NCLAT Upholds Order Directing Suspended Log 9 Directors To Help Gensol RP Recover Leased EVs

The National Company Law Appellate Tribunal (NCLAT) has upheld directions requiring the suspended directors of electric mobility company Log 9 Mobility Pvt. Ltd. to assist the resolution professional (RP) of EV leasing company Gensol EV Lease Ltd. in identifying and recovering leased electric vehicles.

It ruled that the National Company Law Tribunal (NCLT) has wide powers under Section 60(5) of the Insolvency and Bankruptcy Code (IBC) to issue such directions during insolvency proceedings.

A coram of Officiating Chairperson Justice Yogesh Khanna and Technical Members Barun Mitra and Ajai Das Mehrotra observed, "The ambit and scope of the Adjudicating Authority in terms of Section 60(5) of the IBC is wide enough for the Adjudicating Authority to have issued the directions to the Appellants to continue to cooperate in the identification and recovery of EVs with the Respondent No. 1 in the discharge of his duties for taking control and custody of assets over which the Corporate Debtor had ownership rights which directions had clear nexus with the insolvency resolution proceedings of the Corporate Debtor,"

The appeal arose from a July 21, 2026, order of the Ahmedabad bench of the NCLT. It had directed Akshay Singhal and Pankaj Sharma, suspended directors of Log 9, to appear at the office of Gensol's RP and take all necessary steps to identify and recover leased EVs from Faridabad.

Log 9 had leased electric vehicles from Gensol. Both companies are undergoing the Corporate Insolvency Resolution Process (CIRP), with separate resolution professionals appointed.

Gensol's RP approached the Ahmedabad bench of the NCLT seeking directions to secure the return of the leased vehicles, including those located in Faridabad.

The suspended directors argued that they had already cooperated by sharing detailed, vehicle-wise information. They contended that the NCLT could not compel their personal presence because they had no contractual relationship with Gensol. They also submitted that issuing directions against them in their individual capacity caused them serious prejudice.

Counsel for Gensol's RP, however, argued that repeated requests for information had failed to produce meaningful assistance in locating and recovering the vehicles. This, the RP submitted, prevented him from taking control and custody of the corporate debtor's assets and hampered the insolvency resolution process

The appellate tribunal noted that the NCLT issued the directions after finding that the information furnished by Log 9's RP had not proved useful in recovering the vehicles. It observed that the suspended directors could not "wash their hands off" their responsibility to assist in identifying and handing over the leased vehicles merely because the company had entered CIRP.

The bench also noted that the appellants had earlier acknowledged in pleadings before the NCLT that they had been providing information relating to the vehicles. They had also stated that they were assisting the CIRP by furnishing records and other details concerning the vehicles. The appellate tribunal observed that this was inconsistent with their argument that no directions could be issued against them in their individual capacity.

Referring to Section 60(5) of the IBC, the appellate tribunal observed that the provision gives the NCLT broad jurisdiction to decide questions arising out of or relating to insolvency proceedings.

"The expressions 'relating to' and 'arising out of' has to be interpreted to mean that it facilitates resolution of the Corporate Debtor in a manner that speedy resolution is not undermined nor the objective of preserving the maximum value of the assets of the Corporate Debtor is frustrated," the bench observed.

Finding no merit in the appeal, the appellate tribunal upheld the NCLT's order and dismissed the challenge.