2. In the matter of Monica Jajoo v. PHL Fininvest Private Limited (Company Appeal (AT) (Ins) No. 1344 & 1345 of 2022), the appellant, who was a personal guarantor to a corporate debtor named Hema Engineering Industries Limited (“HEIL”), had challenged an order of Bench IV of the National Company Law Tribunal (NCLT), New Delhi admitting an application of personal insolvency against the appellant, inter alia on the ground that since liquidation proceedings against HEIL were pending before Bench III of the NCLT, the Bench IV of NCLT New Delhi lacked jurisdiction on account of provisions contained in sub-section (2) and (3) of Section 60 of the Code. In other words, the contention of the appellant was that a Section 95 application should have been considered and heard by the same bench of NCLT, New Delhi which was considering the liquidation proceedings regarding HEIL. The aforesaid submission found favour with NCLAT which took note of the fact that sub-sections (1) and (2) of Section 60 stipulated and mandated that an application relating to insolvency resolution and liquidation of the corporate debtor is required to be filed within “such” NCLT where a CIRP or liquidation proceedings of the “same” corporate debtor is pending. Accordingly, it held that Bench IV of NCLT, New Delhi lacked the jurisdiction to adjudicate upon the application and that it should have transferred the application to Bench III which was already considering the liquidation proceeding of HEIL under the Code.
In our view, it probably was not the intention of the legislature that proceedings would have to be heard by the “same” bench and as long as the proceedings were being heard by the same Adjudicating Authority/NCLT, the composition of the bench should not matter. A fallout of this decision could be, where there has been change in the composition of the bench on account of change in members, one could come and argue that the bench which was in seisin of the proceeding against the corporate debtor was not the “same” bench and hence lacks jurisdiction.
We also note that one of the factors which influenced the decision of NCLAT was that a transfer petition was filed before Bench IV, NCLT, New Delhi for the transfer of a petition to Bench III, NCLT, New Delhi, which application was ignored. In our understanding, such a transfer application could have only been filed before the president of NCLT in terms of rule 16(d) of NCLT Rules, 2016 and not before any other bench of NCLT. However, the NCLAT appears to have overlooked the technical requirement.
Source: Barandbench
