High Court Jurisdiction Under Article 227 Ousted Regarding Expedited Disposal of Matters Pending Before NCLAT

The Petitioner, former Managing Director of M/s. Shree Vaishnodevi Mills Pvt. Ltd., filed a Civil Revision Petition under Article 227 of the Constitution of India.

The Petitioner sought a direction from the High Court to the National Company Law Appellate Tribunal (NCLAT), Chennai, to expeditiously dispose of an appeal (Company App (AT)(CH) (INS) No. 444 of 2024).

The Petitioner argued that because Section 62 of the Insolvency and Bankruptcy Code (IBC) only allows appeals to the Supreme Court on questions of law from final orders, a revision petition under Article 227 was the only remedy against routine adjournments granted by the NCLAT.

1. Whether the High Court should exercise its supervisory jurisdiction under Article 227 to direct the NCLAT to dispose of a pending appeal within a specific time frame.

2. Whether the statutory framework of the IBC ousts or limits the High Court's intervention in NCLAT proceedings.

The court applied Section 62 of the IBC, 2016, which mandates that appeals against NCLAT orders lie exclusively with the Supreme Court on questions of law.

It also considered Section 64 of the IBC, which emphasizes the expeditious disposal of applications by the Adjudicating Authority and the Appellate Tribunal.

Furthermore, the court relied on the principle of judicial restraint, holding that High Courts should not routinely interfere with the board management or internal procedures of specialized Tribunals like the NCLAT.

The Court observed that Section 62 of the IBC effectively ousts the High Court’s jurisdiction to entertain revisions against NCLAT orders.

While the Petitioner argued that Article 227 was necessary to address delays, the Court reasoned that issuing routine directions for "speedy disposal" does not serve the cause of justice and may cause practical inconvenience to the Tribunal’s existing board.

The Court emphasized that Tribunals must regulate their own proceedings systematically.

It held that directions for urgency should only be given in exceptional circumstances with recorded reasons, taking into account the Tribunal's workload and the conduct of the parties.

The Court concluded that since Section 64 of the IBC already provides for expeditious disposal, the proper remedy is for the party to file an application before the NCLAT itself, explaining the reasons for urgency.

The Court granted liberty to the Petitioner to approach the NCLAT with a formal request for speedy disposal substantiated by adequate reasons.

No costs were ordered.