Case Note & Summary
The appellant, Mr. Ashique Ponnambaramparambath, former Managing Director of M/s. Platino Classic Motors (India) Private Limited, filed an appeal before the National Company Law Appellate Tribunal (NCLAT), Chennai, challenging the order dated 14.02.2025 passed by the NCLT, Kochi Bench. The NCLT had rejected the appellant's recall application (IA(IBC)27/KOB/2025) seeking recall of an earlier order dated 11.12.2024 passed in IA/340/KOB/2023. The appellant contended that the order dated 11.12.2024 was a consent order, but he denied having given consent, alleging fraud and lack of jurisdiction. The appellant argued that the order was vitiated by fraud and that the Tribunal lacked jurisdiction, making it liable to be recalled under Rule 11 read with Rule 32 of the NCLT Rules, 2016. The appellant relied on the Supreme Court judgment in Sri Budhia Swain & Ors vs Gopinath Deb & Ors (1999) 4 SCC 396 to support the proposition that orders passed without jurisdiction or obtained by fraud can be recalled. The NCLAT, after hearing the counsel for the appellant, found that the appellant had not specifically pleaded or proved any fraud or lack of jurisdiction. The Tribunal observed that a consent order cannot be recalled merely on allegations without proper evidence. Consequently, the NCLAT dismissed the appeal, upholding the NCLT's order rejecting the recall application.
Headnote
A) Insolvency Law - Recall of Consent Order - Rule 11 read with Rule 32 of NCLT Rules, 2016 - The appellant sought recall of a consent order dated 11.12.2024 alleging fraud and lack of jurisdiction - The NCLT rejected the recall application - The NCLAT held that a consent order cannot be recalled unless fraud or lack of jurisdiction is specifically pleaded and proved - The appeal was dismissed as the appellant failed to establish any fraud or jurisdictional error (Paras 1-5).
Issue of Consideration
Whether the impugned order rejecting the recall application was justified, and whether a consent order can be recalled on grounds of fraud or lack of jurisdiction without proper pleading.
Final Decision
The appeal is dismissed. The impugned order dated 14.02.2025 passed by NCLT Kochi Bench rejecting the recall application is upheld.
Law Points
- Recall of consent order
- Fraud must be specifically pleaded
- Lack of jurisdiction as ground for recall
- Rule 11 NCLT Rules 2016
- Rule 32 NCLT Rules 2016
Case Details
2024 LawText (NCLAT) (01) 86
Company Appeal (AT) (CH) (Ins) No. 323/2025
Justice Sharad Kumar Sharma (Member Judicial)
Mr. Arjun Suresh, Ms. Aarthi Rao
Mr. Ashique Ponnambaramparambath
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Nature of Litigation
Appeal against rejection of recall application in insolvency proceedings
Remedy Sought
Appellant sought recall of order dated 11.12.2024 passed by NCLT Kochi Bench
Filing Reason
Appellant alleged that the order dated 11.12.2024 was a consent order but he denied consent, claiming fraud and lack of jurisdiction
Previous Decisions
NCLT Kochi Bench rejected the recall application vide order dated 14.02.2025
Issues
Whether the impugned order rejecting the recall application was justified
Whether a consent order can be recalled on grounds of fraud or lack of jurisdiction without proper pleading
Submissions/Arguments
Appellant argued that the order dated 11.12.2024 was vitiated by fraud and passed without jurisdiction, hence liable to be recalled under Rule 11 read with Rule 32 of NCLT Rules, 2016
Appellant relied on Sri Budhia Swain vs Gopinath Deb (1999) 4 SCC 396 to support recall on grounds of fraud or lack of jurisdiction
Ratio Decidendi
A consent order cannot be recalled under Rule 11 of NCLT Rules, 2016 unless fraud or lack of jurisdiction is specifically pleaded and proved. Mere allegations without evidence are insufficient.
Judgment Excerpts
The ground, which has been agitated by the learned counsel for the Appellant while questioning the propriety of the impugned order, rejecting the recall application is that, when any proceedings vitiated by a fraud or is decided by a Tribunal which lacks jurisdiction to decide the matter, that will be falling well within the ambit of recall...
The learned counsel for the Appellant has further argued that, the recall of the order dated 11.12.2024 in IA/340/KOB/2023 became necessary owing to the fact that, the finding, which has been recorded therein, projects as if order has been passed by way of a consent, which is now a fact denied by Appellant.
Procedural History
The appellant filed a recall application (IA(IBC)27/KOB/2025) before NCLT Kochi Bench seeking recall of order dated 11.12.2024 passed in IA/340/KOB/2023. The NCLT rejected the recall application on 14.02.2025. Aggrieved, the appellant filed the present appeal before NCLAT Chennai.
Acts & Sections
- National Company Law Tribunal Rules, 2016: Rule 11, Rule 32
