MANISH KUMAR v. UNION OF INDIA AND ANOTHER

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legal proceeding is necessary. The right is then unaffected and A preserved. It will be preserved even if a process of quantification is necessary. But there is a manifest distinction between an investigation in respect of a right and an investigation which is to decide whether some right should be or should not be given. On a repeal, the former is preserved by the Interpretation Act. The B latter is not.”(emphasis supplied) It must be mentioned that the object of Section 31(2)(i) is to preserve only the things done and action taken under the repealed Ordinance, and not the rights and privileges acquired and accrued on the one side, and the corresponding obligation or liability incurred on the other side, so that if no right acquired under the repealed C Ordinance was preserved, there is no question of any liability being enforced.

16. Further, it is significant to notice that the saving clause that we are considering in Section 31(2)(i) of the Act, saved things done while the Ordinance was in force; it does not purport to preserve a right acquired under the repealed Ordinance. It is unlike the usual saving clauses which preserve unaffected by the repeal, not only things done under the repealed enactment but also the rights acquired thereunder. It is also clear that even Section 6 of the General clauses Act, the applicability of which is excluded, is not intended to preserve the abstract rights conferred by the repealed Ordinance. It only applies to specific rights given to an individual upon the happening of one or other of the events specified in the statute.”

297Copy pinpoint297. In Kanaya Ram (supra) the predecessor in interest of the appellants had applied for purchase of the tenancy right under the Punjab Security of Land Tenures Act 1953. During the pendency of the proceedings before the Assistant Collector, certain persons were impleaded as respondents on the basis that they were the legal heirs of the landlord. Thereafter, their names were struck off as unnecessary. On the same day, the application of the predecessor in interest of the appellants was allowed. Thereafter, there was certain oral sales by the original land owner. The contention which apparently was taken by the legal heirs of landlord upon his death was that the original landlord died during the pendency of the proceedings, and there was change in the status of the land owners against whom the application under Section H

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A 18(1) of the Act was made as on that date as his legal heirs became small land owners. The Financial Commissioner before whom the matter reached, however, was of the view that the application made by the appellants predecessor being competent on the date it was filed, the rights of the parties had to be adjudicated on that basis. The learned Single Judge of the High Court took the view, however, that the changed situation brought about by the death of the big land owner had to be taken into account in determining the right of the tenant. Respondents 3 to 14 who were the legal heirs of the landlord instituted a suit against the transferees from the landlord on the basis that they were mere benmaidars of the land owner and no title passed to them as the alleged sales were not effected by registered instruments under section 54 which had been extended by the Government of Punjab with effect from 1st April 1955 to the State. The suit came to be decreed. They sought impleadment before the High Court on the ground that the Collector had in determining the surplus area of the land of the land owners held that the sales in favour of respondents 1 and 2 were benami. The Collector D found that on the death of the original land owners, respondents 3 to 14 became small land owners. The Division Bench took the view that no oral sale could be made, and therefore, the transfers made in favour of respondents 1 and 2 did not pass any title. This Court, apart from noticing the fact that as the special leave had been refused against the main judgment the appeal was no longer tenable it, held that the original land owner was not impleaded by the predecessor in interest of the appellants in his application even though respondents 3 to 14 were impleaded and they were subsequently deleted on appellant’s objection that they were not necessary parties. This Court went on to distinguish the judgment in Rameshwar and Others v. Jot Ram and Another90 as it was a case where the tenants after making the requisite application had made the necessary deposit of the first instalment of the purchase price. It was in such circumstances noted that the tenants had acquired a vested right to purchase the land and the case had gone beyond the stage of mere application under section 18(1). This Court noted that the observation of the Court that the rights of the parties are determined “by the facts as they exist on the date of the action” must be held in the context in which they were made. What is relevant is the following statement is the judgment in Kanaya Ram (supra):

90 H (1976) 1 SCC 194

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“10. ……In the present case, Harditta Ram, the predecessor-in- A title of the appellants, when he made the application for purchase under Section 18(1) of the Act, had a mere “hope or expectation of, or liberty to apply for, acquiring a right” and not a “right acquired or accrued” under Section 18(1). It has been held ever since the leading case of Abbott v. Minister for Lands [1895 AC 425 : 64 B LJPC 167 : 72 LT 402 (PC)] [1895 AC 425 : 64 LJPC 167 : 72 LT 402 (PC)] that a mere right to take advantage of the provisions of an Act is not an accrued right. Abbott case [1895 AC 425: 64 LJPC 167 : 72 LT 402 (PC)] has been followed by this Court in a number of decisions. In such a situation, the Court is bound to take into consideration the subsequent events and mould the relief accordingly. The decision in Rameshwar case [(1976) 1 SCC 194 : AIR 1976 SC 49 : (1976) 1 SCR 847] clearly turned on the legal fiction contained in Section 18 (4) (b) of the Act and the death of the large landholder Teja during the pendency of the appeal before the Financial Commissioner on which inheritance opened and his legal heirs became small landholders, could not impair the vested rights acquired by the tenants by virtue of the order passed by the Prescribed Authority and the deposit by them of the first instalment of the purchase price as required under Section 18 (4)(a).” (Emphasis supplied) E

298Copy pinpoint298. While on the ambit of the saving clause we may notice Bansidhar v. State of Rajasthan91 while dealing with the fact of saving clause in a repealing statute the court held as follows: “28. A saving provision in a repealing statute is not exhaustive of the rights and obligations so saved or the rights that survive the repeal. It is observed by this Court in IT Commissioner v. Shah Sadiq & Sons [(1987) 3 SCC 516 : 1987 SCC (Tax) 270 : AIR 1987 SC 1217, 1221] : (SCC p. 524, para 15) “... In other words whatever rights are expressly saved by the ‘savings’ provision stand saved. But, that does not mean that rights which are not saved by the ‘savings’ provision are extinguished or stand ipso facto terminated by the mere fact that a new statute repealing the old statute is enacted. Rights which have accrued

91 (1989) 2 SCC 557 H

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A are saved unless they are taken away expressly. This is the principle behind Section 6(c), General Clauses Act, 1897....” We agree with the High Court that the scheme of the 1973 Act does not manifest an intention contrary to, and inconsistent with, the saving of the repealed provisions of Section 5(6-A) and Chapter III-B of “1955 Act” so far as pending cases are concerned and B that the rights accrued and liabilities incurred under the old law are not effaced. Appellant’s contention (a) is, in our opinion, insubstantial. Re Contention (b)”

299Copy pinpoint299. Petitioners also rely on the judgment of this Court Hitendra C Vishnu Thakur (supra) and Ambalal Sarabhai Enterprises Ltd. (supra).

300Copy pinpoint300. In Hitendra Vishnu Thakur (supra), the case arose under the Terrorist and Disruptive Activities (Prevention) Act, 1987 (TADA Act). Section 20(4) of TADA Act, made Section 167 of the CrPC applicable with certain modifications. Clause (b) provided for a longer period, as the period for which remand could be ordered. By an amendment, w.e.f. 22.05.1993, the period was reduced. Thereafter, however, another clause, viz., clause (bb) was added, which contained a proviso. The proviso mandated that if it was not possible to complete the investigation within a period of 180 days on the Report of the Public Prosecutor, indicating the progress of the investigation and the specific reasons for detention beyond 180 days, the designated court should extend the period upto one year. It was in the context of this provision that this Court, after noting that the amendment was retrospective and apply to pending cases, in which, the investigation was not complete on the date of the Amending Act and the challan had not been filed in the Court, the F Court culled-out the following principles: “26. xxx xxx xxx xxx (i) A statute which affects substantive rights is presumed to be prospective in operation unless made retrospective, either expressly or by necessary intendment, whereas a statute which merely affects procedure, unless such a construction is textually impossible, is presumed to be retrospective in its application, should not be given an extended meaning and should be strictly confined to its clearly defined limits. (ii) Law relating to forum and limitation is procedural in nature, whereas law relating to right of action and right of appeal even though remedial is substantive in nature.

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(iii) Every litigant has a vested right in substantive law but A no such right exists in procedural law. (iv) A procedural statute should not generally speaking be applied retrospectively where the result would be to create new disabilities or obligations or to impose new duties in respect of transactions already accomplished. B (v) A statute which not only changes the procedure but also creates new rights and liabilities shall be construed to be prospective in operation, unless otherwise provided, either expressly or by necessary implication.”

301Copy pinpoint301. Thereafter, the Court also went on to hold, however, that both the amendment clauses (b) and (bb) would apply retrospectively to all pending cases. Thus, it was found that the Amending Act was retrospective and both the clauses would apply to cases which were pending investigation on the date when the amendment came into force and where challan had not been filed till then.

