Legal Review and Analysis of The Property Company P Ltd vs Rohinten Daddy Mazda 2026 INSC 33
I. Basic Information & Synopsis
Case Title: The Property Company (P) Ltd. vs Rohinten Daddy Mazda
Court: Supreme Court of India
Jurisdiction: Civil Appellate Jurisdiction
Citation: 2026 INSC 33
Coram: Justices J.B. Pardiwala & R. Mahadevan (Bench of Two Judges)
Date of Judgment: January 07, 2026
Synopsis: This judgment addresses the pivotal issue of whether a quasi-judicial body, specifically the Company Law Board (CLB), possesses the inherent power to condone delay in filing an appeal under a special statute (Companies Act, 2013) when the statute itself does not confer such power. The Supreme Court overturned the decisions of the CLB and the High Court, holding that the Limitation Act, 1963, and specifically its Section 5 (condonation of delay), does not automatically apply to tribunals or quasi-judicial bodies. Such a power must be expressly conferred by the statute governing that body. The Court also distinguished between the principles underlying Sections 5 (extension of time) and 14 (exclusion of time) of the Limitation Act, clarifying that while principles akin to Section 14 may be applied by analogy to quasi-judicial bodies in certain circumstances, the discretionary power to extend time under Section 5 cannot be similarly implied.
II. Legal Framework & Precedents
Primary Legislation:
The Companies Act, 2013: Section 58(3) prescribes a 30/60-day limitation period for filing an appeal to the Tribunal (then CLB) against a company's refusal to register share transmission. Section 433 (effective 01.06.2016) expressly makes the Limitation Act, 1963, applicable to proceedings before the NCLT and NCLAT.
The Companies Act, 1956 (Erstwhile Act): Section 10E(4C) defined the CLB's powers, granting it specific powers of a civil court but not the power to condone delay. Section 10F provided for appeals to the High Court and allowed condonation of delay for a further 60 days.
The Limitation Act, 1963: Section 5 grants courts the discretionary power to condone delay in filing appeals/applications upon showing "sufficient cause." Section 14 provides for mandatory exclusion of time spent prosecuting a bona fide proceeding in a wrong forum. Section 29(2) is a savings clause that applies the provisions of the Limitation Act (Sections 4-24) to periods prescribed in special laws, unless expressly excluded, but only when the proceeding is before a "court."Subsidiary Rules: Regulation 44 of the Company Law Board Regulations, 1991, which saves the "inherent power" of the Bench.
Key Precedents Relied Upon/Distinguished:
Town Municipal Council, Athani (1969) & Kerala State Electricity Board (1976): Established that the Limitation Act applies only to proceedings before "courts," not quasi-judicial tribunals, unless expressly provided.
Parson Tools & Plants (1975): Held that tribunals are not "courts" for the purpose of the Limitation Act but left open the possibility of applying the principles of Section 14 by analogy.
M.P. Steel Corporation v. CCE (2015): Applied the principles of Section 14 of the Limitation Act to a quasi-judicial proceeding, emphasizing the distinction between "extension" (S.5) and "exclusion" (S.14) of time.
Ganesan v. TN HR & CE Board (2019): Clarified that Section 29(2) of the Limitation Act is triggered only when a special law prescribes a period for a proceeding before a "court," not a tribunal. It also noted that M.P. Steel pertained to Section 14, not Section 5.
International Asset Reconstruction Co. (2017): Exemplified the need to examine the legislative scheme to see if the power to condone delay was expressly granted or excluded for a specific forum.
Fairgrowth Investments Ltd. (2004): Held that a statutory time limit is mandatory, and the absence of words like "but not thereafter" does not make it directory. The power to condone must be expressly conferred.
III. Relevant Facts of the Case
Parties & Legacy: Respondent, Rohinten Daddy Mazda, was the beneficiary of 20 shares in the appellant company via a will from his mother (died 1989, probate 1990).
Initial Refusal & Limitation: The respondent first sought transmission of shares in March 2013. The appellant company refused via notice dated 30.04.2013. Under the then-governing Companies Act, 1956 (Sections 111(2) & (3)), the appeal period of two months expired on 30.06.2013. No appeal was filed.
Change in Law & Delayed Filing: The Companies Act, 2013 came into force in phases. Section 58 replaced old Section 111 and became effective on 12.09.2013. The respondent filed an appeal under the new Section 58(3) before the CLB on 07.02.2014, after a delay of 249 days from the expiry of the original limitation period (30.06.2013).
Condonation by CLB: The respondent filed an application (C.A. No. 81 of 2014) seeking condonation of delay. The CLB, citing the respondent's residence abroad, wrong initial filing under the repealed Act, and "ends of justice," condoned the delay vide order dated 27.05.2016.
