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2021 (11) TMI 793 - AT - Insolvency and BankruptcyInitiation of contempt proceedings against the Respondent for wilful disobedience - Jurisdiction of NCLT - Section 425 of the Companies Act, 2013 r/w Section 12 of the Contempt of Courts Act, 1971 and Rule 11 of the NCLT Rules, 2016) - HELD THAT:- This ‘Tribunal’ relevantly points out that the ‘Adjudicating Authority’ (National Company Law Tribunal) in Contempt Application No.A-01(PB) of 2020 in CA-1081/2019 in (IB)-560(PB)/2017 (filed under Section 425 of the Companies Act, 2013 r/w Section 12 of Contempt of Courts Act and Rule 11 of the NCLT Rules, 2016) seeking to initiate the contempt proceedings against the Respondent therein (1st Respondent in the Appeal) for wilful disobedience of the Order dated 7.11.2019 passed by the Tribunal in Contempt Application No.A-01(PB) of 2020 in CA-1081/2019 in (IB)-560(PB)/2017 on 23.9.2020, had finally dismissed the application by observing that ‘IBC’ is devoid of ‘contempt jurisdiction’, leaving it open to the Appellant/Applicant to seek remedy through recourses available. The definition of Section 5(1) of the I&B Code under Part II ‘Insolvency Resolution and Liquidation for Corporate Persons’ Chapter I ‘Preliminary’ means the ‘Adjudicating Authority’ for the purpose of this Part as ‘National Company Law Tribunal’ constituted under Section 408 of the Companies Act, 2013. Section 408 of the Companies Act, 2013 provides for the constitution of ‘National Company Law Tribunal’. Section 410 of the Companies Act, 2013 pertains to ‘constitution’ of the ‘Appellate Tribunal’ - the National Company Law Tribunal is to act as an Adjudicating Authority for the purpose of matters pertaining to the I&B Code. Under the I&B Code, 2016 the Adjudicating Authority (National Company Law Tribunal) adjudicates all proceedings before it and renders its decision. Just because the I&B Code does not specifically mention about the contempt provisions, it cannot be said that the ‘Adjudicating Authority’ (National Company Law Tribunal) has no powers of contempt. If one is to give such a restricted interpretation that the Adjudicating Authority (National Company Law Tribunal) has no jurisdiction of contempt, then it orders cannot be implemented and in fact, the I&B Code will remain in ‘Black Letters’ without a teeth to bite, in the considered opinion of this Tribunal - as per Section 425 of the Companies Act, 2013 it is clear that the ‘Contempt proceedings’ can be exercised by the ‘National Company Law Tribunal’, being the ‘Adjudicating Authority’ as per Section 5(1) of the I&B Code. Also that a conjoined reading of Section 408 and 425 of the Companies Act, 2013 will unerringly points out that the power to punish for ‘Contempt’ is vested with the ‘Tribunal’ shall be while adjudicating on matter not only confine to the Companies Act, 2013 but also to matters relating to the I&B Code, 2016. The Tribunal (NCLT) and the Appellate Tribunal (NCLAT) have the same ‘jurisdiction’, ‘powers’ and ‘Authority’ in respect of contempt of it as the ‘High Court’ viewed in that perspective, the conclusions arrived at by the Adjudicating Authority (National Company Law Tribunal) in the impugned order by making it clear that the IBC is devoid of contempt of jurisdiction and thereby dismissing the application, leaving it open to the Appellant/Applicant to seek remedy through recourses available, are clearly unsustainable in the eye of Law and the same is interfered with by this ‘Tribunal’ in furtherance substantial cause of justice, sitting in ‘Appellate Jurisdiction’. Application allowed.
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