Centre Seeks Supreme Court Intervention on NCLT Case Transfer Powers
The Indian government has approached the Supreme Court, challenging a recent Gujarat High Court decision that limits the National Company Law Tribunal (NCLT) President’s powers in transferring cases across different benches.
The dispute arose from a ruling in the case of Union of India Vs ArcelorMittal Nippon Steel India, where the Gujarat High Court concluded that the NCLT President cannot transfer cases administratively beyond the territorial jurisdiction of a particular bench. This decision was made after the NCLT President had moved cases involving ArcelorMittal from the NCLT Ahmedabad to the NCLT Mumbai.
A Supreme Court bench, consisting of Chief Justice of India Surya Kant and Justice V Mohana, has issued a notice seeking a response from ArcelorMittal Nippon Steel India Private Limited, previously known as Essar Steel India Limited.
Legal Framework and Interpretations
The core of the disagreement lies in the interpretation of Rule 16(d) of the NCLT Rules, 2016. This rule authorizes the NCLT President to transfer cases between benches “when the circumstances so warrant.” The Gujarat High Court’s interpretation was that this power does not extend beyond a bench’s territorial jurisdiction, effectively annulling the administrative orders for the transfer of ArcelorMittal’s cases to Mumbai.
The Union government argues that this interpretation introduces a territorial restriction not present in Rule 16(d). It contends that the NCLT is a singular tribunal serving the entire nation, with its benches established for administrative convenience, rather than to enforce geographical boundaries.
More Read
Practical Implications and Government’s Stand
The government’s plea emphasizes the practical necessities prompting the transfers, highlighting that two benches in Ahmedabad had recused themselves from hearing the cases. The Centre maintains that administrative transfers are essential to ensure the tribunal’s functionality and to prevent a judicial vacuum.
Furthermore, the plea warns that upholding the High Court’s decision could paralyze proceedings if simultaneous recusals or vacancies occur at a particular bench.
Background and Legal Proceedings
The issue arose from a recusal by an NCLT Ahmedabad bench on January 9, 2024, followed by another recusal in April of the same year. Subsequently, the NCLT President transferred the cases to Mumbai on June 6, 2024, and February 10, 2025. ArcelorMittal contested these orders, leading to Justice Niral R Mehta’s decision to quash the recusal and transfer orders, citing a lack of administrative power to modify territorial jurisdiction.
More Read
In February 2026, the Gujarat High Court’s Division Bench instructed the Centre to file an appeal with the Supreme Court, as a similar matter was under review by the apex court. The Union of India has since escalated the matter to the Supreme Court, where a related issue was already being examined following a petition by Anita Rayapatti against the same High Court order.
ArcelorMittal Nippon Steel is represented by Advocate Ruby Singh Ahuja, Senior Partner at Karanjawala & Co.