302Copy pinpoint302. In Ambalal Sarabhai Enterprises Ltd. (supra), by an amendment to the Delhi Rent Control Act, while a petition for eviction by the respondent landlord was pending on the ground of subletting, exclusion of the jurisdiction of the Rent Controller with respect of tenancies fetching monthly rent exceeding Rs.3,500/- was brought into force. The question arose, inter alia, as to whether the ground of illegal subletting was a vested right. It also fell for decision as to whether there was merit in the contention of the appellant tenant that after the amendment, the civil court alone had jurisdiction. It was the contention of the tenant that he had no vested right and the amendment was not retrospective in operation, and therefore, the civil court alone would have jurisdiction. The landlord contended that in view of Section 6 of the F General Clauses Act, 1897, the pending proceedings before the Rent Controller should at any rate continue even if his contention based on vested right was repelled. This Court went on to hold that the tenant had no vested right by relying on the judgment of this court in Mohinder Kumar and others v. State of Haryana and another 92 and also in G D. C. Bhatia and others v. Union of India and another 93 (the latter of which decisions is relied upon by the respondent-Union for the proposition that a right to take advantage of an enactment, would not 92 (1985) 4 SCC 221 93 (1995) 1 SCC 104 H

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A create a vested right). Thereafter, this Court went on to hold that the landlord also did not have a vested right for seeking on the ground of eviction under Section 14 of the Delhi Rent Control Act. It was found that Section 14 was only a protective right for a tenant and the various clauses which constituted a proviso to the protection from eviction by a landlord could not be construed as a vested right in favour of the landlord. B Having so held, this Court went on to consider the effect of a repeal of Section 6 of the General Clauses Act. Therein, this Court went on to hold that the respondent-landlord had a right to continue the proceedings before the Rent Control Board under Section 6 of the General Clauses Act. It would be an accrued right in terms of Section 6. We need only notice paragraphs-26, 35 and 36 of Ambalal Sarabhai Enterprises Ltd. (supra): “26. As a general rule, in view of Section 6, the repeal of a statute, which is not retrospective in operation, does not prima facie affect the pending proceedings which may be continued as if the repealed enactment were still in force. In other words, such repeal does not affect the pending cases which would continue to be concluded as if the enactment has not been repealed. In fact when a lis commences, all rights and obligations of the parties get crystallised on that date. The mandate of Section 6 of the General Clauses Act is simply to leave the pending proceedings unaffected which commenced under the unrepealed provisions unless contrary intention is expressed. We find clause (c) of Section 6, refers the words “any right, privilege, obligation … acquired or accrued” under the repealed statute would not be affected by the repealing statute. We may hasten to clarify here, mere existence of a right not being “acquired” or “accrued” on the date of the repeal would not get protection of Section 6 of the General Clauses Act. xxx xxx xxx xxx

35. In cases where Section 6 is not applicable, the courts have to scrutinise and find whether a person under a repealed statute had any vested right. In case he had, then pending proceedings would be saved. However, in cases where Section 6 is applicable, it is not merely a vested right but all those covered under various clauses from (a) to (e) of Section 6. We have already clarified that right and privilege under it is limited to that which is H

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“acquired” and “accrued”. In such cases pending proceedings is to be continued as if the statute has not been repealed.

36. In view of the aforesaid legal principle emerging, we come to the conclusion that since proceeding for the eviction of the tenant was pending when the repealing Act came into operation, Section 6 of the General Clauses Act would be applicable in the present case, as it is the landlord’s accrued right in terms of Section 6. Clause (c) of Section 6 refers to “any right” which may not be limited as a vested right but is limited to be an accrued right. The words “any right accrued” in Section 6(c) are wide enough to include the landlord’s right to evict a tenant in case proceeding was pending when repeal came in. Thus a pending proceeding before the Rent Controller for the eviction of a tenant on the date when the repealing Act came into force would not be affected by the repealing statute and will be continued and concluded in accordance with the law as existed under the repealed statute.” D

303Copy pinpoint303. In Howrah Municipal Corporation and Others v. Ganges Rope Co. Ltd. and Others94 the first respondent company had applied for sanction for construction of its complex of seven floors. By order dated 23.12.1993 the High Court directed sanction to be accorded for the plan up to the 4th floor provided other requirements are complied with. It was also observed that the company would be at liberty to seek further sanction if it was permissible. Sanction was given and construction completed as regards the four floors. Relying on the High Court order, sanction was sought for the remaining floors. The High Court passed an order expressing the expectation that the order would be passed within a period of four weeks relying upon the earlier order. There was correspondence between the parties. While the matter was so pending, the building rules were amended restricting the height of buildings, inter alia. The height being restricted, the application for sanction of additional three floors was rejected. The High Court took the view that the unamended rules and regulations on the date of submission of the application seeking sanction for further construction would govern the matter. This Court on a conspectus of the rules found that the rules did not contemplate ‘deemed sanction’ or ‘deemed refusal’, and therefore, without express sanction there could not be construction. The contention 94 (2004) 1 SCC 663 H

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A however, was that the order of the High court fixing a period to decide its pending application be treated as creating vested right in favour of the respondent. This court held as follows: “37. The argument advanced on the basis of so-called creation of vested right for obtaining sanction on the basis of the Building B Rules (unamended) as they were on the date of submission of the application and the order of the High Court fixing a period for decision of the same, is misconceived. The word “vest” is normally used where an immediate fixed right in present or future enjoyment in respect of a property is created. With the long usage the said word “vest” has also acquired a meaning as “an absolute or C indefeasible right” [see K.J. Aiyer’s Judicial Dictionary (A Complete Law Lexicon), 13th Edn.]. The context in which the respondent Company claims a vested right for sanction and which has been accepted by the Division Bench of the High Court, is not a right in relation to “ownership or possession of any property” D for which the expression “vest” is generally used. What we can understand from the claim of a “vested right” set up by the respondent Company is that on the basis of the Building Rules, as applicable to their case on the date of making an application for sanction and the fixed period allotted by the Court for its consideration, it had a “legitimate” or “settled expectation” to obtain the sanction. In our considered opinion, such “settled expectation”, if any, did not create any vested right to obtain sanction. True it is, that the respondent Company which can have no control over the manner of processing of application for sanction by the Corporation cannot be blamed for delay but during pendency of its application for sanction, if the State Government, in exercise of its rule-making power, amended the Building Rules and imposed restrictions on the heights of buildings on G.T. Road and other wards, such “settled expectation” has been rendered impossible of fulfilment due to change in law. The claim based on the alleged “vested right” or “settled expectation” cannot be set up against statutory provisions which were brought into force by the State Government by amending the Building Rules and not by the Corporation against whom such “vested right” or “settled expectation” is being sought to be enforced. The “vested right” or “settled expectation” has been nullified not only by the Corporation but also by the State by amending the Building Rules. Besides this, such a “settled

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expectation” or the so-called “vested right” cannot be A countenanced against public interest and convenience which are sought to be served by amendment of the Building Rules and the resolution of the Corporation issued thereupon.”

304Copy pinpoint304. In Arcelormittal India Private Limited v. Satish Kumar Gupta & Others95, a judgment rendered by one of us (R.F. Nariman, B J.), this Court dealt with the very Code with which we are concerned. It concerned the scope of Section 29A of the Code declaring ineligibility of certain categories of persons to be resolution applicants. In this context, this Court inter alia, while dealing with the scope of the Code as also the principle of piercing of corporate veil, and after an exhaustive survey of the Code and reiterating the principle that it is settled law that a statute is designed to be workable, a question was posed whether a resolution plan being turned down under Section 30(2) could be challenged. Answering this question, the Court held as follows: “79. Given the timeline referred to above, and given the fact that a resolution applicant has no vested right that his resolution plan be considered, it is clear that no challenge can be preferred to the adjudicating authority at this stage. A writ petition under Article 226 filed before a High Court would also be turned down on the ground that no right, much less a fundamental right, is affected at this stage. This is also made clear by the first proviso to Section E 30(4), whereby a Resolution Professional may only invite fresh resolution plans if no other resolution plan has passed muster. xxx xxx xxx xxx

82. Take the next stage under Section 30. A Resolution Professional has presented a resolution plan to the Committee of F Creditors for its approval, but the Committee of Creditors does not approve such plan after considering its feasibility and viability, as the requisite vote of not less than 66% of the voting share of the financial creditors is not obtained. As has been mentioned hereinabove, the first proviso to Section 30(4) furnishes the answer, G which is that all that can happen at this stage is to require the Resolution Professional to invite a fresh resolution plan within the time-limits specified where no other resolution plan is available with him. It is clear that at this stage again no application before 95 (2019) 2 SCC 1 H

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A the adjudicating authority could be entertained as there is no vested right or fundamental right in the resolution applicant to have its resolution plan approved, and as no adjudication has yet taken place.

305Copy pinpoint305. In Swiss Ribbons (supra), while dealing with constitutional validity of Section 29A of the Code declaring certain persons not to be eligible as resolution applicants, after referring to the decision in Arcelormittal India Private Ltd. (supra), this Court held as follows: “97. It is settled law that a statute is not retrospective merely because it affects existing rights; nor is it retrospective merely because a part of the requisites for its action is drawn from a time antecedent to its passing [see State Bank’s Staff Union (Madras Circle) v. Union of India [State Bank’s Staff Union (Madras Circle) v. Union of India, (2005) 7 SCC 584 : 2005 SCC (L&S) 994] (at para 21)]. In ArcelorMittal [ArcelorMittal (India) (P) Ltd. v. Satish Kumar Gupta, (2019) 2 SCC 1] , this Court has observed that a resolution applicant has no vested right for consideration or approval of its resolution plan as follows: (SCC p. 87, para 82) “82. Take the next stage under Section 30. A Resolution Professional has presented a resolution plan to the Committee of E Creditors for its approval, but the Committee of Creditors does not approve such plan after considering its feasibility and viability, as the requisite vote of not less than 66% of the voting share of the financial creditors is not obtained. As has been mentioned hereinabove, the first proviso to Section 30(4) furnishes the answer, which is that all that can happen at this stage is to require the Resolution Professional to invite a fresh resolution plan within the time-limits specified where no other resolution plan is available with him. It is clear that at this stage again no application before the adjudicating authority could be entertained as there is no vested right or fundamental right in the resolution applicant to have its resolution plan approved, and as no adjudication has yet taken place.”

