NCLAT can recall its judgments: Supreme Court affirms appellate tribunal ruling

The Court upheld a five-member coram ruling of the NCLAT Delhi that held that the appellate tribunal can entertain and allow applications for recall of its judgments.

The Supreme Court on Monday refused to interfere with a National Company Law Appellate Tribunal (NCLAT) order that had held that recall applications filed before it are maintainable. [Union Bank of India v. Financial Creditors of Amtek and ors]

A Bench of Justices Sanjay Kishan Kaul and Sudhanshu Dhulia declined to decide based on the merits and facts of the case.

We are in agreement with the view taken by the Five Judges Bench of the NCLAT and thus find no reason to interfere with the impugned judgment…The Civil Appeal is dismissed,” the order stated.

The Court upheld a five-member coram ruling of the NCLAT Delhi passed in January 2022. That verdict was authored by NCLAT Chairperson Justice Ashok Bhushan, Judicial Members Justices Rakesh Kumar Jain and Rakesh Kumar, and Technical Members Alok Srivastava and Barun Mitra.

The appellate tribunal held that in exercise of its inherent jurisdiction, it can entertain and allow applications for recall of its judgments, based on sufficient grounds.

Power of recall of a judgment can be exercised by this Tribunal when any procedural error is committed in delivering the earlier judgment; for example; necessary party has not been served or necessary party was not before the Tribunal when judgment was delivered adverse to a party. There may be other grounds for recall of a judgment. Well known ground on which a judgment can always be recalled by a Court is ground of fraud played on the Court in obtaining judgment from the Court,” the NCLAT had explained.

In deciding so, the appellate tribunal set aside two of its earlier rulings that had held to the contrary.

The NCLAT’s verdict came in an interlocutory application filed in the Corporate Insolvency Resolution Process (CIRP) initiated by Union Bank of India against Amtek Auto Limited (corporate debtor).

The reference to a five-member coram arose after the financial creditors of Amtek filed a petition seeking recall of an NCLAT order that had partly allowed the Bank’s appeal against a proposed resolution plan.

After the appellate tribunal held that the said recall application was maintainable, the Bank moved the Supreme Court.

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