NCLT President’s Authority to Transfer Cases Affirmed by NCLAT
In a significant ruling, the National Company Law Appellate Tribunal (NCLAT) has confirmed that the President of the National Company Law Tribunal (NCLT) holds the authority to transfer cases across different benches, irrespective of territorial jurisdictions. This decision was delivered on Wednesday in the case of Kamalesh v. Praveen.
The NCLAT’s three-member bench, consisting of Judicial Member Justice Sharad Kumar Sharma and Technical Members Arun Baroka and Indevar Pandey, clarified that the NCLT President has the discretion to relocate proceedings from one bench to another as required by the Insolvency and Bankruptcy Code (IBC). The Appellate Tribunal stated, “The power of the NCLT President is not limited or confined to any territorial location.”
This ruling arose from insolvency proceedings against Kamlesh Rani Singla, a suspended director and personal guarantor of Laxmi Pipes Limited. While the corporate insolvency resolution process (CIRP) concerning Laxmi Pipes was already underway at the NCLT Chandigarh, separate proceedings under Section 95 of the IBC were initiated against Singla at NCLT New Delhi. Singla requested that her personal guarantor proceedings be transferred to Chandigarh.
However, her request was denied by the NCLT President in December 2025, referencing an earlier judgment by the Gujarat High Court in Arcelor Mittal Nippon Steel India Limited v. National Company Law Tribunal & Ors. The High Court had maintained that Rule 16(d) of the NCLT Rules restricted the President’s authority to transfer cases beyond the territorial jurisdiction of a specific bench, suggesting that the President’s power was limited to benches within the same territorial area. This interpretation is currently being challenged in the Supreme Court.
Contrary to the High Court’s view, the NCLAT interpreted Rule 16(d) along with Section 60(2) of the IBC and Rule 2(7) of the NCLT Rules, affirming that the President has adequate authority to transfer cases between benches. The Tribunal emphasized that limiting the President’s power to a single territorial jurisdiction could lead to anomalous situations.
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The NCLAT further highlighted that Section 60(2) of the IBC mandates insolvency proceedings against a personal guarantor to be initiated at the same NCLT where the CIRP or liquidation of the corporate debtor is pending. This provision was designed to consolidate proceedings and prevent contradictory rulings.
In this particular case, the Tribunal determined that NCLT New Delhi lacked both territorial and inherent jurisdiction to continue the Section 95 proceedings against Singla. It ruled that the personal guarantor proceedings should have been rejected as non-maintainable at the admission stage, directing the creditor to approach NCLT Chandigarh instead.
Accordingly, the NCLAT overturned the NCLT President’s order and annulled the proceedings pending at NCLT New Delhi. The creditor was granted permission to initiate proceedings at the NCLT with appropriate jurisdiction.
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The legal representation for the appellant was provided by advocates Pankaj Garg and Yaksh Garg, while Resolution Professional Gautam Singhal was represented by advocate Rajat Chaudhary.
