Recall Cannot Be Used To Review Order On Merits: NCLAT Rejects ED's Plea In Adel Landmark CIRP

The National Company Law Appellate Tribunal (NCLAT) has rejected the Directorate of Enforcement's (ED) application seeking recall of its earlier order reviving consideration of a resolution plan in the insolvency proceedings of Adel Landmarks Ltd.

The tribunal held that the ED was effectively seeking a review of the order under the guise of recall.

A Bench of Officiating Chairperson Justice Yogesh Khanna and Technical Members Barun Mitra and Ajai Das Mehrotra observed:

“Thus, we are persuaded to believe that the Applicant-ED under the guise of recall is seeking a rehearing and review of the impugned order on merits together with a fresh declaratory relief which is impermissible in the exercise of power of recall. The present application of the Applicant is styled as recall but in essence is a review application and therefore cannot be entertained.”

The dispute arose after the National Company Law Tribunal (NCLT) declined to approve the resolution plan and sent it back to the Committee of Creditors (CoC) for reconsideration. The NCLT had taken into account a Provisional Attachment Order issued by the ED on January 9, 2026, attaching certain assets of the corporate debtor.

The successful resolution applicant challenged the NCLT's remand order. On April 16, 2026, the NCLAT set it aside and revived the plan approval application. The NCLT approved the plan on May 19. The ED sought recall, alleging it was not heard despite the NCLT considering its submissions on attached properties. The NCLAT observed that the ED had time to appeal but instead filed the recall application on July 20, without explaining the delay.

The tribunal clarified that its April 16 order had neither stayed nor set aside the ED's attachment order. It had only set aside the NCLT's decision to remand the plan to the CoC and revived the plan approval application for fresh consideration. The order did not decide the validity of the attachment proceedings or the sustainability of the resolution plan.

Since the April 16 order had neither adjudicated the ED's rights nor interfered with its interests, the tribunal found no ground for recall. It also held that the ED's request for a declaration that the attached properties could never form part of the resolution plan sought substantive relief on merits, which fell outside the scope of a recall application.

The NCLAT dismissed the application without costs.