NCLT President Can Transfer Cases Across Territorial Jurisdictions: NCLAT

The National Company Law Appellate Tribunal (NCLAT), New Delhi has ruled that the President of the National Company Law Tribunal (NCLT) can transfer a case from one bench to another even when the benches are in different territorial jurisdictions.

The bench comprising Judicial Member Justice Sharad Kumar Sharma, Technical Member Arun Baroka and Technical Member Indevar Pandey held that Rule 16(d) of the NCLT Rules, 2016 does not restrict the President's power to transfers within the same territorial jurisdiction.

“Rule 16(d) of the NCLT Rules 2016, administratively equips the President NCLT with sufficient power to transfer any case from one bench to the other bench. Further, the power of President NCLT is not restricted nor clouded to any territorial location,” the bench observed.

The ruling came in an appeal filed by Kamlesh Rani Singla, suspended director-cum-personal guarantor of Laxmi Pipes Ltd., against a December 5, 2025, order of the NCLT New Delhi Principal Bench.

Laxmi Pipes was undergoing the Corporate Insolvency Resolution Process (CIRP) before NCLT Chandigarh Bench-II. The CIRP had been admitted by that bench on May 17, 2023.

Operational creditor Praveen Kumar Garg initiated proceedings under Section 95 of the Insolvency and Bankruptcy Code (IBC) against Singla as Laxmi Pipes' personal guarantor before NCLT New Delhi Bench-II. The proceedings were admitted on May 28, 2024.

Singla then sought their transfer to NCLT Chandigarh Bench-II, where Laxmi Pipes' CIRP was pending. She relied on Section 60(2), which requires personal-guarantor insolvency proceedings to be filed before the same NCLT handling the corporate debtor's insolvency.

The NCLAT noted that the provision is intended to keep the related proceedings before the same NCLT and avoid conflicting decisions.

The NCLT Principal Bench dismissed the transfer application on December 5, 2025, relying on an October 16, 2025 Gujarat High Court ruling on the scope of Rule 16(d).

The Gujarat High Court had held that Rule 16(d) did not confer administrative power on the NCLT President to transfer cases beyond the territorial jurisdiction of a particular bench.

The NCLAT disagreed with this narrow interpretation.

Rule 16(d) empowers the NCLT President to “transfer any case from one Bench to other Bench when the circumstances so warrant.”

Rule 2(7) defines a “Bench” to include circuit benches constituted by the President at other geographical locations.

The NCLAT held that the President's power to transfer cases under Rule 16(d) is not restricted by territorial boundaries. Where a corporate debtor's CIRP is pending before one bench, proceedings against its personal guarantor can be transferred to that bench.

The tribunal also relied on its earlier decisions holding that Section 60(2) is mandatory.

Once the corporate debtor's CIRP is pending before a particular NCLT bench, proceedings relating to the insolvency resolution or bankruptcy of its personal guarantor must be filed before that same bench.

Applying this principle, the NCLAT held that NCLT New Delhi lacked both territorial and inherent jurisdiction to entertain or continue the Section 95 proceedings against Singla.

The continuation of those proceedings was therefore “void ab initio and without jurisdiction.”

The NCLAT accordingly set aside the order of the NCLT President in the transfer application and proceedings before the Delhi bench. 

It gave the respondents liberty to file proceedings as an operational creditor under Section 95 before the NCLT having appropriate jurisdiction.