Case Note & Summary
The dispute arose when Mirosa Marines Pvt. Ltd. (Appellant) filed an application (I.A. No. 28/2023) before the National Company Law Tribunal (NCLT), Mumbai Bench, invoking Section 60(5) of the Insolvency and Bankruptcy Code, 2016 (IBC). The Appellant contended that the Respondent failed to furnish original documents as anticipated, prompting the filing of the application on 02.12.2022. The NCLT disposed of I.A. No. 28/2023 on 26.11.2024 without the Appellant's presence, leading to a decision that lacked consideration of the Appellant's arguments. Subsequently, the Appellant filed I.A. No. 472/2025, seeking to recall the earlier order due to the absence of a hearing. The Tribunal rejected this recall application, asserting that the merits of I.A. No. 28/2023 had been addressed. The Appellant argued that the Tribunal's findings were perverse as they did not reflect a proper hearing. The NCLAT found that the Tribunal had exceeded its jurisdiction by addressing the merits of I.A. No. 28/2023 while considering the recall application. The NCLAT quashed the order dated 10.02.2025 and remitted the matter back to the Tribunal for a fresh consideration of I.A. No. 28/2023, ensuring the Appellant was provided an effective hearing.
Headnote
A) Insolvency Law - Ex Parte Proceedings - Right to Effective Hearing - Insolvency and Bankruptcy Code, 2016, Section 60(5) - The Tribunal failed to provide the Appellant an opportunity to be heard before disposing of the application I.A. No. 28/2023, leading to a procedural irregularity. Held that the order dated 26.11.2024 was perverse due to lack of hearing (Paras 4-10). B) Insolvency Law - Recall of Application - Justification for Invocation of Rule 11 - Insolvency and Bankruptcy Code, 2016, Rule 11 - The Tribunal exceeded its jurisdiction by addressing merits of I.A. No. 28/2023 while adjudicating I.A. No. 472/2025, which was solely for recall. Held that the rejection of the recall application was flawed (Paras 8-10).
Issue of Consideration
Whether the Tribunal erred in rejecting the recall application without providing an effective hearing to the Appellant.
Final Decision
The NCLAT quashed the order dated 10.02.2025 and remitted the matter back to the NCLT to consider I.A. No. 28/2023 on merits after providing an opportunity to the Appellant.
Law Points
- ex parte proceedings
- effective hearing
- procedural vices
- merits determination
- IBC Code provisions
