Supreme Court Dismisses SEBI Appeal Against NCLAT Order Rejecting Recall Plea In Pancard Clubs Insolvency

The Supreme Court on Monday refused to reopen SEBI's challenge to the Pancard Clubs insolvency proceedings. It upheld an NCLAT order holding that SEBI's fraud allegations fell outside the scope of proceedings on condonation of delay.

A Bench of Justice J.B. Pardiwala and Justice Vijay Bishnoi dismissed SEBI's appeal against the National Company Law Appellate Tribunal's November 3, 2025 order rejecting its recall plea.

“Having heard Mr. C.U. Singh, the learned Senior counsel appearing for the appellant – Securities and Exchange Board of India and having gone through the materials on record, we find no good ground to interfere with the impugned Order passed by the National Company Law Appellate Tribunal” the court said.

The dispute arose from insolvency proceedings against Pancard Clubs, where the NCLT Mumbai passed an order on April 25, 2024 initiating CIRP against the company. SEBI later challenged the proceedings before the NCLAT, alleging fraud in the CIRP and the resolution process.

However, the NCLAT on November 21, 2024 refused to condone the delay in filing SEBI's appeal, holding that it had been filed beyond the condonable period prescribed under the Insolvency and Bankruptcy Code.

SEBI then approached the Supreme Court. The appeals were dismissed on January 24, 2025 after SEBI stated that it intended to move the NCLAT with a review application.

SEBI subsequently filed a recall application before the NCLAT contending that grounds including exclusion of time under Section 14 of the Limitation Act had not been properly considered earlier. It also raised allegations of fraud in the CIRP.

Rejecting the plea, the NCLAT held that the recall application did not satisfy the settled grounds for recalling a judgment. The appellate tribunal further observed that the fraud allegations raised by SEBI related to the CIRP itself and not to the order refusing condonation of delay. Such issues, it held, could not be examined while deciding a delay condonation application.

The NCLAT also noted that the Supreme Court had already dismissed SEBI's earlier appeals against the November 21, 2024 order and had not granted liberty to file a recall application.

Accordingly, the Supreme Court dismissed SEBI's appeal.