Davis Koottala Varkey & Ors. Vs Samson T. George & Ors. (Supreme Court of India)
Summary: The Supreme Court, in Davis Koottala Varkey & Ors. Vs Samson T. George & Ors., set aside the Kerala High Court’s order dated 21 April 2026 entertaining a writ petition challenging an order passed by the National Company Law Tribunal (NCLT) during liquidation proceedings under the Insolvency and Bankruptcy Code, 2016 (IBC).
The appellants contended that although statutory provisions cannot curtail the constitutional powers of High Courts under Articles 226 and 227, judicial discipline requires challenges to orders passed under a special statute to follow the remedies prescribed therein. Accepting this contention, the Supreme Court observed that Section 61 of the IBC provides a broadly worded right of appeal to any person aggrieved by an order of the adjudicating authority under Part II of the Code. The provision does not restrict the right of appeal by specifying the nature of the order. In support of their submissions, the appellants relied upon the Supreme Court decisions in Committee of Creditors of KSK Mahanadi Power Company Ltd. v. Uttar Pradesh Power Corporation Ltd. and Others and Mohammed Enterprises (Tanzania) Ltd. v. Farooq Ali Khan.
The Court emphasised that High Courts should ordinarily refrain from entertaining challenges against NCLT orders when the aggrieved parties can raise their grievances before the appellate tribunal. Accordingly, the impugned order was set aside and the writ petition dismissed on the ground of availability of an alternative statutory remedy.
Considering the respondents’ submission regarding expiry of the statutory appeal period of 45 days, the Supreme Court observed that if an appeal was filed before the NCLAT within 15 days, accompanied by an application under Section 14 of the Limitation Act, 1963, seeking exclusion of the period spent pursuing proceedings before the High Court and Supreme Court, such application should receive due consideration in accordance with law. The appeal was accordingly allowed without granting automatic exclusion of the limitation period.
Cases Discussed
- Mohammed Enterprises (Tanzania) Ltd. Vs Farooq Ali Khan & Ors. — 2025 SCC OnLine SC 23 (Supreme Court). Cited in support of judicial restraint in exercising writ jurisdiction where statutory remedies are available under the IBC.
- Committee of Creditors of KSK Mahanadi Power Company Ltd. Vs Uttar Pradesh Power Corporation Ltd. & Ors. — 2024 SCC OnLine SC 4013 (Supreme Court). Cited in support of adherence to judicial discipline and the statutory mechanism governing insolvency proceedings.
FULL TEXT OF THE ORDER OF SUPREME COURT OF INDIA
1. Leave granted.
2. Heard learned counsel for the parties.
3. This appeal questions the order of the High Court of Kerala dated 21.04.2026 by which the writ petition against the order of National Company Law Tribunal (‘NCLT’) passed during liquidation proceedings was entertained, notice was issued and an interim order was passed.
4. On 26.05.2026, while entertaining this appeal, we had passed the following order:
“1. The submission of the learned counsel for the petitioner is that the High Court ought not to have entertained a challenge to the proceedings before the National Company Law Tribunal (“NCLT”) which were under the Insolvency and Bankruptcy Code, 2016 (“IBC”). Reliance has been placed on two decisions of this Court, namely, Committee of Creditors of KSK Mahanadi Power Company Ltd. v. Uttar Pradesh Power Corporation Ltd. and Others and Mohammed Enterprises (Tanzania) Ltd. v. Farooq Ali Khan.
2. Issue notice, returnable in eight weeks.
3. In the meantime, the impugned order dated 21.04.2026 shall remain stayed.
4. Further proceedings in O.P.C. No. 295 of 2026 shall also remain stayed.“
5. The learned counsel for the appellant(s) submits that, though powers under Articles 226 and 227 of the Constitution of India cannot be whittled down by statutory provisions, where proceedings are under a statute and the statute frames a mechanism to challenge order(s) passed in those proceedings, judicial discipline requires that orders passed therein be challenged within the statutory framework. Therefore, orders passed in proceedings under the Insolvency and Bankruptcy Code, 2016 (‘Code’) must be challenged within the framework of the Code and not through a writ petition as has been held by this Court in Committee of Creditors of KSK Mahanadi Power Company Ltd. v. Uttar Pradesh Power Corporation Ltd. and Others1 and Mohammed Enterprises (Tanzania) Ltd. v. Farooq Ali Khan2.
6. We find substance in the aforesaid submission. Section 61 of the Code provides for a right of appeal to any ‘person aggrieved’ by the order of the adjudicating authority under Part II of the Code. The right to appeal is provided in broad terms to any ‘person aggrieved’ by the order. Besides, the appeal provision uses the word ‘order’ without specifying its nature. In such circumstances, the judicial discipline would require the High Court to refrain itself from entertaining a challenge to the order passed by the Adjudicating Authority/ NCLT under the provisions of the Code, particularly when the aggrieved person can raise his grievances in the appeal.
7. We, therefore, set aside the order dated 21.04.2026 and dismiss the writ petition on the ground of alternative remedy by giving liberty to the writ petitioners to take recourse to appropriate legal remedy under the Code.
8. At this stage, the learned counsel for the respondents submits that under the Code, an appeal is to be filed within a specified period and that period is not extendable beyond 45 days and since that period has already expired, this Court may give liberty to the respondent(s) to file an appeal along with an application under Section 14 of the Limitation Act, 1963.
9. Having regard to the facts of the case, we deem it appropriate to observe that in case an appeal is preferred by the respondent(s) before the National Company Law Appellate Tribunal within 15 days from today, along with an application, under Section 14 of the Limitation Act, 1963, seeking exclusion of the period during which the proceedings were pending before the High Court and this Court, the same shall be accorded due consideration in accordance with law.
10. The appeal is allowed as above. Pending application(s), if any, shall stand disposed of.
1. Leave granted.
2. The appeal is allowed in terms of the signed order which is placed on the file.
3. All pending applications including IA No. 188366/2026 and IA No.188337/2026 shall stand disposed of.
Notes:
2 2025 SCC OnLine SC 23 ↩