High Court's Decision: The appellant challenged this before the Calcutta High Court. The High Court, relying on certain precedents (Canara Bank, Nupur Mitra) and the subsequent enactment of Section 433 (making Limitation Act applicable to NCLT/NCLAT from 01.06.2016), dismissed the appeal and upheld the CLB's order.
Timeline of Relevant Laws: The critical period was between 12.09.2013 (when S.58 came into force) and 01.06.2016 (when NCLT was constituted and S.433 came into force). During this window, the new substantive law (S.58 of 2013 Act) was administered by the old forum (CLB constituted under the 1956 Act), which lacked a provision like Section 433.
IV. Issues Before the Supreme Court
The Court framed the following two core issues:
Whether the CLB, as a quasi-judicial body, had the power to condone the 249-day delay in filing the appeal under Section 58(3) of the Companies Act, 2013? This involved examining:
The automatic applicability of Section 5 of the Limitation Act, 1963, to tribunals.
Whether the principles underlying Section 5 could be applied by analogy, as has been done for Section 14.
The interpretation of the simpliciter limitation period in Section 58(3).Whether Section 433 of the Companies Act, 2013 (which applied the Limitation Act to NCLT/NCLAT) could be given retrospective effect to cover proceedings pending before the CLB prior to 01.06.2016?
V. Ratio Decidendi & Judgment of the Court
The Supreme Court allowed the appellant's appeal, setting aside the orders of the High Court and the CLB. The ratio decidendi can be summarized as follows:
1. The Limitation Act, 1963, applies only to 'Courts,' not to quasi-judicial bodies or tribunals, unless the governing statute expressly provides for its application. The CLB, constituted under the Companies Act, 1956, was a quasi-judicial body with powers of a civil court only for specific enumerated purposes (S.10E(4C)), which did not include condoning delay.
2. The principles underlying Section 14 (exclusion of time) and Section 5 (extension of time) of the Limitation Act stand on fundamentally different footings. While the mandatory, right-restoring principles of Section 14 can, in appropriate cases and by analogy, be applied to quasi-judicial bodies (as in M.P. Steel), the discretionary power to extend time under Section 5 cannot be so implied. This is because:
* Section 5 involves a discretionary adjustment of the limitation period itself, a power inherently vested in and carefully exercised by civil courts.
* Section 14 involves a mandatory exclusion of time, restoring a litigant to a position within the unaltered statutory period as a matter of right, based on objective criteria.
* A power as significant as condoning delay must be expressly conferred—either via a proviso to the limitation clause (e.g., "provided that the Tribunal may condone delay for up to X days") or via a general provision like Section 433.
3. Regulation 44 of the CLB Regulations (inherent powers) cannot be used to circumvent a mandatory statutory limitation period or to confer a power the legislature consciously withheld. Inherent powers fill procedural gaps; they do not override substantive rights created by limitation.
4. Section 29(2) of the Limitation Act is irrelevant in this context. This section applies only when a special law prescribes a period for a proceeding before a "court." Since S.58(3) prescribed a period for an appeal to a tribunal (CLB), Section 29(2) was not triggered. Consequently, the question of whether S.58(3) "expressly excludes" Sections 4-24 of the Limitation Act does not arise.
5. Section 433 of the 2013 Act cannot be applied retrospectively to the CLB. Section 433 was consciously brought into force alongside the constitution of the NCLT/NCLAT. Applying it to the CLB would be contrary to legislative intent. Furthermore, the respondent's remedy under the old Act was already time-barred in July 2013; a subsequent procedural change cannot revive a dead right.
VI. Legal Framework Established & Clarified
This judgment provides critical clarifications in administrative and company law:
Strict "Express Conferral" Rule for Condonation Powers: It cements the principle that the power to condone delay is not an inherent or implied power of a quasi-judicial body. It must be expressly granted by the parent statute.
Sharp Distinction Between S.5 and S.14 Principles: The Court authoritatively delineates why the jurisprudential leap taken for Section 14 in M.P. Steel cannot be extended to Section 5. This creates a clear doctrinal boundary:
Section 5 Analogy: Not permissible. Requires express statutory grant.
Section 14 Analogy: May be permissible, subject to the scheme of the special law, as it is based on objective conditions and restores a pre-existing right.Body-Specific Application of Limitation Law: The applicability of the Limitation Act is tied intrinsically to the nature of the adjudicating forum (Court vs. Tribunal), not just the subject matter of the dispute.
Interpretation of Simpliciter Limitation Clauses: A provision that simply states an appeal "may" be filed within "X days" is to be read as prescribing a mandatory period. The absence of stronger language like "but not thereafter" does not render it directory or imply a condonation power.
