Safiya Malik

The Delhi High Court has transferred a winding-up petition filed against Pinnacle Air Pvt. Ltd. to the National Company Law Tribunal (NCLT), Delhi Bench. The court ruled that under Section 434 of the Companies Act, 2013, proceedings for the winding up of companies pending before High Courts must be transferred to the NCLT unless irreversible steps have been taken. The court found that no substantive progress had been made in the present case, and therefore, the petition was liable to be transferred.

The case arose from a winding-up petition filed by COWI India Pvt. Ltd. under Sections 433(e), 434(1)(a), and 439 of the Companies Act, 1956, seeking the liquidation of Pinnacle Air Pvt. Ltd. for its alleged inability to pay outstanding dues. The petition, filed in 2016, had remained pending before the High Court for several years without any significant orders. The respondent company, Pinnacle Air, moved to transfer the matter to NCLT in line with the Companies Act, 2013, which mandates such transfers.

The petitioner opposed the transfer, arguing that no formal application for transfer had been filed and relied on the Calcutta High Court’s decision in Abhijeet Projects Ltd. v. Yogesh Khanna, which held that a winding-up petition cannot be transferred to the NCLT suo motu unless a formal application is made. The petitioner submitted that in the absence of such an application, the matter should continue before the High Court.

The respondent, Pinnacle Air, contended that there was no legal restriction preventing the High Court from transferring the matter to NCLT even in the absence of a formal application. It relied on the Delhi High Court’s judgment in Gurbakhsh Singh BA, Builders P. Ltd. v. Fortis Hospital Ltd., which held that a winding-up petition can be transferred at any stage unless irreversible steps have been taken. The respondent submitted that no official liquidator had been appointed, no orders had been passed for the sale of assets, and no irreversible actions had been taken in the present case.

The court examined the provisions of Section 434 of the Companies Act, 2013, which states that pending winding-up proceedings before High Courts must be transferred to NCLT unless the process has reached an advanced and irreversible stage. The court observed that "the present winding-up petition is a non-starter. The proceedings remain at a preliminary stage, with neither a provisional liquidator nor an official liquidator having been appointed to assume control over the assets and affairs of the respondent company."

The court referred to the Supreme Court’s decision in Action Ispat and Power P. Ltd. v. Shyam Metalics and Energy Ltd., which held that winding-up proceedings pending before High Courts should be transferred to NCLT unless they have progressed to an advanced stage. The court recorded that "given the scheme of winding up under Chapter XX of the Companies Act, 2013, it is clear that several stages are contemplated, with the Tribunal retaining the power to control the proceedings in a winding-up petition even after it is admitted."

The court also considered the judgment in Gurbakhsh Singh BA, Builders P. Ltd. v. Fortis Hospital Ltd., where the Delhi High Court clarified that winding-up petitions may be transferred post-admission as long as no irreversible steps have been taken. The court recorded that "a decision to transfer the matter to the National Company Law Tribunal is a matter of jurisdiction of the court, which transfer can be effected suo motu by this court and mere moving or non-moving of an application by any of the parties seeking such transfer, will not be decisive."

The petitioner’s reliance on Abhijeet Projects Ltd. v. Yogesh Khanna was examined, where the Calcutta High Court had set aside suo motu transfers of winding-up proceedings. The Delhi High Court distinguished that case, noting that in the present matter, the respondent had explicitly sought the transfer through written submissions, even if a formal application had not been filed. The court held that "where parties explicitly seek transfer or indicate their consent, the absence of a formal application should not be an impediment, as the transfer serves the broader objective of streamlining insolvency resolution under the IBC framework."

The High Court issued the following directives:

• The winding-up petition is transferred to the NCLT, Delhi Bench, for further proceedings.

• The electronic record of the petition is to be transmitted to the NCLT within one week.

• The matter is listed before the NCLT on March 10, 2025, with all parties directed to appear before the tribunal on that date.

• Interim orders, if any, shall continue until the first hearing before NCLT.

The court disposed of the petition and all pending applications accordingly.

Case Title: COWI India Pvt. Ltd. v. Pinnacle Air Pvt. Ltd.
Case Number: CO.PET. 193/2016
Bench: Justice Amit Mahajan

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