2020 (6) TMI 344 - HC - Companies Law

Maintainability of application before NCLT - Notification dated 24.3.2020 issued by the Ministry of Corporate Affairs, New Delhi - default in the present case was below rupees one Crore - HELD THAT - This issue has not been discussed by the National Company Law Tribunal at all. The petitioner is therefore permitted to approach against the said order dated 5.5.2020 passed by the National Company Law Tribunal before the National Company Law Appellate Tribunal, or file a review application before the NCLT itself. We are not inclined to entertain the present civil revision petition and we leave it free for the petitioner to approach the National Company Law Tribunal itself or the Appellate Tribunal, as the case may be, for raising the said issue. The amendment Notification dated 24.3.2020 depends upon the facts of the case and unless this issue is first adjudicated by the Tribunal below, this court cannot decide such abstract questions in writ jurisdiction. The present civil revision petition is not maintainable at this stage - Petition dismissed.

Summary

Issues:
1. Maintainability of the civil revision petition against the order of the National Company Law Tribunal.
2. Interpretation of the Notification dated 24.3.2020 specifying the minimum default amount under the Insolvency and Bankruptcy Code, 2016.

Analysis:
1. The petitioner, a Corporate Debtor, challenged the order of the National Company Law Tribunal, Chennai Bench, dated 05.05.2020, which admitted a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016. The petitioner argued that the Notification dated 24.3.2020, setting one Crore rupees as the minimum default amount, should have been considered by the Tribunal. The High Court noted that the Tribunal did not address this issue. Consequently, the petitioner was granted the liberty to appeal the order before the National Company Law Appellate Tribunal or file a review application before the NCLT itself.

2. The High Court declined to entertain the civil revision petition, emphasizing that the issue regarding the impact of the Notification dated 24.3.2020 on the present case should be first adjudicated by the Tribunal. The Court stated that abstract questions cannot be decided in writ jurisdiction without the Tribunal's consideration. Therefore, the petition was dismissed with the petitioner having the freedom to raise the issue before the appropriate Tribunal. The Court highlighted the dependency of the amendment Notification on the case's facts, indicating the need for a thorough examination at the lower level before a decision at the High Court level.

In conclusion, the High Court's judgment focused on the maintainability of the civil revision petition against the NCLT's order and the necessity for the Tribunal to address the impact of the Notification specifying the minimum default amount. The Court allowed the petitioner to pursue remedies before the relevant Tribunals, highlighting the importance of factual adjudication before abstract legal questions can be decided at the higher court level.