned Senior Counsel appearing for the petitioner submits that the Adjudicating Authority could have considered the petition on merits, only after satisfying itself that sufficient cause has been shown by the petitioner therein, in removing the defects beyond the period of seven days. Thus, the the present case, no such exercise has been carried out and the petition has been registered and is now before the Adjudicating Authority.

6. He, thus, submits that such petition, which has been filed beyond the statutory period as provided by Rule 28, ought not to have been registered and entertained.

7. Responding to the same, learned counsel appearing for the respondent no. 1 draws the attention of this Court to the short affidavit filed on behalf of the respondent no.1, relevant portions of which, are reproduced as under: “xxx xxx xxx xxx xxx xxx”

8. Perusal of the aforesaid affidavit filed on behalf of respondent no.1 clearly shows that the respondent no.1 has admitted that re-filing of the petition, which is the subject matter of the present writ petition, was allowed beyond the statutory period of seven days.

9. This Court records the statement made by learned Senior Counsel appearing for the petitioner that the delay in re-filing in the petition, which is the subject matter of the present petition, is 612 days.

10. In order to streamline the process of re-filing, a Standard Operating Procedure (“SOP”) dated 19th March, 2025, has been issued by the respondent no. 1. The same is reproduced as under: “ “ ”

11. This Court further takes note of the submission made by learned counsel appearing for respondent no. 1 that the action of the Registry in allowing re-filing beyond the seven-day period, was on account of procedural defect, on account of system-generated permissions that allowed the petition to re-enter the scrutiny workflow.

12. Thus, the respondent no. 1 has adopted and improved re-filing module, which restricts re-filing beyond the statutory limit of seven days, unless condonation of such delay is first obtained.

13. Further, this Court also notes that respondent no. 1 has formulated a SOP in reference to Rules 28 and 63 of the Rules, 2016, to streamline the filing and scrutiny process.