Auditor Cannot Rely On Undocumented OTS Proposal To Ignore Borrower's Interest Liability: NCLAT

The National Company Law Appellate Tribunal (NCLAT) in Delhi on Monday held that a proposed One-Time Settlement (OTS) with lenders cannot justify an auditor issuing a clean audit report by ignoring accrued interest on borrowings classified as non-performing assets (NPAs). It ruled that an undocumented and unapproved OTS proposal cannot form the basis for derecognising a financial liability. "We are of the firm view that the OTS proposal that was never documented, never sanctioned by the bank's...

NCLAT Revives IL&FS Plea To Unwind ₹1,080 Crore SREI Group-Linked Lending Transactions

The National Company Law Appellate Tribunal (NCLAT) at Delhi has revived Infrastructure Leasing & Financial Services Ltd.'s (IL&FS) bid to unwind six lending transactions allegedly structured to bypass the Reserve Bank of India's directions restricting fresh lending to group companies. Setting aside an order of the Mumbai bench of the National Company Law Tribunal (NCLT), the appellate tribunal held that the lower tribunal had wrongly treated Srei Infrastructure Finance Ltd.'s (SIFL)...

Advance Paid For Kerala Trade Centre Space Not A Deposit With Kerala Chamber Of Commerce: NCLAT

The Chennai Bench of the National Company Law Appellate Tribunal (NCLAT) on 2 June held that an advance of Rs. 30,00,000 paid towards the Kerala Trade Centre project did not constitute a deposit with the Kerala Chamber of Commerce & Industry, but represented only an advance for booking space in a separate entity. Judicial Member Justice Sharad Kumar Sharma and Technical Member Jatindranath Swain dismissed an appeal filed by KM Abdullah, affirming the National Company Law Tribunal (NCLT),...

Eros Challenges NCLT Order Referring Colour Yellow Productions Dispute With Aanand L Rai to Arbitration

Eros International Media Limited has approached the National Company Law Appellate Tribunal (NCLAT) against an order that sent to arbitration its dispute with the promoters of Colour Yellow Productions Pvt. Ltd., including filmmaker Aanand L. Rai. A bench of Judicial Member Justice Sharad Kumar Sharma and Technical Member Arun Baroka took up the appeal on Monday and sought responses from the respondents. The challenge is directed against an April 28 order of the Mumbai bench of the National...

IL&FS Fraud Case: NCLAT Restrains Further Action Against Deloitte, SRBC, BSR

The National Company Law Appellate Tribunal (NCLAT) has recently restrained further action against Deloitte Haskins & Sells LLP, SRBC & Co LLP, BSR & Associates LLP and other auditors under Section 339 of the Companies Act, 2013 in the IL&FS matter, pending consideration of their challenge to the maintainability of the proceedings.The order was passed on May 26 by a bench of Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra. "We observe that question of...

NCLAT Refuses Stay On EOGM For Removal Of Jagran Prakashan Independent Directors

The New Delhi National Company Law Appellate Tribunal (NCLAT) on 26 May declined to stay the Extraordinary General Meeting (EOGM) convened for the removal of independent directors of Jagran Prakashan Limited (JPL) and disposed of the appeal filed by the directors. Judicial Member Justice Yogesh Khanna and Technical Member Ajai Das Mehrotra heard the appeal against the order of the NCLT Allahabad dated 23 April 2026. The Bench observed: “....what appears is the inter mingling of various issues...

Only Central Government Can Order SFIO Probes, Not Company Tribunals: NCLAT

The National Company Law Appellate Tribunal (NCLAT) in Delhi has recently reiterated that company tribunals cannot directly order a Serious Fraud Investigation Office probe, ruling that the power to direct such an investigation rests with the Central Government. A bench of Judicial Member Justice Mohd. Faiz Alam Khan and Technical Member Naresh Salecha relying on its own earlier decision observed, "The procedure for investigation in the affairs of the company has been provided under Section...

NCLAT Dismisses Former Stone Age Director's Appeal Over Removal, Refuses New Arguments At Appellate Stage

The National Company Law Appellate Tribunal (NCLAT) in Delhi has dismissed an appeal by a former Stone Age Pvt Ltd director, holding that it cannot act as a court of first instance to decide her argument that her removal from directorship was illegal because the company's Articles of Association did not require a whole-time director to seek reappointment. “Qua the argument the Article of Association of Respondent No.1 nor the provisions of Companies Act, 1956 contemplate any requirement for a...

NCLAT Rejects Dissenting Creditors' Challenge To NSEL Scheme Clauses On Broker Liability, Claims Assignment

The National Company Law Appellate Tribunal on Tuesday dismissed an appeal by Nirtex Exports & Investment Pvt. Ltd. and other specified creditors challenging the NCLT's approval of a settlement scheme in the 2013 National Spot Exchange Ltd. payment default matter, particularly provisions barring parallel claims against brokers. It held that creditors covered by the scheme cannot continue pursuing the same claims separately against brokers once those claims stand assigned under the...

High Courts Cannot Bypass Statutory Remedy Through Writ Jurisdiction: NCLAT Chennai

The Chennai Bench of the National Company Law Appellate Tribunal (NCLAT) on 30 April held that High Courts should not ordinarily exercise writ jurisdiction under Article 226 when a statutory appellate remedy exists under the Companies Act framework. A Bench of Judicial Member Justice Sharad Kumar Sharma and Technical Member Jatindranath Swain also held that litigants cannot seek exclusion of time under Section 14 of the Limitation Act, 1963 when they approach the wrong forum without acting in...

NCLAT Sets Aside NCLT Order Cancelling 30,000-Share Allotment, 15,626-Share Sale In Peerless General Finance

The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently set aside a Kolkata NCLT order that had cancelled the allotment of 30,000 shares made in 1987–88 and the sale of 15,626 shares in Peerless General Finance & Investment Co. Ltd. (PGFI). It held that no case of oppression or mismanagement was made out under Sections 397–398 of the Companies Act, 1956. The appellate tribunal was hearing three connected appeals against a common order dated July 18, 2022 in a long-running...

Non-Compete Clause In Shareholder Agreement Binding On Auction Purchaser: NCLAT New Delhi

On 8 April, the New Delhi Bench of the National Company Law Appellate Tribunal (NCLAT) has held that non-compete obligations contained in a shareholder agreement can bind a purchaser of shares even if those obligations are not incorporated into the Articles of Association, particularly where the acquisition takes place through a liquidation auction. The Bench of Judicial Member Justice Yogesh Khanna and Technical Member Ajai Das Mehrotra observed: “If Flovel is allowed to compete with its own...