The Delhi High Court has ruled that the issue of applicability of the Notification dated 24 March 2020, which has increased the pecuniary threshold under Insolvency & Bankruptcy Code to Rs 1 crore, to a particular case cannot be determined by the Registrar of NCLT in his administrative capacity in the case of Skillstech Services Private Limited v. Registrar, NCLT, New Delhi and Another, REED 2021 Del 1314.
The Court was dealing with a petition under section 9 of IBC seeking listing before the appropriate bench of the NCLT. It was the petitioner's grievance that the Registrar of the NCLT did not list the matter before the appropriate bench on the ground that the threshold of the pecuniary jurisdiction of the NCLT had been increased from Rs. 1 lakh to Rs. 1 crore.
The counsel for the petitioner argued that the question as to whether the NCLT had the pecuniary jurisdiction could not be decided by the Registrar and the same ought to be looked into and determined by an appropriate bench of the NCLT, after appreciating the fact situation involved.
Reliance was placed on an Tharakan Web Innovations Private Limited v. Cyriac Njavally, REED 2020 NCLT Kochi 9009 holding that if disputes had arisen prior to the outbreak of the pandemic, the notification would not apply as it could not be made applicable retrospectively.
In response, the Central government counsel said that the NCLT order being relied upon by the Petitioner had been stayed by the Kerala High Court. [ Tharakan Web Innovations Private Limited v. National Company Law Tribunal and Another, REED 2020 Ker 9032 ]
In view of the submissions made by the parties, the Court opined that it was for the appropriate bench of the NCLT to judicially determine the issue and decide whether notice was liable to be issued in the matter or not.
The Court observed, "This court is of the opinion that the question as to whether the NCLT has jurisdiction to entertain a particular case or not cannot be determined by the Registrar in the administrative capacity. The Registrar would have to place the matter before the appropriate bench of the NCLT, for the said question to be judicially determined. The appropriate bench of the NCLT would have to then, take a considered view as to whether notice is liable to be issued in the matter or not."
It added, "The question as to whether the notification dated 24th March, 2020 applies to a particular petition that has been filed prior to the said notification or not is also a question to be determined by the Bench of the NCLT and not by the Registrar of the Tribunal."
Accordingly, the Court directed that the petition under section 9 IBC be placed by the Registrar, NCLT before an appropriate bench for proceeding further in accordance with law.
Advocate Swaroop George appeared for the Petitioner. Standing Counsel Harish Vaidyanathan appeared for Centre.