98. This being the case, it is clear that no vested right is taken away by application of Section 29-A. However, Shri Viswanathan pointed out the judgments in Ritesh Agarwal v. SEBI [Ritesh H

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Agarwal v. SEBI, (2008) 8 SCC 205] (at para 25), K.S. A Paripoornan v. State of Kerala [K.S. Paripoornan v. State of Kerala, (1994) 5 SCC 593] (at paras 60-66), Darshan Singh v. Ram Pal Singh [Darshan Singh v. Ram Pal Singh, 1992 Supp (1) SCC 191] (at para 35), Pyare Lal Sharma v. Jammu & Kashmir Industries Ltd. [Pyare Lal B Sharma v. Jammu & Kashmir Industries Ltd., (1989) 3 SCC 448 : 1989 SCC (L&S) 484] (at para 21), P.D. Aggarwal v. State of U.P. [P.D. Aggarwal v. State of U.P., (1987) 3 SCC 622 : 1987 SCC (L&S) 310] (at para 18), and Govind Das v. CIT [Govind Das v. CIT, (1976) 1 SCC 906 : 1976 SCC (Tax) 133] (at paras 6 and 11), to argue that if a section operates on an antecedent set of facts, but affects a vested right, it can be held to be retrospective, and unless the legislature clearly intends such retrospectivity, the section should not be construed as such. Each of these judgments deals with different situations in which penal and other enactments interfere with vested rights, as a result of which, they were held to be prospective in nature. However, in our judgment in ArcelorMittal [ArcelorMittal (India) (P) Ltd. v. Satish Kumar Gupta, (2019) 2 SCC 1], we have already held that resolution applicants have no vested right to be considered as such in the resolution process. Shri Mukul Rohatgi, however, argued that this judgment is distinguishable as no question of constitutional validity arose in this case, and no issue as to the vested right of a promoter fell for consideration. We are of the view that the observations made in ArcelorMittal [ArcelorMittal (India) (P) Ltd. v. Satish Kumar Gupta, (2019) 2 SCC 1] directly arose on the facts of the case in order to oust the Ruias as promoters from the pale of consideration of their resolution plan, in which context, this Court held that they had no vested right to be considered as resolution applicants. Accordingly, we follow the aforesaid judgment. Since a resolution applicant who applies under Section 29-A(c) has no vested right to apply for being considered as a resolution applicant, this point is of no avail.” G

306Copy pinpoint306. We may observe that the decisions of this Court in Arcelormittal India Pvt. Ltd. (supra) and Swiss Robbins (supra) are inappropriate to the context of the cases before us. We may also notice the decision of the Court of Appeal in West vs. Gwynne96. The plaintiff 96 (1910) WLR 976 H

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A in the said case who was the landlord of the property wrote to the defendant, his tenant for his consent for the proposed underlease. The defendant insisted however on receiving for himself one half of the surplus rental as a condition for the consent. The suit filed by the plaintiff was for a declaration that the defendant could not impose such a condition and that he could give the underlease without any further consent of the B defendant. In the year 1892 (after the lease), section 3 of the Conveyancing Act 1892 was enacted. The question which arose was whether it would apply to existing leases as well as and was of general application or it should be confined to leases after the commencement of the Act. The said section provided that in all leases containing a C covenant against assigning or under letting without license or consent such covenant should unless the lease contain an express provision to the contrary be deemed subject to the proviso that no fine shall be payable for or in respect of such license or consent. The court took the view that the words of the section was clear. In fact, we may profitably notice the words of Joyce, J. whose judgment was the subject matter of the appeal D “the section with which we have to deal with in this case is quite plain to everyone but a lawyer”. The court of appeal took the view that the provision was a general enactment based on ground of public policy, Cozens Hardy M.R. while agreeing with the general proposition that a statute is presumed not to have retrospective operation unless a contrary E intention appears by express words or by necessary implication held as follows: “Retrospective operation is an inaccurate term. Almost every statute affects right which would have been existed but for the statute.

307Copy pinpoint307. Buckley, L.J. went on to hold as follows: “…To my mind the word “retrospective” is inappropriate, and the question is not whether the section is retrospective. Retrospective operation is one matter. Interference with existing rights is another. If an Act provides that as at a past date the law shall be taken to G have been that which it was not, that Act I understand to be retrospective. That is not this case. The question here is whether a certain provision as to the contents of leases is addressed to the case of all leases or only of some, namely, leases executed after the passing of the Act. The question is as to the ambit and scope H

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of the Act, and not as to the date as from which the new law, as enacted by the Act, is to be taken to have been the law.”

308Copy pinpoint308. Reliance has been placed on the judgment of this court in B.K. Educational Services Private Limited v. Parag Gupta and Associates97 which was rendered by one of us (R.F. Nariman, J.). By an amendment to the Code with effect from 6.6.2018 Section 238A was inserted by which the Limitation Act, 1963, was made applicable to the proceedings and appeals before the authorities including the appellate tribunal. The question which fell for decision was whether the Limitation Act 1963 would also apply in respect of application under Section 7 inter alia on and from the commencement of the Code on 1.12.2016 till the date of the amendment that is 6.6.2018. In answering this question, this court went on to hold that the CIRP can only be initiated either by a financial or operational creditor in relation to debts which have not become time barred. In the course of its judgment, this Court referred to the earlier judgment of this Court including the recent judgment of this Court in M.P. Steel Corporation v. Commissioner of Central Excise98. In D the said decision, this Court has relied upon the earlier judgment reported in Smt. Shanti Misra (supra) wherein it was laid down inter alia as follows: “(2) Even though by and large the law of limitation has been held to be a procedural law, there are exceptions to this principle. E Generally, the law of limitation which is in vogue on the date of the commencement of the action governs it. But there are certain exceptions to this principle. The new law of limitation providing a longer period cannot revive a dead remedy. Nor can it suddenly extinguish vested right of action by providing for a shorter period of limitation.” F

309Copy pinpoint309. This Court also held that the application filed in 2016 or 2017 cannot suddenly revive a debt which is no longer due as it is time barred. Apparently, the petitioners are seeking to lay store by the principle that a new law cannot extinguish a vested right of action even if it be pertaining to the period of limitation. G

310Copy pinpoint310. A right of appeal is a vested right, as noticed. However, it becomes vested not because the right is created under the Statute alone. 97 (2019)11 SCC 633 98 (2015) 7 SCC 58 H

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A It becomes vested, as noticed by this Court in Garikapati Veeraya (supra), from the date of institution of the suit. What about a right to sue? In the case of a right to file a civil suit, equally there is a vested right to file a suit but the question would be as to when does it arise. From the line of argument pursued on behalf of the Union that in the case of the right to take advantage of an existing Statute, there is no accrued right, which means also that there is no vested right, should we proceed on the basis that the concept of a vested right qua a civil suit, can be recognized only after the civil suit is filed, at a time when there is no law, ousting or barring a civil suit and a law is passed, during the pendency of a civil suit, which again does not expressly bar the suits, which had already been filed? Since we are in the regions of vested rights, and every right must have a title to the right, and since every civil suit is based on a cause of action, could it not be said that the right to sue becomes vested from the point of time when the cause of action arises? Since, for every civil suit, there is a period of limitation prescribed, could it not be said that since a period of limitation has been prescribed for instituting a suit, the right to sue becomes vested from the first day when the period of limitation starts to run?

311Copy pinpoint311. Order VII Rule 11 of the Code of Civil Procedure contemplates rejection of a plaint, if it does not disclose a cause of action. The cause of action in a suit, will consist of the facts, which, if not traversed by the defendant, will entitle the plaintiff to a Decree. The Schedule to the Limitation Act, 1963, consisting of three columns. The third column, provides for the time, from which, the period begins to run for different suits. Article 19 provides for money payable for money lent. The period of three years, prescribed as period of limitation, begins to run from the point of time, when the loan is made. This means that, at any point of time, after the loan is made, but within three years, ordinarily, a civil suit is to be filed. In the example, we have given, if a suit is filed towards the end of the three-year period, would it be said that the right to sue was not available from the first day, when the period of limitation began to run? We will take another example. Article 73 provides for a G period of one year for a suit for compensation for false imprisonment. The time, from which the period begins to run, is when the imprisonment ends. Can it not be said that the prisoner, upon his incarceration coming to an end, is clothed with a vested right to sue? We would think, that he is given a right, which is vested in him, when the imprisonment ends. In H fact, it is the illegal imprisonment which is really creates the vested right

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but the period of limitation begins on sound policy only after his release. A Article 113 of the Limitation Act, provides for suits for which there is no period provided in the schedule. The period of 03 years provided begins to run when the right to sue accrues. If the right to sue ‘accrued’ within the meaning of Article 113, can it still be said, that for the purpose of deciding, the effect of a law purporting to impact the right, there is no vested right or accrued right till the suit is filed? We will give another example and that is Article 30, which gives a right to sue on the bond subject to a condition. The period of limitation is three years. The time begins to run when the condition is broken. The right to sue clearly could be said to arise, immediately upon the condition being broken. We may, in this context also, notice that one of the five characteristics for a legal right to exist, is that every legal right has a title. It is further stated, in Salmond on Jurisprudence that every legal right has a title, which are apparently the facts or events by reason of which the right has become vested in its owner. Now, it must be noticed also, at this stage that the Limitation Act, in fact, contemplates the time, within which the suit must be brought, beginning necessarily on the supposition, that at least, on the very first day of the period of time, from which a plaintiff can sue, the right is already vested in him. This would reinforce us in our view that a vested right to sue could be said to accrue, and it would always precede the institution of the suit. At any rate, it could be said to exist from the very first day, on which the time begins to run, under the Limitation Act. E Thus, a vested right to sue could be tested with reference not to the date on which the suit is filed as would be the case where a question arises, whether a right of appeal exists.

