30 March 2021
Due to the Covid-19 pandemic, the Supreme Court on March 23, 2020 had ordered an extension of the statutory limitation period during which legal action can be brought or right enforced under various laws.
By way of its judgment dated March 8, 2021, the Supreme Court has directed that such extension will now come to an end, primarily due to the lifting of the lockdown and the resumption of functioning of all Courts and Tribunals either physically or virtually. The aforesaid order prescribes the following manner for computation of limitation:
1. Exclusion of the Period from March 15, 2020 to March 14, 2021 when Computing Limitation
The period from March 15, 2020 to March 14, 2021 (‘Exemption Period’) will stand excluded when computing the period of limitation for filing of any suit, appeal, application, or proceeding.
Illustration: If the cause of action for filing a suit took place on January 1, 2020 and the limitation period is three years, the same will be computed as follows:
(a) January 1, 2020 to March 14, 2020 (73 days); and
(b) The balance 1022 days will be computed from March 15, 2021 onwards.
2. Cases where Limitation Expires between March 15, 2020 and March 14, 2021
Where the actual limitation period has expired during the Exemption Period, it will be extended by the higher of (i) the balance number of days remaining in the limitation period from March 15, 2020; and (ii) 90 days, regardless of the actual balance period of limitation from March 15, 2021.
Illustration 1: If the cause of action for filing of a suit took place on April 15, 2017 and the limitation period is three years (i.e., ending on April 15, 2020), the computation of such period will pause on March 15, 2021. Regardless of the actual balance period being 31 days (March 15, 2020 to April 15, 2020), the limitation for filing the suit will expire 90 days from March 15, 2021, i.e., June 13, 2021.
Illustration 2: If the period of limitation for filing a suit is due to expire on June 23, 2021, the entire balance period of limitation remaining as on March 15, 2021 i.e., 100 days (being more than 90 days), will become available from March 15, 2021 onwards.
3. Special Acts
The Supreme Court has also made the exclusion of the Exemption Period applicable to the computation of periods under all special laws (other than the general law of limitation prescribed under the Limitation Act, 1963), such as the Arbitration and Conciliation Act, 1996, the Negotiable Instruments Act, 1881 and the Commercial Courts Act, 2015.
Way Forward
The directions of the Hon'ble Supreme Court issued under Article 142 read with Article 141 of the Constitution of India are binding on all Courts/Tribunals and authorities in India. The filings/proceedings throughout the country are, therefore, required to adhere to directions on computation of limitation issued by the Hon'ble Supreme Court in its order.
The Supreme Court has also directed the Central Government to amend guidelines applicable to containment zones to allow regulated movement for inter alia legal purposes. This is a positive step by the Supreme Court to ensure access to Courts within containment zones as it ends the extension of limitation.
For further information, please contact:
Zia Mody, Partner, AZB & Partners
zia.mody@azbpartners.com
