2022 (10) TMI 48 - SC - Insolvency and Bankruptcy

Supreme Court clarifies NCLAT's jurisdiction on retained appeals post-set aside main proceedings.

The Supreme Court addressed jurisdictional issues regarding the NCLAT's retention of an appeal despite the main proceedings being set aside. The Court ... Prematurity of appeal - leave to withdraw appeal - jurisdiction of appellate tribunal to retain appeal pending decision on withdrawal application - intervenors' remedy before the appellate tribunal - direction for expeditious disposal of pending applicationPrematurity of appeal - jurisdiction of appellate tribunal to retain appeal pending decision on withdrawal application - Whether this Court should entertain the appeal when the NCLAT has not yet decided the application for leave to withdraw the appeal. - HELD THAT: - The Court declined to entertain the appeal as premature because the NCLAT has a pending application filed by the appellant seeking leave to withdraw the appeal. The Supreme Court observed that the NCLAT must first determine whether the proceedings before the NCLT have in fact come to an end in view of the earlier order of this Court, and only thereafter decide the fate of the appeal. Given that the NCLAT has not decided the withdrawal application, the appellate proceedings before this Court are not ripe for consideration and therefore the appeal will not be entertained at this stage.Appeal not entertained as premature; Supreme Court declined to adjudicate while the NCLAT's application for leave to withdraw remains pending.Leave to withdraw appeal - direction for expeditious disposal of pending application - intervenors' remedy before the appellate tribunal - Whether intervenors' applications before this Court should be entertained and what direction should be given to the NCLAT regarding the pending withdrawal application. - HELD THAT: - The Court refused to entertain the applications filed by intervenors before the Supreme Court because those intervenors have already filed applications before the NCLAT. The Court noted that if the appellant's prayer to withdraw the appeal is allowed by the NCLAT, the intervenors will have to pursue their remedies in accordance with law before the appropriate forum. In view of the delay since the last NCLAT order dated 15.04.2019, the Supreme Court directed the NCLAT to decide the pending application seeking withdrawal of the appeal expeditiously, specifically within six weeks from the date of the Supreme Court's order.Intervenors' applications before the Supreme Court not entertained; NCLAT directed to dispose of the application for leave to withdraw the appeal within six weeks.Final Conclusion: The Supreme Court dismissed the present petitions without adjudicating the merits as premature, refused to entertain intervenors' applications, and directed the NCLAT to decide the appellant's pending application for leave to withdraw the appeal expeditiously within six weeks; the appeals are disposed of accordingly. Issues:1. Jurisdiction of NCLAT to retain appeal despite main proceedings being set aside by the Supreme Court.2. Entertaining applications by intervenors before the Supreme Court.3. Timely disposal of application seeking withdrawal of appeal by NCLAT.Analysis:1. The appellant challenged interim orders in Company Appeal (AT) (Insolvency) No.107 of 2019 before the NCLAT. The Supreme Court noted that the NCLAT was retaining the appeal despite the main proceedings being set aside by the Supreme Court. The appellant argued that the NCLAT lacked jurisdiction at this stage. The Supreme Court acknowledged the contention but deemed the appeal premature as the NCLAT had not yet decided the application to withdraw the appeal. The Court directed the NCLAT to determine if the NCLT proceedings had concluded due to the Supreme Court's order before taking further action.2. The Supreme Court also addressed applications by intervenors, stating that such applications should be pursued before the NCLAT. If the appellant's request to withdraw the appeal was granted, the intervenors would need to seek remedies as per the law. The Court declined to entertain the intervenors' applications at that stage.3. Emphasizing the need for timely resolution, the Supreme Court urged the NCLAT to promptly dispose of the application seeking withdrawal of the appeal within six weeks from the date of the judgment. The Court highlighted that a considerable amount of time had passed since the last order in the appeal before the NCLAT, underscoring the importance of expeditious resolution. The Supreme Court concluded the judgment with these directives, disposing of the appeals based on the outlined observations.