NCLAT Holds the NCLT President May Transfer a Case Across Territorial Jurisdictions Under Rule 16(d)

Background and Facts

The National Company Law Appellate Tribunal on September 11, 2026 held that the power of the President of the National Company Law Tribunal to transfer a case from one Bench to another is not confined by the territorial limits of those Benches. The ruling in Kamlesh Rani Singla v. Praveen Kumar Garg and Others [Company Appeal (AT) (Insolvency) No. 275 of 2026] is reported as 2026 LLBiz NCLAT 347.

Laxmi Pipes Limited was admitted into the Corporate Insolvency Resolution Process before the Chandigarh Bench-II of the Tribunal on May 17, 2023. Separately, an operational creditor initiated proceedings under Section 95 of the Insolvency and Bankruptcy Code, 2016 against Kamlesh Rani Singla, a suspended director and personal guarantor, before the New Delhi Bench-II, which admitted that application on May 28, 2024.

Singla applied to have the personal guarantor proceedings moved to Chandigarh so that both matters would be heard together. The New Delhi Bench dismissed that application on December 5, 2025, relying on a reading of the transfer power that confined it within territorial boundaries.

Key Legal Issue

Whether Rule 16(d) of the National Company Law Tribunal Rules, 2016 permits the President to transfer a case to a Bench sitting in a different territorial jurisdiction, or whether the power is limited to transfers within the territory already assigned to the transferring Bench.

The NCLAT's Ruling

A three-member bench of Justice Sharad Kumar Sharma (Judicial Member), Arun Baroka (Technical Member) and Indevar Pandey (Technical Member) held that Rule 16(d) equips the President with sufficient power to transfer any case from one Bench to another, and that the power is not restricted or clouded by any territorial location.

The Text of Rule 16(d) Carries No Territorial Limit

Rule 16(d) of the 2016 Rules empowers the President to transfer any case from one Bench to another when circumstances so warrant. The Tribunal read the words as they stand. Nothing in the clause conditions the power on the transferee Bench sharing territorial jurisdiction with the transferor, and a limitation of that kind would have to be read into the rule rather than found in it.

Section 60 Points the Same Way

The statutory scheme supports consolidation. Section 60(1) of the Code fixes the Adjudicating Authority by reference to the registered office of the corporate person. Section 60(2) then requires that where a resolution process or liquidation of a corporate debtor is pending, an application relating to a corporate or personal guarantor be filed before that same Tribunal. Section 60(3) goes further and provides that guarantor proceedings pending in any court or tribunal stand transferred to the Adjudicating Authority dealing with the corporate debtor.

Read together, those provisions express a clear legislative preference for hearing the corporate debtor and its guarantors in one forum. A territorial reading of Rule 16(d) would frustrate that preference in precisely the situation Section 60(2) contemplates, which is where the two sets of proceedings have landed in different places.

A Conflicting High Court View Remains Live

The position is not settled. The Gujarat High Court in ArcelorMittal v. National Company Law Tribunal, decided on October 23, 2025, held that the President has no administrative authority to alter or extend the territorial jurisdiction of a Bench, and quashed the transfer of Essar Steel related matters from the Ahmedabad Bench to the Mumbai Bench.

That decision has been carried to the Supreme Court. On January 5, 2026 a bench of Chief Justice Surya Kant and Justice Joymalya Bagchi indicated that it would examine the scope of the power under Rule 16(d) and prima facie doubted the restriction imposed by the High Court, observing that such rigidity could leave proceedings stranded where a Bench recuses. No final decision of the Supreme Court on the question has been reported.

Practice Notes

In practice, the ruling reopens a route that had been treated as closed, but it should be used with the pending appeal in mind:

• For personal guarantors and their counsel: Where guarantor proceedings have been admitted before a Bench other than the one seized of the corporate debtor, a transfer application to the President is now supportable on the appellate authority, with Section 60(2) and 60(3) as the substantive anchor.

• For resolution professionals: Parallel proceedings in different Benches create duplicated claim verification and inconsistent findings on the same debt. Raise consolidation early rather than after the guarantor process has advanced.

• For creditors: Choosing a convenient Bench for a guarantor application is now a weaker tactic. Expect consolidation applications and budget for the possibility that the matter moves.

• On the appeal route: An order passed by the President under Rule 16(d) is not appealable under Section 61 of the Code, which is confined to orders under Part II. The appeal lies under Section 421 of the Companies Act, 2013, because the President exercises the power of the Tribunal. Filing under the wrong provision is a recurring and avoidable error.

• On the pending Supreme Court matter: Advise clients that the question is before the Supreme Court and that a contrary outcome would unsettle transfers made in the interim.

Key Provisions Discussed

• Rule 16(d), NCLT Rules, 2016: Power of the President to transfer any case from one Bench to another when circumstances so warrant.

• Rule 11, NCLT Rules, 2016: Inherent powers of the Tribunal to make such orders as may be necessary for meeting the ends of justice or to prevent abuse of its process.

• Section 60(1) of the IBC: Adjudicating Authority is the Tribunal having territorial jurisdiction over the registered office of the corporate person.

• Section 60(2) of the IBC: Guarantor applications to be filed before the Tribunal where the corporate debtor's process is pending.

• Section 60(3) of the IBC: Guarantor proceedings pending elsewhere stand transferred to that Adjudicating Authority.

• Section 95(1) of the IBC: Application by a creditor to initiate the insolvency resolution process, extended to personal guarantors of corporate debtors with effect from December 1, 2019.

• Section 421 of the Companies Act, 2013: Appeal to the Appellate Tribunal, the correct route against an order under Rule 16(d).

Case Details

• Case: Kamlesh Rani Singla v. Praveen Kumar Garg and Others

• Case No: Company Appeal (AT) (Insolvency) No. 275 of 2026

• Citation: 2026 LLBiz NCLAT 347

• Tribunal: National Company Law Appellate Tribunal, New Delhi

• Date of Order: September 11, 2026

• Bench: Justice Sharad Kumar Sharma (Judicial Member), Arun Baroka and Indevar Pandey (Technical Members)

• Order Below: NCLT New Delhi Bench-II order dated December 5, 2025 dismissing the transfer application

• Outcome: Rule 16(d) held not to be confined by territorial limits; the President's transfer power extends across Benches.

Sources and References

• NCLT President Can Transfer Cases Across Territorial Jurisdictions: NCLAT

• NCLT President has power to transfer cases across benches: NCLAT

• NCLT President cannot alter territorial jurisdiction of NCLT Benches while transferring cases: Gujarat High Court

• Can NCLT President transfer cases to NCLT benches in other states? Supreme Court to examine

• National Company Law Tribunal Rules, 2016, Rules 11 and 16(d)

• Insolvency and Bankruptcy Code, 2016, Sections 60(1), 60(2), 60(3) and 95(1)

• Companies Act, 2013, Section 421

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Readers should consult a qualified legal professional for advice specific to their circumstances.