NCLAT Rejects Conditional Withdrawal of Appeal Citing Finality of Supreme Court-Confirmed Property Sale
- REEDLAW
- 9 hours ago
- 3 min read
The NCLAT rejected the conditional withdrawal of the appeal, citing the finality of the property sale as confirmed by the Supreme Court.
On 10 June 2025, the National Company Law Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Sharad Kumar Sharma (Judicial Member) and Mr. Jatindranath Swain (Technical Member), considered an appeal along with connected interlocutory applications and held that once the Supreme Court has confirmed the sale of the subject property and conclusively settled the issue, the appellant cannot be granted liberty to pursue further legal remedies on the same subject matter. The Tribunal observed that the withdrawal of an appeal must be unconditional when the dispute has attained finality.
In the present case, the Appellant had filed a Company Appeal before the National Company Law Appellate Tribunal (NCLAT), challenging the order dated 11.08.2023 passed by the National Company Law Tribunal (NCLT), Chennai Bench. The impugned order had dismissed Interlocutory Applications filed under Section 60(5) and Section 33(3) of the Insolvency and Bankruptcy Code, 201,6, read with Rule 11 of the NCLT Rules, 2016, and imposed a cost of ₹1,00,000. While the NCLAT initially did not go into the merits of the impugned order, it considered the Memorandum of Withdrawal of the Appeal subsequently filed by the Appellant.
The underlying dispute related to a real estate asset and financial claims involving GMADA and various respondents. Parallel to the proceedings before the NCLT, the Appellant had approached the Madras High Court through Writ Petition No. 1001 of 2025 seeking relief under Article 226 of the Constitution, particularly with respect to waiver of the statutory pre-deposit requirement under Section 18 of the SARFAESI Act, 2002, in connection with proceedings before the Debt Recovery Appellate Tribunal (DRAT). During the pendency of the writ, the Appellant made a statement that Respondent No. 1 had accepted the offer made by GRT Hotels and Resorts Pvt. Ltd., and agreed not to pursue the appeal before the DRT. Based on this assurance, the High Court disposed of the writ.
The High Court’s order was subsequently challenged before the Supreme Court by GBJ Hotels Pvt. Ltd. in SLP (C) No. 7301/2025. By judgment dated 28.04.2025, the Apex Court confirmed the sale of the subject property in favour of GRT Hotels and directed Edelweiss Asset Reconstruction Company Ltd. to take steps to secure peaceful possession and to withdraw the ₹33 crore deposited, while expressly leaving all other questions open to be adjudicated before appropriate forums, except the validity of the sale itself.
In light of the Apex Court’s judgment GBJ Hotels Private Limited v. Sriharan Sripathmanathan and Others, REEDLAW 2025 SC 04631, confirming the sale and settling the substantive issue concerning the property, the NCLAT observed that permitting the Appellant to reserve liberty to initiate further proceedings on the same subject would be contrary to the finality attained by the Supreme Court’s decision. The Tribunal took note of the Respondents’ objection to the Appellant’s request for such liberty and found the objection reasonable and justified.
Consequently, the NCLAT allowed the Memorandum of Withdrawal but did not permit any liberty to pursue fresh legal remedies concerning the same dispute. The Company Appeal was accordingly dismissed as withdrawn simplicitor, with no reservation of rights in favour of the Appellant to agitate the matter afresh.
Mr. Arvindan, Advocate for Ms. J. Parimalam, Advocate, represented the Appellant.
Mr. Prajeish, Advocate for King & Partridge, appeared for Respondent No. 1 to Respondent No. 4 & Respondent No. 7.
Ms. Indumathi Ravi, Advocate for Ms. C. Keerthana, Advocate, appeared for Respondent No.6.
Mr. R. Subramanian, Advocate, represented the Respondent No. 8.
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