Insolvency withdrawal must follow the prescribed statutory route; inherent powers cannot bypass Section 12A and Regulation 30A.

Where the Insolvency and Bankruptcy Code and Regulation 30A prescribe a specific procedure for withdrawal of an admitted insolvency petition, the NCLT's inherent powers under Rule 11 cannot be used to bypass that route. The Tribunal noted that earlier authorities permitting recourse to inherent powers were confined to situations where the Committee of Creditors had not yet been constituted and no specific withdrawal mechanism applied. As Regulation 30A now governs withdrawal both before and after constitution of the Committee of Creditors, the application for withdrawal based on settlement was not maintainable under Rule 11, and the parties had to proceed under the prescribed insolvency withdrawal framework.

---

---

Issues: Whether Rule 11 of the NCLT Rules, 2016 could be invoked for withdrawal of the company petition when a specific statutory procedure for withdrawal existed under Section 12A of the Insolvency and Bankruptcy Code, 2016 and Regulation 30A of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

Analysis: The application sought withdrawal of the admitted insolvency petition on the basis of settlement between the parties. The Tribunal noted that the Supreme Court authorities relied upon by the applicants recognised recourse to the NCLT's inherent powers under Rule 11 only where the Committee of Creditors had not yet been constituted and where no specific procedure governed the situation. It further observed that Regulation 30A, as substituted, specifically provides the manner for withdrawal both before and after constitution of the Committee of Creditors, and that the later decisions emphasise adherence to the prescribed withdrawal mechanism and discourage bypassing it through inherent powers. In these circumstances, the existence of a specific statutory route under Section 12A and Regulation 30A excluded invocation of Rule 11.

Conclusion: Rule 11 of the NCLT Rules, 2016 could not be invoked in the present case for withdrawal of the company petition.

Final Conclusion: The request for withdrawal under inherent powers was not maintainable, and the applicants were left to pursue the remedy available under the prescribed insolvency withdrawal procedure.

Ratio Decidendi: Where the Insolvency and Bankruptcy Code and the applicable regulations prescribe a specific procedure for withdrawal of an admitted insolvency petition, the NCLT's inherent powers under Rule 11 cannot be used to bypass that procedure.

---