Calling the situation “grim”, the Supreme Court has taken suo motu cognisance of delays by National Company Law Tribunal (NCLT) benches in approving resolution plans under the Insolvency and Bankruptcy Code (IBC).
A resolution plan is a statutory proposal aimed at reviving a distressed company through restructuring or takeover.
A bench of Justices J B Pardiwala and K V Viswanathan also flagged acute shortages of manpower and infrastructure across NCLT benches nationwide.
It said the issue must be addressed on a war footing, warning that continued delays could defeat the very purpose of the IBC.
It directed that the matter be placed before Chief Justice of India (CJI) Surya Kant for assigning it to an appropriate bench.
The bench perused the report placed before it by the NCLT principal bench, as per which 383 applications were awaiting approval of the resolution plans across the country, with delays ranging from over one month to over 700 days.
The top court passed the order while hearing two pleas against a 2023 order passed by the National Company Law Appellate Tribunal (NCLAT).
While hearing the matter on April 16, the apex court had observed that it had come to its notice that many approval applications were pending with the NCLT principal bench, New Delhi, and also other benches for the past several years.
It had asked the NCLT principal bench to place before it the details about how many applications for approval of resolution plans were pending, for how long such applications were pending and why the approval applications were not adjudicated upon till date.
The bench had also impleaded the Insolvency and Bankruptcy Board of India (IBBI) as a party respondent in the matter.
It had directed the IBBI to provide the necessary figures and statistics from across the country with regard to the queries posed by the court.
(With inputs from PTI)