312Copy pinpoint312. However, we must consider whether a right of suit is conferred by a statute. In this regard, we may notice the decision of this F Court in Mardia Chemicals Ltd. and others v. Union of India and others99. Therein the validity of certain provisions of the SARFAESI Act 2002, was questioned. Of relevance to us, in these cases is the discussion of this Court relating to the vires of Section 17(2). The said provision contemplated a pre-deposit of 75 per cent of the amount by the applicant under Section 17 before the Tribunal. This Court found the condition of G pre-deposit arbitrary and unreasonable. In this context, this court also noted the distinction between a civil suit and an appeal and it was found that an application maintained under section 17 was in the nature of a suit, it is apposite that we notice the following: 99 (2004) 4 SCC 311 H

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A “59.We may like to observe that proceedings under Section 17 of the Act, in fact, are not appellate proceedings. It seems to be a misnomer. In fact it is the initial action which is brought before a forum as prescribed under the Act, raising grievance against the action or measures taken by one of the parties to the contract. It is the stage of initial proceeding like filing a suit in civil court. As a matter of fact proceedings under Section 17 of the Act are in lieu of a civil suit which remedy is ordinarily available but for the bar under Section 34 of the Act in the present case. We may refer to a decision of this Court in Ganga Bai v. Vijay Kumar [(1974) 2 SCC 393] where in respect of original and appellate proceedings a distinction has been drawn as follows: (SCC p. 397, para 15) “There is a basic distinction between the right of suit and the right of appeal. There is an inherent right in every person to bring a suit of civil nature and unless the suit is barred by statute one may, at one’s peril, bring a suit of one’s choice. It is no answer to a suit, howsoever frivolous to claim, that the law confers no such right to sue. A suit for its maintainability requires no authority of law and it is enough that no statute bars the suit. But the position in regard to appeals is quite the opposite. The right of appeal inheres in no one and therefore an appeal for its maintainability must have the clear authority of law. That explains why the right of appeal is described as a creature of statute.”

60. The requirement of pre-deposit of any amount at the first instance of proceedings is not to be found in any of the decisions cited on behalf of the respondent. All these cases relate to appeals. The amount of deposit of 75% of the demand, at the initial proceeding itself sounds unreasonable and oppressive, more particularly when the secured assets/the management thereof along with the right to transfer such interest has been taken over by the secured creditor or in some cases property is also sold. Requirement of deposit of such a heavy amount on the basis of a one-sided claim alone, cannot be said to be a reasonable condition at the first instance itself before start of adjudication of the dispute. Merely giving power to the Tribunal to waive or reduce the amount, does not cure the inherent infirmity leaning one-sidedly in favour H

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of the party, who, so far has alone been the party to decide the amount and the fact of default and classifying the dues as NPAs without participation/association of the borrower in the process. Such an onerous and oppressive condition should not be left operative in expectation of reasonable exercise of discretion by the authority concerned. Placed in a situation as indicated above, where it may not be possible for the borrower to raise any amount to make the deposit, his secured assets having already been taken possession of or sold, such a rider to approach the Tribunal at the first instance of proceedings, captioned as appeal, renders the remedy illusory and nugatory. xxx xxx xxx xxx C

64. The condition of pre-deposit in the present case is bad rendering the remedy illusory on the grounds that: (i) it is imposed while approaching the adjudicating authority of the first instance, not in appeal, (ii) there is no determination of the amount due as yet, (iii) the secured assets or their management with transferable interest is already taken over and under control of the secured creditor, (iv) no special reason for double security in respect of an amount yet to be determined and settled, (v) 75% of the amount claimed by no means would be a meagre amount, and (vi) it will leave the borrower in a position where it would not be possible for him to raise any funds to make deposit of 75% of the undetermined demand. Such conditions are not alone onerous and oppressive but also unreasonable and arbitrary. Therefore, in our view, sub- section (2) of Section 17 of the Act is unreasonable, arbitrary and violative of Article 14 of the Constitution.” F (Emphasis supplied)

313Copy pinpoint313. Thus, a right to sue is not created by the statute. It is an inherent right unless is barred by some law. Therefore, the principle that a right to take advantage of a statute not being an accrued right may not apply. We may also use this occasion to repel the argument based on G Mardia Chemicals (supra) that the application under Section 7 is akin to a civil suit. The context of the application under Section 17 of SARFAESI Act is completely different from that of the code. The application under Section 17 of the SARFAESI was found to be in lieu of a suit. The allottee has other remedies unlike the applicant under H

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A Section 17. All the assets of the debtor are taken over. The situation cannot be compared. No doubt, the argument of the learned ASG is based on the right under Section 7 of the Code being a mere right to take advantage of a statute. In Abbott (supra), in the context of a saving enactment, the Court observed that a mere right assuming it to exist in the members of the public or any class, then, to take advantage of an enactment, without any act done by the individual, towards availing himself of that right, could not be treated as an accrued right under the enactment. Therefore, the stand appears to be that the right under Section 7 is a mere right to take advantage of an enactment. It is the further case of the Union, apparently that, only upon an application being filed and what is more, it is admitted under Section 7(5), that a vested right would accrue.

314Copy pinpoint314. We do not think that the principles which have been laid down, may apply in the case of a vested right of action. We take the view that a plaintiff has a vested right, depending on whether there is a D cause of action and a period of limitation, which has begun to run, which necessarily involves, the existence of a vested right. In the case of an application under Section 7 of the Code, we may notice that it is a valuable right, no doubt, statutory in nature. It cannot be the law that a Statute cannot create vested rights. Should the ingredients which the Legislature contemplate exist in favour of a person as an action in law, it can also be described as a vested right. The application, under Section 7, is an application, which attracts the period of limitation, which has already been noticed. It commences from the time when the right to sue accrues. In every case, where the period of limitation began to run, in respect of debt prior to the Code coming into being, the right to sue would have arisen earlier. In this regard we may refer to Isha Valimohamed (supra).

315Copy pinpoint315. In regard to the effect of this finding on the challenge to the first and the second provisos in Section 7, we must immediately observe that the impugned first and second provisos have only prospective operation. We have already found that the provisos first and second are valid. They can survive, even if the third proviso is struck down. The third proviso is on the other hand dependant on the first and second provisos and cannot survive their invalidation. The vested right cannot exist merely by reason of Section 7. It must depend upon the vestitive facts which would create the right in conjunction with Section 7. We need not probe the matter further in those cases where only the first and H

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second provisos can be questioned. This is so in two writ petitions, W.P. A No. 228 of 2020 and W.P. No. 850 of 2020, where, though there are no applications filed under Section 7 before the amendment, the third proviso is also challenged, which cannot be countenanced.

316Copy pinpoint316. There is, in our view, a right which is vested in the cases where, the petitioners have filed application, fulfilling the requirements B under unamended Section 7 of the Code. The very act of filing the application, even satisfies the apparent test propounded by the Additional Solicitor General, that the right under Section 7 is only one to take advantage of the statute and unless advantage is actually availed it does not create an accrued right. When applications were filed under the unamended provisions of Section 7, at any rate it would transform into a C vested right. The vested right is to proceed with the action till its logical and legal conclusion. We are unable to accept the stand of the learned ASG, that a vested right to emerge still require an order under Section 7(5) of the Code. It is no doubt a stage, when the authority finds there is default and takes the matter forward including appointing to begin with the IRP and ordering a moratorium. In this regard, it is to be noted that in the scheme of the Code, what takes place before admission, is that the applicant tries to establish the debt and default. This is akin to the stage of a trial in a suit. No doubt, this happens only if the application is free from defects. But this is a far cry from saying that a vested right of action did not inhere even on the version of the ASG upon the act of the creditor invoking the Code.

317Copy pinpoint317. In P.D. Aggrawal & others v. State of U.P and others.100, the Court was dealing with a challenge to statutory rules, inter alia, by which temporary Assistant Engineers who were working continuously since the date of their appointment in the cadre of Assistant Engineer F were deprived of their services from the date of substantial appointment to the temporary post for the purpose of seniority. This Court in the context of rules and the impact it had held as follows: “18. It has been held by this Court in E.P. Royappa v. State of Tamil Nadu [AIR 1974 SC 555, 583 : (1974) 4 SCC 3 : 1974 SCC G (L&S) 165] , Maneka Gandhi v. Union of India [AIR 1978 SC 597, 624 : (1978) 1 SCC 248] that there should not be arbitrariness in State action and the State action must ensure fairness and equality of treatment. It is open to judicial review whether any 100 (1987) 3 SCC 622 H

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A rule or provision of any Act has violated the principles of equality and non-arbitrariness and thereby invaded the rights of citizens guaranteed under Articles 14 and 16 of the Constitution….” It was also after noting the facts stated as follows: “..Thus the 1969 and 1971 amendments in effect take away from the officers appointed to the temporary posts in the cadre through Public Service Commission i.e. after selection by Public Service Commission, the substantive character of their appointment. These amendments are not only disadvantageous to the future recruits against temporary vacancies but they were made applicable retrospectively from March 1, 1962 even to existing officers recruited against temporary vacancies through Public Service Commission. As has been stated hereinbefore that the Government has power to make retrospective amendments to the Rules but if the Rules purport to take away the vested rights and are arbitrary and not reasonable then such retrospective amendments are subject to judicial scrutiny if they have infringed Articles 14 and 16 of the Constitution.”