VII. Court's Analysis & Examination
The Supreme Court's analysis was methodical and comprehensive:
Historical & Doctrinal Review: The Court began by tracing the consistent line of authority from Town Municipal Council, Athani onwards, reaffirming the core rule that the Limitation Act governs courts, not tribunals.
Precedent Analysis: It meticulously analyzed key precedents like Parson Tools, M.P. Steel, Ganesan, and International Asset Reconstruction. It distinguished M.P. Steel (S.14) from the present case (S.5) and clarified that Ganesan had already signaled this distinction.
Conceptual Dissection of S.5 vs. S.14: The Court engaged in a deep conceptual analysis, explaining the difference between "extension" (discretionary, alters the period) and "exclusion" (mandatory, computes the period). This formed the crux of its reasoning for treating their underlying principles differently.
Statutory Scheme Scrutiny: The Court examined the phased implementation of the Companies Act, 2013, noting the deliberate legislative choice to empower the new tribunals (NCLT/NCLAT) with S.433 while leaving the old forum (CLB) without such power during the transition.
Rejection of Alternative Arguments: It rejected the applicability of Section 29(2) of the Limitation Act, the reliance on the CLB's inherent powers under Regulation 44, and the retrospective application of Section 433.
VIII. Critical Analysis & Final Outcome
Critical Analysis
This judgment is a robust affirmation of legislative supremacy and textual interpretation in the context of statutory tribunals. It prioritizes legal certainty and the protection of accrued rights (the company's right to treat the claim as time-barred) over equitable considerations for individual litigants. By refusing to imply a condonation power, the Court prevents tribunals from exercising an unstructured discretion that could undermine the definitive nature of limitation statutes.
Strengthens Tribunal Jurisprudence: It provides a clear, predictable rule for when tribunals can and cannot condone delay, reducing litigation on this preliminary issue.
Emphasizes Legislative Intent: The judgment places the onus squarely on the legislature to explicitly grant condonation powers, ensuring such policy choices are deliberate and transparent.
Potential Critique: The rigid distinction may be seen as overly formalistic in cases where a litigant's delay is minimal and bona fide, but the statutory forum lacks the express power to provide relief. However, the Court's solution is to point litigants to the legislature, not to judicial implication.
Final Outcome
The Supreme Court allowed the appeal.
The Impugned Judgment of the High Court dated 16.12.2016 was set aside.
Consequently, the CLB's order dated 27.05.2016, condoning the 249-day delay, was also quashed.
The respondent's company petition (C.P. No. 31 of 2014) before the CLB, being filed beyond the statutory period without a valid condonation, stands dismissed as time-barred.
IX. Multiple Choice Questions
1. According to the Supreme Court in The Property Company (P) Ltd., the power of a quasi-judicial tribunal to condone delay in filing an appeal under a special statute?
a) Is an inherent power flowing from its judicial character.
b) Can be implied from the principles underlying Section 5 of the Limitation Act, 1963.
c) Must be expressly conferred by the special statute governing the tribunal.
d) Automatically applies if the statute uses the word "may" for filing the appeal.
2. The Court drew a fundamental distinction between Section 5 and Section 14 of the Limitation Act, 1963. Which of the following correctly captures this distinction as per the judgment?
a) Section 5 is mandatory, while Section 14 is discretionary.
b) Section 5 involves the exclusion of time, while Section 14 involves the extension of time.
c) The principles underlying Section 14 may be applied to tribunals by analogy, but not those underlying Section 5.
d) Section 29(2) makes Section 5 applicable to special laws but excludes Section 14.
3. Why did the Supreme Court hold that Section 29(2) of the Limitation Act, 1963, was not relevant to the appeal under Section 58(3) of the Companies Act, 2013?
a) Because Section 58(3) expressly excluded the application of the Limitation Act.
b) Because Section 29(2) applies only when a special law prescribes a period for a proceeding before a "court," not a tribunal.
c) Because the delay of 249 days was too inordinate to be covered by Section 29(2).
d) Because the Companies Act, 2013, is a complete code and excludes all other laws.
4. The Supreme Court refused to apply Section 433 of the Companies Act, 2013, retrospectively to the CLB. Which was NOT a reason for this refusal?
a) Section 433 was deliberately brought into force along with the creation of NCLT/NCLAT.
b) Applying it to the CLB would revive the respondent's remedy, which was already time-barred under the old law.
c) The CLB's regulations expressly prohibited the application of the Limitation Act.
d) Legislative intent did not indicate that the CLB was to be empowered with such a power during the transition.
Blog Posts
