Govt moves NCLAT against NCLT directive to make MCA party in all insolvency cases

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Published: December 6, 2019 4:36:53 AM

Adjudicating on an insolvency matter, the NCLT's principal Bench, headed by its president Justice MM Kumar, had said its order would facilitate availability of the authentic record for “proper appreciation of the matters”.

NCLAT, NCLT, Ministry of Corporate Affairs, Sikka Papers, Oriental Bank of Commerce, IBCThe NCLT, it said, can not implead the MCA in all cases and in such a manner.

The government has moved a petition before the National Company Law Appellate Tribunal (NCLAT) challenging the National Company Law Tribunal’s November 22 order that made it mandatory for the Ministry of Corporate Affairs (MCA) to be a party in all the cases under the Insolvency and Bankruptcy Code (IBC) and company petitions before it .

Adjudicating on an insolvency matter, the NCLT’s principal Bench, headed by its president Justice MM Kumar, had said its order would facilitate availability of the authentic record for “proper appreciation of the matters”. In its petition, submitted Thursday, the MCA described the insolvency court’s order as “arbitrary” and beyond the conferred power and jurisdiction upon the NCLT. The NCLT, it said, can not implead the MCA in all cases and in such a manner.

Sanjay Shorey, director (legal prosecution), MCA, mentioned the matter on Thursday before the NCLAT, which
is likely to hear the matter on Friday. The NCLT, which was hearing Oriental Bank of Commerce’s insolvency plea against Sikka Papers under Section 7 of the IBC, had also said the direction would be applicable throughout the country to all NCLT Benches.

“The Registrar shall send a copy of this order to all NCLT Benches so that respective deputy registrar may ensure that proper parties are impleaded,” the NCLT order said.

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