318Copy pinpoint318. We may notice two aspects. Firstly, it was a challenge to a statutory rule. The Court went on to observe that it could be the overturned if it is arbitrary. We have already taken note that in regard to the challenge to a law made by the legislature under Article 14 that what is required is that a law must be manifestly arbitrary. The said concept has been explained in Shayara Bano (supra) (paragraph-101).

319Copy pinpoint319. In Darshan Singh v. Ram Pal Singh and Ors. 101, the appellants challenged certain alienations as being contrary to custom under the State law of the year 1920. The matter was at the appellate stage in suits filed by the appellants.

320Copy pinpoint320. In 1973, the law was amended. On the basis of same, the High Court dismissed the suit on the basis of that, after the amending Act came into force there could not be a challenge to the transfer. The G contentions of the appellants was that the amending Act could not be read as retrospective. The original enactment permitted challenging the transfer on the ground that the transfer was contrary to custom. It was this right which was sought to be subjected to certain conditions.

101 H 1992(Suppl)1 SCC 191

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[K. M. JOSEPH, J.]

321Copy pinpoint321. We may notice that this case did not involve a challenge to A the amendment. In the course of the judgement, the Court took the view what was taken away was the basic right to ‘contest’, the transfer irrespective of whether it was in a suit or appeal. The Court concluded that by the amending Act the custom was done away with.

322Copy pinpoint322. In K.S. Paripoornan v. State of Kerala102, the Constitution B Bench had to consider whether Section 23 (I-A) and introduced by the amending Act 1984 was retrospective. In the majority judgement by S. C. Agrawal, J., we notice the following: “64. A statute dealing with substantive rights differs from a statute which relates to procedure or evidence or is declaratory in nature C inasmuch as while a statute dealing with substantive rights is prima facie prospective unless it is expressly or by necessary implication made to have retrospective effect, a statute concerned mainly with matters of procedure or evidence or which is declaratory in nature has to be construed as retrospective unless there is a clear indication that such was not the intention of the legislature. A D statute is regarded retrospective if it operates on cases or facts coming into existence before its commencement in the sense that it affects, even if for the future only, the character or consequences of transactions previously entered into or of other past conduct. By virtue of the presumption against retrospective applicability of E laws dealing with substantive rights transactions are neither invalidated by reason of their failure to comply with formal requirements subsequently imposed, nor open to attack under powers of avoidance subsequently conferred. They are also not rendered valid by subsequent relaxations of the law, whether relating to form or to substance. Similarly, provisions in which a F contrary intention does not appear neither impose new liabilities in respect of events taking place before their commencement, nor relieve persons from liabilities then existing, and the view that existing obligations were not intended to be affected has been taken in varying degrees even of provisions expressly prohibiting G proceedings. (See: Halsbury’s Laws of England, 4th Edn. Vol. 44, paras 921, 922, 925 and 926).” (Emphasis supplied)

102 (1994) 5 SCC 593 H

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323Copy pinpoint323. In State Bank’s Staff Union (Madras Circle) v. Union of India and others103, an award was passed by the Industrial Tribunal, which was impugned before the High Court. When the matter was so pending, the State Bank of India Act came to be amended. The contention of the appellants was that the amendment was intended to nullify the decision of the High Court, which was repelled. The Court also B considered the power of the sovereign Legislature to make retrospective legislation. The Court held as follows: “21. Every sovereign legislature possesses the right to make retrospective legislation. The power to make laws includes the power to give it retrospective effect. Craies on Statute Law (7th C Edn.) at p. 387 defines retrospective statutes in the following words: “A statute is to be deemed to be retrospective, which takes away or impairs any vested right acquired under existing laws, or creates a new obligation, or imposes a new duty, or attaches a new disability in respect to transactions or considerations already past.”

22. Judicial Dictionary (13th Edn.) by K.J. Aiyar, Butterworth, p. 857, states that the word “retrospective” when used with reference to an enactment may mean (i) affecting an existing contract; or (ii) reopening up of past, closed and completed transaction; or (iii) affecting accrued rights and remedies; or (iv) affecting procedure. Words and Phrases, Permanent Edn., Vol. 37-A, pp. 224-25, defines a “retrospective or retroactive law” as one which takes away or impairs vested or accrued rights acquired under existing laws. A retroactive law takes away or impairs vested rights acquired under existing laws, or creates a new obligation, imposes a new duty, or attaches a new disability, in respect to transactions or considerations already past.

23. In Advanced Law Lexicon by P. Ramanath Aiyar (3rd Edn., 2005) the expressions “retroactive” and “retrospective” have been defined as follows at p. 4124, Vol. 4: G “Retroactive. — Acting backward; affecting what is past. (Of a statute, ruling, etc.) extending in scope or effect to matters that have occurred in the past. — Also termed retrospective. (Black’s Law Dictionary, 7th Edn., 1999) 103 H AIR 2005 SC 3446 / (2005) 7 SCC 584

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‘ “Retroactivity” is a term often used by lawyers but rarely defined. On analysis it soon becomes apparent, moreover, that it is used to cover at least two distinct concepts. The first, which may be called “true retroactivity”, consists in the application of a new rule of law to an act or transaction which was completed before the rule was promulgated. The second concept, which will be referred to as “quasi-retroactivity”, occurs when a new rule of law is applied to an act or transaction in the process of completion…. The foundation of these concepts is the distinction between completed and pending transactions….’ T.C. Hartley, Foundations of European Community Law, p. 129 (1981). C Retrospective. — Looking back; contemplating what is past. Having operation from a past time. ‘Retrospective’ is somewhat ambiguous and that good deal of confusion has been caused by the fact that it is used in more senses than one. In general, however, the courts regard as retrospective any statute which operates on cases or facts coming into existence before its commencement in the sense that it affects, even if for the future only, the character or consequences of transactions previously entered into or of other past conduct. Thus, a statute is not retrospective merely because it affects existing rights; nor is it retrospective merely because a part of the requisite for its action is drawn from a time antecedent to its passing.” (Vol. 44, Halsbury’s Laws of England, 4th Edn., p. 570, para 921.) xxx xxx xxx xxx F

25. In Harvard Law Review, Vol. 73, p. 692 it was observed that: “It is necessary that the legislature should be able to cure inadvertent defects in statutes or their administration by making G what has been aptly called ‘small repairs’. Moreover, the individual who claims that a vested right has arisen from the defect is seeking a windfall since had the legislature’s or administrator’s action had the effect it was intended to and could have had, no such right would have arisen. Thus the interest in the retroactive curing of H

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A such a defect in the administration of the Government outweighs the individual’s interest in benefiting from the defect.”

26. The above passage was quoted with approval by the Constitution Bench of this Court in the case of Asstt. Commr. of Urban Land Tax v. Buckingham and Carnatic Co. Ltd. [(1969) B 2 SCC 55] In considering the question as to whether the legislative power to amend a provision with retrospective operation has been reasonably exercised or not, various factors have to be considered. It was observed in the case of Stott v. Stott Realty Co. [284 NW 635] as noted in Words and Phrases, Permanent Edn., Vol. 37- A, p. 2250 that: C “The constitutional prohibition of the passage of ‘retroactive laws’ refers only to retroactive laws that injuriously affect some substantial or vested right, and does not refer to those remedies adopted by a legislative body for the purpose of providing a rule to secure for its citizens the enjoyment of some natural right, equitable D and just in itself, but which they were not able to enforce on account of defects in the law or its omission to provide the relief necessary to secure such right.” 27.Craies on Statute Law (7th Edn.) at p. 396 observes that: E “If a statute is passed for the purpose of protecting the public against some evil or abuse, it may be allowed to operate retrospectively, although by such operation it will deprive some person or persons of a vested right.”

F (Emphasis supplied)

324Copy pinpoint324. The Court also repelled the argument that vested rights cannot be taken away by the Legislature by way of retrospective legislation. In paragraph-35, the Court held as follows: “31. Learned counsel for the appellant submitted that vested rights G cannot be taken away by the legislature by way of retrospective legislation. The plea is without substance. Whenever any amendment is brought in force retrospectively or any provision of the Act is deleted retrospectively, in this process rights of some are bound to be affected one way or the other. In every case the exercise by the legislature by introducing a new provision or deleting H

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an existing provision with retrospective effect per se does not amount to violation of Article 14 of the Constitution. The legislature can change, as observed by this Court in Cauvery Water Disputes Tribunal, Re [1993 Supp (1) SCC 96 (2)] the basis on which a decision is given by the Court and thus change the law in general, which will affect a class of persons and events at large. It cannot, however, set aside an individual decision inter partes and affect their rights and liabilities alone. Such an act on the part of the legislature amounts to exercising the judicial power by the State and to function as an appellate court or tribunal, which is against the concept of separation of powers.” (Emphasis supplied) C

SECTION 6 OF GENERAL CLAUSES ACT, 1897

325Copy pinpoint325. In this regard, no support can be drawn from Section 6 of the General Clauses Act, 1897. Section 6 makes it clear that the rights or privileges which may be asserted are subject to the law not being couched contrary to such rights/privileges. In this case it is precisely because the 3rd proviso covers the applications filed prior to the amendment which had not been admitted, that the petitioners have challenged the provision. READING DOWN

326Copy pinpoint326. Further, the appeal to invoke the principle of reading down the proviso is untenable. In his judgment for the majority Sawant, J. in Delhi Transport Corpn. v. D.T.C. Mazdoor Congress 104 held as follows: “255. It is thus clear that the doctrine of reading down or of recasting the statute can be applied in limited situations. It is essentially used, firstly, for saving a statute from being struck down on account of its unconstitutionality. It is an extension of the principle that when two interpretations are possible — one rendering it constitutional and the other making it unconstitutional, the former should be preferred. The unconstitutionality may spring from either the incompetence of the legislature to enact the statute or from its violation of any of the provisions of the Constitution. The second situation which summons its aid is where the provisions of the statute are vague and ambiguous and it is possible to gather 104 (1991) Suppl.(1) SCC 600 H

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A the intentions of the legislature from the object of the statute, the context in which the provision occurs and the purpose for which it is made. However, when the provision is cast in a definite and unambiguous language and its intention is clear, it is not permissible either to mend or bend it even if such recasting is in accord with good reason and conscience. In such circumstances, it is not possible for the court to remake the statute. Its only duty is to strike it down and leave it to the legislature if it so desires, to amend it. What is further, if the remaking of the statute by the courts is to lead to its distortion that course is to be scrupulously avoided. One of the situations further where the doctrine can never be called into play is where the statute requires extensive additions and deletions. Not only it is no part of the court’s duty to undertake such exercise, but it is beyond its jurisdiction to do so.”

