The Gujarat High Court held that a pending appeal before NCLAT bars a writ petition under IBC, affirming exclusive jurisdiction of tribunals.
Pending NCLAT Appeal Bars Parallel IBC Writ: Gujarat High Court
The Gujarat High Court ruled that a writ petition challenging an insolvency order is not maintainable when an appeal is already pending before the National Company Law Appellate Tribunal (NCLAT). The Court emphasized the exclusive jurisdiction of NCLAT under the Insolvency and Bankruptcy Code (IBC), 2016, to hear appeals against orders of the NCLT.
The petitioner had approached the High Court under Article 226 seeking relief against an NCLT decision, even though a statutory appeal under Section 61 of the IBC was already filed before NCLAT. The Court stressed that where a specific appellate remedy is available, it must be exhausted before seeking writ jurisdiction. The availability of a detailed statutory mechanism under IBC renders parallel writ proceedings impermissible.
"Where a statute creates a tribunal with special jurisdiction and provides an appellate mechanism, the High Court's writ jurisdiction under Article 226 is circumscribed."
This decision reinforces the principle of forum exclusivity in IBC proceedings. Practitioners must ensure that parties exhaust appellate remedies before tribunals and refrain from seeking duplicative relief in writ courts, which may lead to dismissal on jurisdictional grounds.
Citations
- Insolvency and Bankruptcy Code, 2016, Section 61