The Supreme Court on Wednesday lamented the existing state of affairs in National Company Law Tribunals (NCLTs) across the country and expressed utter dismay over it. The apex court detected gaps in infrastructure, manpower, and supporting staff, which it said have been holding up approvals for resolution plans for years.
After perusing a report presented by the NCLT principal bench in New Delhi, a bench of justices JB Pardiwala and KV Viswanathan described the situation “grim and dismal.”
The bench directed the matter to be placed before Chief Justice of India (CJI) Surya Kant for assigning it to an appropriate bench.
The NCLT report showed 383 applications were pending across the country, waiting for approval of resolution plans, with the delay ranging from 48 days to 738 days.
Not only this, but the report also pointed out major infrastructural constraints that force the tribunal to sit for half a day. According to the report, even the staff assisting the benches are appointed on a contractual basis, and their salaries and other allowances have not been regularly paid.
The top court took suo motu cognisance of the matter in the larger public interest, remarking that the issues need to be addressed on a war footing or else the purpose of enacting the Insolvency and Bankruptcy Code (IBC) would stand frustrated.
The bench noted a serious manpower crunch across NCLT benches with a working strength of only 54 members (28 judicial and 26 technical) out of a sanctioned strength of 63. The court observed that there is an acute shortage of members, which is severely affecting the functioning of NCLT in a time-bound manner.
The court also took exception to the NCLT registrar being appointed on a contractual basis.
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