327Copy pinpoint327. Now, the terms of the proviso are clear. It does not admit of more than one interpretation at least in terms of the matter covered by it. The only area left is the impact of the withdrawal which is to happen.

328Copy pinpoint328. We may also notice the judgment of this Court in Vijay v. State of Maharashtra105. The appellant was elected as a member of the Panchayat in 2000 and elected as the Sarpanch. He was further elected as Councillor of the Zila Parishad. An amendment was made with effect from 8.8.2003. Under the marginal note Disqualifications, Section 14, inter alia, disentitled a person from continuing as a Panchayat Member if he was elected a Councillor of the Zila Parishad. This Court found that it was a disqualifying law intended to have retrospective effect. We may notice para 12 which reads as follows: F “12. The appellant was elected in terms of the provisions of a statute. The right to be elected was created by a statute and, thus, can be taken away by a statute. It is now well settled that when a literal reading of the provision giving retrospective effect does not produce absurdity or anomaly, the same would not be construed G to be only prospective. The negation is not a rigid rule and varies with the intention and purport of the legislature, but to apply it in such a case is a doctrine of fairness. When a law is enacted for the benefit of the community as a whole, even in the absence of a

105 (2006) 6 SCC 289 H

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provision, the statute may be held to be retrospective in nature. A The appellant does not and cannot question the competence of the legislature in this behalf.” The case did not involve a challenge to the law. What is significant is the statement that the right created by a Statute, can be taken away by a statute. B

329Copy pinpoint329. We find that qua the financial creditors covered by the third proviso, having invoked, at any rate unamended Section 7, they had a vested right.

330Copy pinpoint330. They had undoubtedly a vested right to have their actions carried to its logical and legal end. No doubt, the question of admission of the application arises under Section 7(5) of the Code. It is open to the Adjudication Authority to reject the application but that does not mean that the applicants had no vested right of action. The possibility of a plaint being rejected under Order VII Rule 11 or an appeal being dismissed under Order XLI Rule 11 without notice being issued to the respondent or the fact that the suit can be dismissed at later stages, cannot detract from the right of the plaintiff or the appellant, being a substantive right. The same principle should suffice to reject the contention, based on admission under Section 7(5) alone, giving rise to the vested right in regard to an applicant under Section 7 of the Code. E

331Copy pinpoint331. A vested right is not limited to property rights. A right of action should conditions otherwise exist, can also be a vested right. Such a right can be created by a Statute and even on a repeal of such a Statute, should conditions otherwise exist, giving a right under the repealed Statute, the right would remain an accrued right [See Isha Valimohamed (supra)]. F

332Copy pinpoint332. No doubt, there may not be a vested right as regard mere procedure and while limitation, ordinarily, belongs to the domain of procedure, should new law shorten the existing period of limitation, such a law would not operate in regard to the right of action which is vested [See Shanti Misra (supra)]. A party may not have a vested right of G Forum as distinct from the vested right of action [See Shanti Misra (supra)].

333Copy pinpoint333. Every sovereign Legislature is clothed with competence to make retrospective laws. It is open to the Legislature, while making retrospective law, to take away vested rights. If a vested right can be H

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A taken away by a retrospective law, there can be no reason why the Legislature cannot modify the vested rights [See State Bank’s Staff Union (Madras Circle) (supra)].

334Copy pinpoint334. In an action, where the law is not challenged, the Court would ordinarily proceed as follows. It will presume that a law, which affects substantive rights, are meant to have prospective operation only. In the same way, as regards procedural laws or the laws relating to a mere matter of procedure or of Forum, they carry retrospective impact.

335Copy pinpoint335. A Statute is not retrospective merely because it affects existing rights. This is, however, in regard to the future operation of law qua the existing rights. If the existing right is modified or take away and it is to have operation only from the date of new law, it would obviously have only prospective operation and it would not be a retrospective law.

336Copy pinpoint336. Declaratory, clarificatory or curative Statutes are allowed to hold sway in the past. The very nature of the said laws involve the aspect of public interest which requires sovereign Legislature to remove defects, clarify aspects which create doubt. The declaratory law again has the effect of the legislative intention being made clear. It may not be apposite in the case of these Statutes to paint them with the taint of retrospectivity.

337Copy pinpoint337. What then is retrospectivity? It is ordinarily the new law being applied to cases or facts, which came into existence prior to the enacting of the law. A retrospective law, in other words, either supplants an existing law or creates a new one and the Legislature contemplates that the new law would apply in respect of a completed transaction. It may amount to reopening, in other words, what is accomplished under the earlier law, if there was one, or creating a new law, which applies to a past transaction.

338Copy pinpoint338. “A Statute is to be deemed to be retrospective, which takes away or impairs any vested right acquired under any existing laws or creates a new obligation or imposes a new duty or attaches a new disability in respect to transactions or considerations already passed”. [See Craies on State Law, 7th Edition, Page-387].

339Copy pinpoint339. In Halsbury’s Laws of England, 4 th Edition, Page-570, paragraph-921, it is, inter alia, stated as follows - “In general, however, court regarded as retrospective, any Statute, which operates on cases or facts, coming into existence, before its commencement, in the sense

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that it affects even if for the future only, the character or consequences of transactions, previously entered into or of other past conduct”.

340Copy pinpoint340. When a Statute made by the sovereign Legislature is found to have retrospective operation and the challenge is made under Article 14 of the Constitution, (i) the Court must consider whether the law, in its retrospectivity, manifests forbidden classification. (ii) Whether the law, in its retrospectivity, produces manifests arbitrariness, (iii) if a law is alleged to be violative of Article 19(1)(g), firstly, the Court, in an action by a citizen, would, in the first place, find whether the right claimed, falls, within the ambit of Article 19(1)(g). The Court will further enquire as to whether such a law is made, inter alia, by way of placing reasonable restrictions by looking into the public interest. In the case of law, which is found to be not unfair, it would also not fall foul of Article 21.

341Copy pinpoint341. Where the law is challenged on the ground that it is violative of Fundamental Rights under Article 14, necessarily the Court must enquire whether it is a capricious, irrational, disproportionate, excessive and, finally, without any determining principle. [see Shayara Bano case D (supra)] The right of a citizen, or for that matter, any person under Article 14, is a right which is personal to him.

342Copy pinpoint342. The golden thread which runs through the grounds making up the Doctrine of Manifest arbitrariness Injustice, undoubtedly, consists of total absence of public interest, of which the sovereign Legislature as E the supreme law giver, is the undoubted custodian. Though made in the context of the power of the Court in England, in regard to taking into consideration the concept of fairness, while deciding upon the issue of retrospectivity, we would think the following passage in the Principles of Statutory Interpretation by Justice G.P. Singh, made relying upon the F Judgment of the House of Lords in L’Office Cherifien Des Phosphates and another And Yamashita-Shinnihon Steamship Co. Ltd.106, would furnish a safe and fairly comprehensive guide, even in the matter of determining the constitutionality of a retrospective law. Hence, we refer to the same and would approve of the same. G “… It was observed that the question of fairness will have to be answered in respect of a particular statute by taking into account various factors viz., value of the rights which the statute affects; extent to which that value is diminished or extinguished by the 106 (1994) 1 AllER 20 H

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A suggested retrospective effect of the statute; unfairness of adversely affecting the rights; clarity of the language used by Parliament and the circumstances in which the legislation was created. “All these factors must be weighed together to provide a direct answer to the question whether the consequences of reading the statue with the suggested degree of retrospectivity is so unfair that the words used by Parliament cannot have been intended to mean what they might appear to say.” (Emphasis supplied)

343Copy pinpoint343. Having laid down the principles, we shall now apply the same to the facts of the present cases before us. As far as the nature of the right in question is concerned, which would include the value of the rights, it is a right of action. The right of action is, undoubtedly, a vested right. The role of the applicant essentially fades out after the admission of the application is made under Section 7(5). The scheme of the Code has been unraveled by us. The right, which is given, is a right in rem. It D is not a mere personal right, in the sense that it is right in rem. The applicant is not even required to plead the default qua him as the default to any financial creditor, in the requisite sum, provided it is not barred under Article 137, suffices. The consequences of the application would be that it may land the applicant and also all the stakeholders, in liquidation of the corporate debtor.

