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TaxTMI 
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2025 (12) TMI 110
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.... of the order that was passed on merits on 24.03.2025. The said application for recall of the order 24.03.2025 has been dismissed, holding thereof that the recall will not lie, because for the purposes of preference of a recall application, exercising of an inherent power under Rule 11 of NCLT Rules, would not be open to be resorted to by a party, who had admittedly already been a party to the proceedings and had contested on merits and lost. Having not questioned the propriety of the principal order, the preference of a recall application cannot be taken as to be a substitute to seek a review of the order that, was passed on merits, which otherwise, under the provisions of the I & B Code, to be read with the NCLT Rules, is not a scope left open for reviewing of an order which has been admittedly passed on merits. Rule 11 as incorporated is in the shape of the savings clause, where the exercise of inherent powers is an exclusive prerogative vested with the Learned Tribunal, which has given an overriding effect to the other provisions, for the purposes of extension or exercise of powers by the Learned Tribunal to pass any such order, as may be necessary to meet the ends of Justice d....
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....Digital (India) Pvt. Ltd. v. Nirmal Trading Company (Company Appeal (AT) (Insolvency) No.504 of 2022), the Hon'ble NCLAT held that the Adjudicating Authority (NCLT), is vested with power to recall its order in terms of Rule 11 of NCLT Rules, 2016. However, this power does not include within its ambit, the power to review its order after a substantial issue in the matter has been decided. The relevant paragraphs is extracted hereunder, "No doubt that the Adjudicating Authority has no jurisdiction to review its order after deciding a substantial issue but it has the jurisdiction to recall the order of the kind in dispute i.e. where the right to Reply was closed by an order on the ground that the opportunities granted were not availed. In this regard, we rely upon a decision of this Tribunal rendered in the case of CA (AT) (Ins) No. 271 of 2022 in which it has been held that if there is an adjudication by the Adjudicating Authority on merits of the issues then it would not have the jurisdiction to review its order but insofar as the dispute with regard to right to file the Reply which is closed by an order, it certainly has the jurisdiction to recall it in terms of the Rule 1....
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....on MA No.554/2019. The prayer made by the Appellant in the recall application, thus preferred by the Applicant, has been that the order dated 24.03.2025, which was rendered on Interlocutory Applications being IA(IBC)/2067(CHE)/2024, IA(IBC)/2069(CHE)/2024, IA(IBC)/2081(CHE)/2024, IA(IBC)/2106(CHE)/2024, IA(IBC)/2239(CHE)/2024 & IA(IBC)/2242(CHE)/2024, may be recalled and the applications may be restored to its original number to be reheard. In the said order, Learned NCLT, after observing that the respective apartments for which the applicants were seeking registration of sale deed relate to the project other than the Matrix, that the Resolution Professional has admitted the claim, that as per approved resolution plan, receivables are nil and that the Applicant allottees were willing to remit the Incremental Demand Payable under the plan, and that since the plan in the instant case has been approved, the same is to be implemented, proceeded to deciding the aforesaid Interlocutory Applications and issued the following directions: "Let the Applicant(s) pay the amount. The Respondent/Successful Resolution Applicant is directed to act as per the approved plan". 8. If the re....
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....ch is not even the case of Appellant, and having voluntarily participated in the proceedings that were held on 24.03.2025 in continuation to the order of the approval of the Resolution Plan dated 13.12.2019, as rendered in MA No.554/2019, the order dated 24.03.2025, would have to be treated to be an order passed on merits after participation of the Appellant in the proceedings. 10. The Hon'ble NCLAT in the case of Aircastle (Ireland) Ltd. v. Mr. Ashish Chawchharia, RP of Jet Airways (India) Ltd. and Ors. (Comp. App. (AT) (Ins) No.1178/2024) has further emphasised on the difference between 'review' and 'recall'. It was made clear that the power to recall can be exercised only on account of a procedural error apparent on the face of record such as the mistake of the court prejudicing the parties, fraud or collusion in obtaining the judgment or a judgment that was rendered in ignorance of the fact that a necessary party had not been served at all or had died and the estate was not represented, and that powers vested on this Tribunal under Rule 11 of NCLT Rules, 2016, must not be invoked to re-open the case and to re-examine the findings. The relevant paragraphs are extracted hereun....
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....ule cannot be invoked to revisit the findings and it is not open to re-examine the findings. The mistake/error must be apparent on the face of the record and must have occurred due to oversight, inadvertence or human error. It would be open to correct the conclusion if the same is not compatible with the finding recorded on the issues raised". 11. This Tribunal refers to the decision of the five-member bench of the Principal Bench of the Hon'ble NCLAT in the case of Union Bank of India v. Dinkar T. Venkatasubramanian and Ors (I.A. No.3961 of 2022 in Company Appeal (AT) (Ins.) No.729 of 2020) wherein the Appellate Tribunal, while deciding on the question, whether it was vested with the power to entertain an application for recall of judgment on sufficient ground, elaborated on the difference between 'review' and 'recall'. While doing so, it has held that power of recall on sufficient grounds is an inherent power vested with the Appellate Tribunal under Rule 11 of NCLT Rules, 2016 and has to be exercised to rectify any procedural error committed by it and that the power of review has not been vested upon the Appellate Tribunal. It was clarified that the power of recall of the Appe....
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..... The power to review on the case on merits is not considered to be an inherent power of the Tribunal. It can be seen that, in essence, the power of procedural review is nothing but the power of the Tribunal to recall its order. The relevant paragraphs of the judgment are extracted as under, "44. In Grindlays Bank Ltd. vs. Central Govt. Industrial Tribunal a question arose whether Central Government Industrial Tribunal has power to recall/set aside an ex parte award when the party aggrieved had been prevented from appearing by a sufficient cause. Holding that such powers inheres in a Tribunal, this Court observed: "6. We are of the opinion that the Tribunal had the power to pass the impugned order if it thought fit in the interest of justice. It is true that there is no express provision in the Act or the rules framed thereunder giving the Tribunal jurisdiction to do so. But it is a well- known rule of statutory construction that a Tribunal or body should be considered to be endowed with such ancillary or incidental powers as are necessary to discharge its functions effectively for the purpose of doing justice between the parties. In a case of this nature, we are ....
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....di alteram partem rule of natural justice. The power of recall is different from the power of altering/reviewing the judgment. However, the party seeking recall/alteration has to establish that it was not at fault." 15. In the case of Greater Noida Industrial Development Authority (supra), it was held that an application for recalling the order of NCLT approving the resolution plan of the Corporate Debtor is maintainable if the same is made on the ground of non-adherence to provisions of IBC, 2016 and misrepresentation of facts by the Resolution Professional before the Tribunal. It was emphasized that such power to recall must be exercised sparingly and must not be a ground to rehear the case. The relevant paragraph is extracted for reference, "50. In light of the discussion above, what emerges is, a Court or a Tribunal, in absence of any provision to the contrary, has inherent power to recall an order to secure the ends of justice and/or to prevent abuse of process of the Court. Neither the IBC nor the Regulations framed thereunder, in any way, prohibit, exercise of such inherent power. Rather, Section 60(5)(c) of the IBC, which opens with a non-obstante claus....