NCLAT: Orders Passed by NCLT President on Listed Transfer Applications Are Judicial, Appealable Under Companies Act
Pranav B Prem
The National Company Law Appellate Tribunal (NCLAT), New Delhi, has held that any order passed by the President of the National Company Law Tribunal (NCLT) on a transfer application listed before the Court assumes the character of a judicial order, even if the President otherwise discharges administrative functions. The bench comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) further clarified that such an order is appealable under Section 421 of the Companies Act, 2013, and not under Section 61 of the Insolvency and Bankruptcy Code (IBC).
The present appeals were filed challenging the orders dated 10.07.2025 and 12.07.2025, passed by the NCLT President in Transfer Application No. 37 of 2025 and connected proceedings. The appellants contended that the President, in his administrative capacity, had no authority to pass any kind of interim relief or binding direction in the context of a transfer application, especially without demonstrating any prejudice caused to the applicant.
The appellants took particular objection to the manner in which the order was passed—allegedly during the lunch hour—claiming it contravened Rule 9 of the NCLT Rules, 2016, which governs court timings. It was argued that listing the transfer application during lunch and proceeding with it resulted in procedural irregularity, rendering the order unsustainable.
On the other hand, the respondents submitted that the order dated 10.07.2025 was passed after granting sufficient opportunity of hearing to both sides. It was emphasized that the appellant's counsel had participated both through video conferencing and later appeared physically. Hence, there was no violation of natural justice.
The NCLAT examined the issue of maintainability and the nature of the order. It noted that under Section 61 of the IBC, appeals lie only from orders passed by the Adjudicating Authority under Part II of the IBC. Since the impugned orders were not passed in the context of insolvency proceedings under Part II, the Tribunal concluded that an appeal under Section 61 of the IBC was not maintainable.
However, the Tribunal clarified that once a transfer application is filed and listed before the Court—even if presided over by the NCLT President—any resulting decision is judicial in nature, and not a mere administrative act. The bench held: “When an order is passed by the President on an application filed by an applicant for transfer of a case from one Bench to another, and the said application is listed in the Court for hearing, the Hon’ble President has to act judicially in considering the application, and any order passed in the said application is an order of judicial nature and is an order passed by NCLT amenable to appeal.”
The Tribunal went on to observe that the President of the NCLT does exercise administrative powers under Rule 16 of the NCLT Rules, 2016, including allocation and transfer of cases. However, once the application is judicially listed and argued, the order passed thereafter cannot be treated as merely administrative.
Addressing the grievance regarding hearing during lunch, the NCLAT found no substance in the objection. It noted that the matter had been listed urgently and that the hearing had taken place with proper participation by both parties. The Tribunal observed that there is no absolute bar under Rule 9 of the NCLT Rules to hear matters during the recess, especially in matters of urgency. The appellants had failed to demonstrate any procedural prejudice or denial of fair hearing.
The Tribunal also declined to interfere with the NCLT’s decision to defer other connected matters until the transfer applications filed by both sides were decided. It held that the NCLT had sufficient justification in doing so, and the decision was based on sound judicial reasoning. Accordingly, both appeals were dismissed, with the NCLAT affirming the judicial nature of the orders passed by the NCLT President and holding them to be appealable under Section 421 of the Companies Act, 2013.
Appearance
For Appellant: Mr. Deepak Khosla, Advocate
For Respondents: Mr. Abhijeet Sinha Sr. Advocate with Mr. Soayib Qureshi, Mr. Sandeep Bajaj, Ms. Anchal Kushwaha, Advocates. Mr. Gopal Jain Sr. Advocate with Mr. Deep Roy and Mr. Dhaval Saula, Advocates for RP.
Cause Title: Sayam Shares & Securities (P) Ltd. V. KSS Petron (P) Ltd. & Anr.
Case No: Company Appeal (AT) (Insolvency) No. 1001 of 2025
Coram: Justice Ashok Bhushan [Chairperson], Mr. Barun Mitra [Technical Member]