344Copy pinpoint344. As far as, the manner, in which, the value of the right is affected or if we may use the word ‘impaired’, it is another most significant aspect, to be borne in mind. The manner, in which, a particular Statute carrying retrospective effect, will impair, the rights will depend on the facts of each case. We have, for instance, noticed the clear unfairness, which, the Rule in question carried qua a set of employees in regard to their vested right, in P.D. Aggrawal (supra). The vested right, in fact, consisted of the right to have certain period reckoned for the purpose of seniority. As far as the clarity of the language used, there does not appear to be any ambiguity, and what Parliament intended is, completely free from doubt. The only area where any ambiguity can be said to exist – is the effect of the application being treated as withdrawn. The further aspect, which is to be borne in mind, is the circumstances in which the legislation is created. It is here that the mischief rule and the aspect of public interest looms large. At the end of the day, the tussle is between the individual right versus the public interest. Now, public interest

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is a concept, which is capable of embracing, within its scope, the interest of different sections of the public. This would include the sections of the public to which the applicant himself belongs. Public interest would, undoubtedly, also encompass, the economy of the country, which can be understood in terms of all the objects, for which the Code was enacted. They would include the speed with which the Code is worked. It would include, also, safeguarding the interests of all the stakeholders. This may necessarily include the corporate debtor as a stakeholder, being protected from applications, which are perceived as frivolous or not representing a critical mass.

345Copy pinpoint345. We have noticed the statistics which has been made available by the Union. On the eve of the ordinance on the 27.12.2019, it would appear that 2201 applications, came to be moved, during a period of nearly eighteen months as in comparison to 253 applications during the preceding period representing a nearly 10-fold increase.

346Copy pinpoint346. Now, the third proviso, thus, indeed, does not say that as on the date of filing of the applications, the law was what is contained in the first and the second provisos. In that sense, it could be said that it was not retrospective. We have found that when invoking the unamended Section 7 applications stood moved, they evinced creation of vested rights to continue with the proceeding. The applications were, no doubt, at the stage, prior to the admission under Section 7(5). It is at this stage that through the device of the third proviso, the Parliament has applied the principle of first and second proviso of threshold requirement, in respect of pending applications, which is made to appear as it would have operation in the future. Now here we must address an argument of the 3rd proviso going to mere procedure. The financial creditors covered by the 3rd proviso were clothed with a statutory right under Section 7. This right was available to be exercised by an individual creditor, by himself or jointly with others. The imposition of a threshold requirement being a mandatory and irreducible minimum even, if it is to be achieved as and after the date of the amendment, constitutes an intrusion into the substantive right of action vested in the individual creditor. The action of the creditor was not a completed transaction. As regards his conduct in the past, viz., moving under Section 7, it is incomplete but the action was commenced. But the law (the 3rd proviso) impairs the past action qua the future. We would find as follows. Imposing the threshold requirement under the 3 rd proviso, is not a mere matter of procedure. It impairs vested rights. It H

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A has conditioned the right instead, in the manner provided in the first and the second proviso. We have already upheld the first and second proviso, which, in fact, operates only in the future. In that sense, the Legislature has purported to equate persons who had not filed applications with persons like the petitioners who had filed the applications under the unamended law. B

347Copy pinpoint347. At this point, we must notice one argument, which is that, the Law Giver has discriminated between applicants under Section 7, which were pending at different stages. We may notice, in this regard, however, that all the applicants share the common characteristic of being applicants in applications which were not admitted. In fact, most of the applications C would appear to have been filed in the year 2019. Enquiring further into the different stages in these applications, would go against the principle that the Court does not look to mathematical nicety or perfection in the law. The Court also bears in mind, the principle that the law is an economic measure. D CLARITY REGARDING ‘WITHDRAWAL’ UNDER THE THIRD PROVISO

348Copy pinpoint348. One of the aspects to be considered is the clarity of a retrospective law. The requirement of compliance with the threshold numerical requirements under the first and second proviso is an integral and inseparable part of the third proviso. Let us have a look at the consequences that follow if the numerical strength cannot be cobbled up by the applicant. The proviso declares that in such an eventuality the application will be treated as withdrawn before admission. Rule 8, as noticed by us, provides for power with the Tribunal to allow withdrawal before admission. Does it mean that an applicant can file a fresh application after gathering together the requisite numbers? What is the impact of withdrawal under provisions under the general law? What is the impact of the law relating to the Limitation Act in respect of the application which has been withdrawn?

349Copy pinpoint349. In the context of a Civil suit, Order XXIII deals with withdrawal and adjustment of suit. Order XXIII (1)(4b) prohibits a fresh suit in respect of the same subject matter (cause of action), if a suit is withdrawn without permission of the Court under Order XXIII(1)(3).

350Copy pinpoint350. In the facts of the case before us the third proviso does not indicate as to whether a fresh application after complying with the H

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requirement of the ingredients of the first and second proviso is maintainable. It does not also indicate what would be the position even if such application is maintainable by the same applicant, with regard to the periods spent in the context of ruling of this Court that the Limitation Act applies and the relevant Article is Article 137 and therefore, any application filed beyond the period of three years from the date of the default is barred.

351Copy pinpoint351. The other way of looking at these issues is that Order XXIII(1) applies only in the case of a civil suit. In regard to the application under Article 137 which is what an application under Section 7 of the Code is, it could it be said that Order XXIII(1) is inapplicable. Secondly, could it not be said that it is not a case of a voluntary withdrawal by the applicant and the withdrawal of the application is declared by the Legislature, and therefore, Order XXIII(1) would not apply.

352Copy pinpoint352. Section 14 of the Limitation Act, 1963 reads as follows: “14.Exclusion of time of proceeding bona fide in court without jurisdiction. — (1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. (2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it. G (3) Notwithstanding anything contained in rule 2 of Order XXIII of the Code of Civil Procedure, 1908 (5 of 1908), the provisions of sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the court under rule 1 of that Order where such permission is granted on the ground that the first suit H

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A must fail by reason of a defect in the jurisdiction of the court or other cause of a like nature. Explanation.— For the purposes of this section,— (a) in excluding the time during which a former civil proceeding was pending, the day on which that proceeding was instituted and the day on which it ended shall both be counted; (b) a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding; (c) misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction.”

353Copy pinpoint353. A perusal of 14(1) shows that it is intended to exclude time in regard to a civil suit. Section 14(2) covers cases relating to the applications for which period of limitation is fixed. It contemplates that if such applicant comes to Court late with a time barred application but is able to show that he has been prosecuting with due diligence another civil proceeding, for the same relief, the period, when he was so prosecuting the other proceeding, can be excluded where the proceeding was prosecuted in good faith in a Court which from defect of jurisdiction or other cause of like nature is unable to entertain it. It will be noticed that sub-Section (3) of Section 14 deals only with the case falling under sub section (1). In E other words, it relates to civil suits. It enables a plaintiff in a subsequent suit to exclude the period which was consumed in prosecuting an earlier civil suit which latter suit stood withdrawn with permission granted by the Court. Therefore, in regard to applications, including applications under Article 137, it appears, the Law Giver has not contemplated F expressly excluding the time spent in pursuing another proceeding which stood withdrawn.

354Copy pinpoint354. In regard to power of withdrawal as already noticed Rule 8 of the Insolvency and Bankruptcy (Application of Adjudicating Authority Rule), 2016 reads as follows: G “Rule (8) withdrawal of application the adjudicating authority may permit withdrawal of the application may not Rule 4,6,7 as the case may be on a request made by the applicant before its admission.”

355Copy pinpoint355. The application made under Rule 4 is the application under H Section 7 by the financial creditor. However, rule 8 is silent as to any

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similar prohibition as is contained in Order XXIII(1)4(b). Unless the principle of Order XXIII Rule 1 which is based on public policy, is applied, a fresh application, compliant with the first two provisos in Section 7, may not be barred. In this regard, since under the Explanation in Section 7(1), default occurs when default qua any financial creditor is made out, the cause of action can become different, in which case, even the principle of Order XXIII Rule 1, may not apply.

356Copy pinpoint356. In this regard, since withdrawal is ordained by the third proviso, it would not be a withdrawal under Rule 8 on request. Secondly, even for the principle based on public policy to apply to a withdrawal under Rule 8, there must be a request and withdrawal. We do not pronounce on the effect of the same, viz., withdrawal on request. Suffice C it to conclude and hold that the withdrawal under the third proviso would not bar a fresh application by the same party after complying with the provision of the first or second proviso as the case may be on the same default.

357Copy pinpoint357. As far as Limitation is concerned, however, on the terms of D Section 14, since 14(1) read with 14(3), contemplates withdrawal of a suit with permission under Order XXIII Rule 1(4)(b) to enable exclusion of the period spent in a suit which is withdrawn and Section 14(2) is what applies to applications including one under, Article 137, the period spent in the application when it is withdrawn under the 3rd proviso cannot be excluded under Section 14 (3) of the Limitation Act. However, it may be open to point out that application is not being entertained within the meaning of Section 14(2) on account of the law that mandates its withdrawal on account of the non-compliance of conditions for maintaining the application it would be. However, we need not pronounce on it, as we feel that having regard to the Explanation in Section 7, it will always be open to the applicant to set up a different default to any financial creditor and move afresh. This unique feature of the Code is highly relevant in determining the validity of the Amendment. The application under Section 7 is not meant to be a recovery mechanism. The Code, as is clear from its title, deals with insolvency resolution, to begin with. If G there is insolvency, the application, with reference to any of the large number of creditors, suffices.

358Copy pinpoint358. Thus, withdrawal under the third proviso would not be bar a fresh application even on the same cause of action. It can, at any rate, be condoned under Section 5 of the Limitation Act. It is here we would H

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A also exercise our power under Article 142 to direct that if fresh applications are filed by the petitioners after complying with the first and second proviso, then on applications being filed under Section 5, of the Limitation Act, in regard to the period of pendency of applications, the authority shall condone the delay. As far as the period after the withdrawal under the proviso, in view of the power again under Section 5 of the B Limitation Act, certainly we see no reason as to why the periods spent cannot be explained in terms of B.K. Educational Services (P) Ltd. (supra). In the above manner, we would interpret the implications of withdrawal.

