Tribunal contempt jurisdiction under insolvency law bars parallel High Court contempt proceedings over consent terms

Section 425 of the Companies Act, 2013 was treated as the source of contempt power for the NCLT and NCLAT, and read with Sections 408 and 424(3), Section 60(5) of the Insolvency and Bankruptcy Code, 2016, and Rule 11 of the NCLT Rules, the statutory scheme was held to give the Tribunal effective authority over matters before it, including insolvency proceedings. On that basis, the High Court's parallel contempt jurisdiction under Section 10 of the Contempt of Courts Act, 1971 was unavailable where the Tribunal itself had been vested with contempt powers. The Court also noted that contempt cannot be used as a substitute for execution or for resolving disputed issues arising from consent terms. The contempt petition was dismissed as not maintainable before the High Court.

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Issues: Whether a contempt petition before the High Court was maintainable for alleged non-compliance of consent terms recorded by the National Company Law Tribunal in insolvency proceedings under the Insolvency and Bankruptcy Code, 2016, or whether the Tribunal itself had exclusive contempt jurisdiction.

Analysis: Section 425 of the Companies Act, 2013 was treated as the governing source of contempt power for the National Company Law Tribunal and the Appellate Tribunal. The provision was read as conferring the same contempt jurisdiction, powers and authority as a High Court, without limiting that power to proceedings under the Companies Act alone. The statutory scheme was read harmoniously with Section 408 and Section 424(3) of the Companies Act, 2013, Section 60(5) of the Insolvency and Bankruptcy Code, 2016, and Rule 11 of the National Company Law Tribunal Rules, 2016, to conclude that the Tribunal is a single adjudicatory institution with effective authority over matters before it, including insolvency matters. The High Court's contempt jurisdiction under Section 10 of the Contempt of Courts Act, 1971 was held not to be available in parallel where the statute has itself vested contempt power in the Tribunal. The Court also noted that contempt cannot be used as a substitute for execution or for resolving disputed questions arising out of consent terms.

Conclusion: The contempt petition was not maintainable before the High Court and was dismissed.

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