Over 80% Of NCLT, NCLAT Workforce Is Contractual; Justice Pankaj Mithal Calls For Reforms

Supreme Court judge Justice Pankaj Mithal on Monday said that more than 80% of the workforce of the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) consists of contractual employees, warning that the heavy dependence on temporary staff is disrupting the functioning of India's insolvency adjudication system.

Speaking at an event marking 10 years of the NCLT and NCLAT at the Constitution Club of India in New Delhi, Justice Mithal said the completion of a decade of the two tribunals was not merely an occasion for celebration but also for introspection on whether the reforms had translated into a better justice delivery experience.

While acknowledging that the NCLT and NCLAT have played a central role in shaping India's insolvency and company law jurisprudence, Justice Mithal said several structural challenges continue to persist despite the objectives of the Insolvency and Bankruptcy Code (IBC).

"Contractual staff constitute more than 80 per cent of the workforce of both NCLT and NCLAT. This heavy reliance on contractual staff severely disrupts continuity in basic operational and administrative functions. It creates repeated inefficient cycles of recruitment and induction while short employment periods create deep uncertainties in the career trajectories of these workers," he said.

Justice Mittal noted that growing public confidence in the tribunal system had led to increasing caseloads, with more than 18,000 cases pending across various benches. He said the timelines envisaged under the insolvency framework had often not been realised because of complex litigation, repeated appellate interventions, infrastructure limitations, and chronic vacancies.

"Growing public confidence has flooded the tribunals with mounting caseloads. Pendency continues to pose a serious challenge," he said.

Justice Mithal observed that the creation of new institutions alone cannot guarantee substantive reform unless they are supported by adequate infrastructure, timely appointments, procedural discipline, and institutional continuity.

"The focus must now shift from institutional creation to institutional strengthening. We have to strengthen the institutions; there is no point creating different forums and tribunalisations unless we are able to strengthen those institutions," he said.

He also questioned whether tribunalisation had fully achieved one of its key objectives of reducing the burden on constitutional courts. While company and insolvency disputes are now adjudicated by the NCLT and NCLAT instead of High Courts at the first instance, many significant matters ultimately continue to reach the Supreme Court.

"This naturally raises an important institutional question. Has the system genuinely reduced litigation burden and improved finality, or has it merely altered the route through which the litigation travels?" he said.

Justice Mithal also identified asset recovery as a continuing challenge within the insolvency framework. He said distressed assets are often valued primarily on their immediate liquidation potential rather than their long-term enterprise value, while a limited pool of quality resolution applicants further depresses value realisation.

To improve recoveries, Justice Mithal said the insolvency framework needs stronger support systems around liquidators and registered valuers.

He suggested clear operating procedures, better audit mechanisms and reviews of valuations after resolution plans are implemented.

The feasibility of carrying out fresh valuations after specified intervals should also be examined, he added. Turning to the future of the insolvency regime, Justice Mithal said mediation should play a greater role in resolving commercial disputes.

Structured mediation conducted by professionals with commercial and legal expertise could help parties arrive at solutions more quickly and at lower cost, while easing the burden on tribunals.

He also called for greater consistency in procedures across commercial tribunals. Different procedural requirements and limitation periods for disputes arising out of similar transactions often create unnecessary complexity and uncertainty for litigants, he said.

Another priority, according to Justice Mithal, is ensuring that vacancies are filled without delay. He also underscored the need for stronger digital infrastructure, including effective e-filing systems, integrated case-management tools and better administrative support across tribunal benches

On appellate review, he cautioned against excessive interventions in commercial disputes.

"Commercial adjudication requires both judicial scrutiny and finality. Repeated interventions erode the value of the resolution process itself. The appellate structure should serve as a guardian of legality, not as an alternative commercial forum," he said.

Justice Mithal also urged policymakers and adjudicatory institutions to pay greater attention to smaller stakeholders within the insolvency framework, including MSMEs, workers, operational creditors and homebuyers.

"The effectiveness of insolvency law cannot be measured solely through large corporate resolutions. Its true success depends upon whether ordinary stakeholders can realistically access timely justice," he said.

The remarks were made at the 10th anniversary celebrations of the NCLT and NCLAT organised by the NCLT and NCLAT Bar Association at the Constitution Club of India.

Former Chief Justice of India Justice B.R. Gavai; Law, Union Minister of Law and Justice Arjun Ram Meghwal; NCLAT Chairperson Justice Ashok Bhushan; NCLT President Justice Anupinder Singh Grewal; and former Supreme Court judge Justice Rajesh Bindal also addressed the gathering, which was attended by members of the tribunals, senior advocates, insolvency professionals, bankers, and members of the Bar.