Supreme Court Upholds Strict Limitation Period Under Commercial Courts Act, Dismisses 301-Day Delay Condonation Plea

The Supreme Court of India recently delivered a significant judgment in Jharkhand Urja Utpadan Nigam Ltd. & Anr. vs. M/s Bharat Heavy Electricals Limited, reinforcing the strict limitation periods under the Commercial Courts Act, 2015. The case involved a 301-day delay in filing an appeal against a commercial decree worth ₹26.59 crore, where the petitioner sought condonation of delay arguing that the limitation period should only commence from the date of receiving a certified copy of the judgment.

The dispute originated from a civil suit filed by Bharat Heavy Electricals Limited (BHEL) against Jharkhand Urja Utpadan Nigam Ltd. for recovery of dues based on an MSME Council award. The Commercial Court, Ranchi passed a judgment on 09.10.2023, but the appeal was filed only on 04.10.2024 after a 301-day delay. The petitioners argued that under Order XX Rule 1 of CPC (as amended for commercial courts), the limitation period should only begin when copies are provided to parties.

The Supreme Court, comprising Justices J.B. Pardiwala and R. Mahadevan, rejected this contention, observing: “We are afraid it is difficult for us to take the view that the provision referred to above is mandatory. It comes to this that till the Registry does not provide the copy of the judgment, though not demanded, the period of limitation would not commence from the date of the pronouncement of the judgment.” The Court emphasized that the Commercial Courts Act was designed for speedy resolution of disputes and parties cannot shirk their responsibility of being vigilant about limitation periods.

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The judgment extensively analyzed precedents like Housing Board, Haryana v. Housing Board Colony Welfare Association and Sagufa Ahmed v. Upper Assam Polywood Products Private Limited, distinguishing them on grounds that in those cases, parties had made active efforts to procure judgments. The Court noted: “In the present case we find that after the order in question came to be pronounced by the Commercial Court, Ranchi, the appellants herein during the limitation period did not bother to even inquire as to why the said order was not available.”

The Court upheld the Jharkhand High Court’s view that Order XX Rule 1 CPC is directory, not mandatory, for commercial disputes. It agreed with the High Court’s reasoning that: “the speedy resolution of high value commercial dispute cannot be lost sight of. Such an interpretation would be in tune with the scheme and object of the Commercial Courts Act, 2015.” The Supreme Court dismissed the petition, reinforcing that commercial litigants must adhere to strict timelines.

Petitioner Name: Jharkhand Urja Utpadan Nigam Ltd. & Anr..
Respondent Name: M/s Bharat Heavy Electricals Limited.
Judgment By: Justice J.B. Pardiwala, Justice R. Mahadevan.
Place Of Incident: Ranchi, Jharkhand.
Judgment Date: 15-04-2025.
Result: dismissed.

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