The Supreme Court allows appeal in the case of extension of period of limitation

Title: Aditya Khaitan & Ors. v. IL and FS Financial Services Limited

Decided on: 3rd October, 2023

CA 6411-6418/2023 (Arising out of SLP (c) 4789-4796/2021)

CORAM: Hon’ble Justice K.V. Viswanathan

Facts of the Case

The respondent in this case, IL and FS Financial Services Limited (the plaintiff), filed a lawsuit on the file of the High Court in Calcutta for the purpose of recovering money as well as other consequential reliefs. Nine defendants were involved. The Supreme Court is now hearing appeals from the aforementioned nine defendants.

The defendants received a summons in the lawsuit. The 30-day window for submitting written statements lapsed because it was a Commercial Suit. For the nine defendants, the appellants submitted eight applications altogether. In the applications, it was hoped that the written declarations of the defendants would be accepted and the deadline would be extended. According to the affidavit, the World Health Organisation declared COVID-19 a pandemic for the reasons listed in the document. They relied on multiple precedents whereby the Supreme Court took suo motu cognizance of the situation and extended the period of limitation.

Courts analysis and decision

The High Court denied the applicants’ and defendants’ request to have their written statements entered into the record by dismissing the aforementioned motions. The High Court ruled that the applications could not be granted because the 30-day window for submitting written statements had passed. Regarding precedents, the High court argues that the applications for recording written statements cannot be considered since the rulings of this Court under Article 142 of the Indian Constitution only extended “the period of limitation” and not the period up to which delay can be excused.

The Supreme Court stated, “The law assists those who are vigilant, not those who sleep over their rights “Vigilantibus non dormientibus jura subveniunt” – is a fundamental legal maxim on which statutes of limitations are premised. When the whole world was in the grip of a devastating pandemic, it could never have been said that the parties were sleeping over their rights. It is, at this juncture, that this Court stepped in and after taking suo motu cognizance passed orders under Article 142 of the Constitution of India extending the deadlines. The extraordinary situation was dealt with rightly by extraordinary orders protecting the rights of parties by ensuring that their remedies and defences were not barred”

The High Court’s ruling was overturned by the Supreme Court by reiterating principle enshrined in its precedent cases on cognizance for limitation extension, even if those decisions were made after the assailed order because applicants-defendants would profit from the general idea behind the court’s orders. Because of the aforementioned factors, the appeals were granted, and it was ordered that the submitted written statements be recorded.

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Written by- Aashi Narayan

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