359Copy pinpoint359. We would consider the aspect of public interest, which can be gathered from the conditions obtaining, when the impugned amendment was made. Under the existing law, Section 7 of the Code permitted filing of applications by single applicants. It has been realised by the Legislature that there is dire need to condition the absolute right in respect of certain classes of financial creditors. We have already upheld the classification enacted in the first and the second provisos. From the standpoint of public interest, every application maintained by a single applicant, is perceived as a veritable threat to the fulfilment of the objectives of the Code. The continuance of the applications could not, therefore, be in public interest. It is, as if, the Legislature intended to apply its brakes in the form of asking the applicants to obtain the consensus of a minimum number of similar stakeholders, before the applications could be further processed.

360Copy pinpoint360. Let us consider the impugned proviso with a different wording. What, if the proviso provided for a longer period of time to comply with the requirement under the first and second provisos.? In F such a scenario, once the numerical strength, contained in the first and second provisos, in regard to the persons covered by the same, has been found to be valid by us, the blemish that would remain is, no doubt, the Legislature is interfering with the vested right, in the manner done under the provisos read together. That a vested right can be the subject G matter of retrospective law, cannot be doubted. Since, the law made, under the Constitution, must pass muster, under Articles 14, 19, 21 and 300A of the Constitution, the issue really boils down to, whether or not, it is manifestly arbitrary. The further question would arise, under Article 19, as to whether, the law would amount to a reasonable restriction of the Right under Article 19(1)(g). The Doctrine of Fairness, indeed, has H

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been present in the mind of the courts, whenever a law, described as retrospective, comes up for interpretation with or without a challenge to the law. In the context of a challenge, on the ground of manifest arbitrariness, the test to be applied has been articulated as to whether it is capricious, irrational, does not disclose any principle, betrays absence of proportionality or whether it is excessive. We must also not lose sight of the fact that the law in question is an economic measure. This is a case where the Law Giver has not left anything to speculation or doubt. We have already indicated about the effect of the proviso mandating the compulsory withdrawal of the application. We are of the view that this is a case, where the law, in question, is retrospective, in that, contrary to the requirement in the law, at the time, when the application was filed, C a new requirement is placed, even though, it is sought to be done by superimposing this condition, not at the time, when the application was filed, which really is the relevant time to determine the question of maintainability of the application, with reference to what the law provided in regard to who can move the application but at the stage of the new law.

361Copy pinpoint361. However, we cannot also lose sight of the fact that the Legislature has power to impair and take away vested rights. The limitation that flows, however, is from both Article 14 and 19 read with Article 21. It flows from the Doctrine that the action of the State must be fair and reasonable. The question, as to validity of the retrospective law, is a matter to be judged on a consideration of the facts, the period of time, over which the retrospective law operates, the impact of the law on the vested rights, the public interest, the nature of the right, which is the subject matter of the law and the terms of the law.

362Copy pinpoint362. The nature of the right involved in this case, is the right of the financial creditors to move an application under Section 7. Though, Section 7 confers a right upon the financial creditor to file the application, the proceedings are one in rem. We have already dealt with the scope of the Code and the consequences it can produce on the stakeholders and also the real estate project. The Legislature was faced with the situation, where it felt that the requirement, as to maintainability of the application under Section 7, must, in regard to pending applications, be modified in the manner done. There is a determining principle, namely, the perception from experience about how the entire object of the Code would stand jeopardised if applications already filed could go on even when a fair H

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A and reasonable number of kindred souls are not available to support it. Once there is a principle, it cannot be capricious, excessive or disproportionate unless we find the time given under the proviso is manifestly arbitrary. A vested right under a statute can be taken away by a retrospective law. A right given under a statute can be taken away by another statute. We cannot ignore the fact that there was considerable B public interest behind such a law. The sheer numbers, in which applications proliferated, combined with the results it could produce, cannot be brushed aside as an irrational or capricious aspect to have been guided by in making the law. Being an economic measure, the wider latitude available to the Law Giver, cannot be lost sight of.

363Copy pinpoint363. The issue, which, however remains, is the period of 30 days made available. Is it reasonable to expect that a single applicant could, under the aegis of the laws’ collect information, and furthermore, gather the support of fellow travellers, also inclined to support the applicant, as required? The third proviso does not provide for the applicant applying before the Tribunal and seeking extension of the period. It could be also argued that by granting such extensions, no harm is caused to the stakeholders, insofar as, all this is done before the admission of the application, with which alone, the consequences, including the appointment of the Interim Resolution Professional and the passing of an Order of Moratorium, would arise. But here again we would be foraying into areas of legislative value judgement and be proceeding on the basis of what would be a fairer law.

364Copy pinpoint364. We have to take the law, therefore, as it is and deal with it on the touchstone of, whether the law is manifestly arbitrary. We have already, no doubt, found that by virtue of the statutory mechanism, there appears to be an information grid available under the law. Undoubtedly, we would have felt more reassured, if the period had been longer than it is. The law came as a bolt from the blue as it were.

365Copy pinpoint365. As regards the compelled withdrawal under the third proviso of the pending applications is concerned, we hold as follows. Once the G Legislature intended that the pending applications must be made compliant with the threshold requirement, consequences for not doing so had to be provided. Otherwise, it would have created complete uncertainty and the applicant would have been dealt with in a manifestly arbitrary manner. Providing for the consequence of withdrawal before admission, which H we have explained, does not have the consequence of preventing the

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fresh filing, even in regard to the same default, after complying, no doubt, with the requirement of the first or the second proviso, cannot be dubbed as arbitrary. No doubt, there is lack of clarity in this regard in the provision but on an understanding of the law, as we have expounded, the provision was capable of being understood in the manner done.

366Copy pinpoint366. In regard to the first and the second provisos, they have only prospective operation. The creditors covered by these provisos, are not subjected to any time limit (except, no doubt, the bar under Article 137 of the Limitation Act), in the matter of garnering the requisite support. However, prescribing a time limit in regard to pending applications, cannot be, per se, described as arbitrary, as otherwise, it would be an endless and uncertain procedure. The applications would remain part of the docket and also become a Damocles Sword overhanging the debtor and the other stakeholders with deleterious consequences also qua the objects of the Code.

367Copy pinpoint367. Finally, the actual time provided. Is it manifestly unfair? Would not six weeks, two months or even more lengthier periods, be more fair? D Undoubtedly, it would be, from the point of view of the applicants. Another way to approach the problem is, was it impossible for the creditor/creditors to seek information, get into touch with the other creditors and persuade them to join him/them. As far as court fees is concerned, there is no extra liability as the amount remains the same, viz., Rs.25,000/-, E irrespective of the number of applicants. If the condition in the third proviso was impossible to comply with, then, it would also be manifestly arbitrary. As far as availability of information is concerned, be it the mechanism of an Association of Allottees contemplated under the RERA or the requirement under the said Act to post details of the allotment, at least, in law, the Legislature was not making a capricious command. So F also, is the case with the creditors covered by the first proviso, having regard to the clear requirement of Section 88 of the Companies Act,

2013. There are registers, which can be perused and information gathered.

368Copy pinpoint368. Another aspect of the matter is, if there is insolvency and it G affects creditors, ordinarily, self-interest would guide them into following the best course available to them. We have also seen the presence of plural remedies. No doubt, calculation of one-tenth in a case, may, undoubtedly, require the quantification of total number of creditors. This H

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A would be necessary, no doubt, only if hundred creditors cannot be found to support the application.

369Copy pinpoint369. We have noted the consequences of the deemed withdrawal, the nature of the right, the Explanation to Section 7, the objects of the Code, the factual matrix reflecting a ten-fold increase in the applications, the pressure on the dockets of the bodies, which are charged with the imperative duty to deal with matters with the highest speed, the impact on similar stakeholders in the category and the sheer largeness of the class of creditors. The period could have been more fair to the petitioners by being longer but that is where we must bear in mind, the limits of our jurisdiction. Where would the Court draw the line? We find it difficult to hold that within the time limit of 30 days it is impossible to comply with the requirements.

370Copy pinpoint370. We have dealt with the aspect relating to the impact of the statutory withdrawal of the application. Secondly, we must also bear in mind that the Code was enacted in the year 2016. The period of the retrospective operation, would appear to be, spread over for a period of two years and for the most part, it relates to a period of one year. We have already found that the withdrawal under the third proviso, will not stand in the way of the applicant, invoking the same default and filing the application and even the principle of Order XXIII Rule 1 of the CPC will not apply and will not bar such application. As far as limitation is concerned, we have explained as to what is to be the impact. The nature of the vested right and the impact of the law, the public interest, the sublime objects, which would be fulfilled, would, in the facts of this case, constrain us from interfering, even though, this Court may have a different view about the period of time, which is allowed to the applicant. F

371Copy pinpoint371. Lastly, there remains a question of court fees. As far as court fees is concerned, it is true that in the circumstances of the case, there is compelled withdrawal of the applications. The other side of the picture is, even, according to the petitioners, the applications engaged the Adjudicating Authority and time was spent on the applications. In the circumstances of these cases, we would resort to our power under Article 142 of the Constitution to order as follows. We would direct that in case applications are moved by the applicants, who are petitioner before us, in regard to the very same corporate debtor, in the same real estate project, as far as allottees are concerned, the applicants shall be exempted from the requirement of paying court fee. This would obviously be a