S G Mittal Enterprises Pvt Ltd. Thr ... vs The Satara Sahakari Bank Ltd. And Ors.
2026 Latest Caselaw 10 Bom

Bombay High Court

S G Mittal Enterprises Pvt Ltd. Thr ... vs The Satara Sahakari Bank Ltd. And Ors. on 5 January, 2026

Author: Milind N. Jadhav

Bench: Milind N. Jadhav

2026:BHC-AS:180
                                                                                    CP.497.2025.doc

  Ajay

                          IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                          CIVIL APPELLATE JURISDICTION

                                  CONTEMPT PETITION NO.497 OF 2025

             S.G. Mittal Enterprises Private Limited            .. Petitioner
                  Versus
             The Satara Sahakari Bank Ltd. and Others           .. Respondents
                                           ....................
              Mr. Amit Singh a/w Ms. Shivani Deshmukh and Ms. Shraddha
                Nagaonkar i/b M. Mulla Associates, Advocate for Petitioner.
              None appears for Respondents.
                                                                 ....................
                                                  CORAM        : MILIND N. JADHAV, J.
                                                  DATE         : JANUARY 05, 2026.
             JUDGMENT:

1. Heard Mr. Singh learned Advocate for Petitioner. None

appears for Respondents.

2. The present Contempt Petition is filed by Petitioner against

Respondents for breach of Consent Terms filed before the National

Company Law Tribunal, Mumbai (for short "NCLT") in an Application

under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for

short "IBC") initiated by Respondent No.1 - Bank i.e. Corporate Debtor

against Petitioner.

3. On 11.07.2025, Respondent No.1 - Bank provided a Cash

Credit Facility to Petitioner. On 09.08.2023, Respondent No.1 - Bank

filed Company Petition (IB) No.1073 (MB) 2023 against Petitioner due

to an alleged default.

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4. Around 09.08.2023 to 13.11.2023, Petitioner and

Respondent No.1 - Bank engaged in settlement talks and reached an

understanding regarding the repayment of the financial debt.

5. On 04.10.2024, Petitioner and Respondent No.1 - Bank

agreed to amicably settle the dispute and thereafter settled it by

agreeing to payment of Rs.5,71,07,504/- and in that regard executed

and signed the Consent Terms.

6. On 18.04.2024, NCLT took Consent Terms on record and

disposed the proceedings filed by Respondent No.1 - Bank against

Petitioner vide order dated 18.04.2024 in terms of the Agreement.

7. It is Petitioner's case that it made payment of entire

consideration in accordance with the schedule set out in the Consent

Terms. On 30.12.2024, Petitioner requested Respondent No.1 - Bank

to issue a "No Dues Certificate". However, on 04.01.2025, despite

receiving the full agreed-upon settlement amount, Respondent No.1 -

Bank with its letter demanded payment of alleged balance amount of

Rs. 18,57,061.47/- thereby disregarding the Consent Term and the

NCLT's order.

8. It is Petitioner's case that it responded to Respondent No.1 -

Bank's letter and further issued two letters dated 15.01.2025 and

07.02.2025 to Respondent No.1 - Bank as a final reminder. It is

Petitioner's case that Respondent No.1 -Bank incorrectly reported the

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credit information of Petitioner to Respondent No.4 - TransUnion

CIBIL Limited and indicated an outstanding amount of

Rs.1,78,62,587/- towards Cash Credit Account and hence the said

erroneous reporting led to holding up Petitioner's loan Application

processed by Bank of Baroda.

9. Being aggrieved, Petitioner filed the present Contempt

Petition.

10. Mr. Singh, learned Advocate for Petitioner would submit that

despite complete compliance by Petitioner, Respondent No.1 - Bank

failed and neglected to issue a "No Dues Certificate" in breach of the

Consent Terms and the order passed by the NCLT. He would submit

that Respondent No.1 - Bank sought to justify its non-compliance by

contending that an amount of Rs.18,57,061/- allegedly remained

outstanding and asserted that no waiver of principal amount could be

granted. He would submit that such a contention is wholly

impermissible in law as Respondent No.1 - Bank is bound by the

Consent Terms which stood accepted by a judicial order and has

attained finality. Hence in the aforesaid circumstances, he would

submit that Petitioner has invoked the contempt jurisdiction of this

Court under Section 10 read with Section 12 of the Contempt of Courts

Act, 1971 and Article 215 of the Constitution of India.

10.1. In this regard issue which arises for consideration is whether

the High Court has parallel jurisdiction to entertain a Contempt

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Petition for non-compliance of orders passed by the NCLT under the

provisions of the IBC. Mr. Singh would submit that the IBC does not

confer any independent powers upon the NCLT and therefore it is

necessary to examine the parent legislation namely the Companies Act,

2013, under which the NCLT is constituted. He would submit that

although several provisions of the Companies Act were amended post

enactment of the IBC, Section 425 of the Companies Act deals with

contempt powers which was consciously left unamended in so far as

the IBC is concerned. He would submit that such legislative omission is

deliberate and demonstrates that the legislature never intended to

confer contempt jurisdiction upon the Adjudicating Authority i.e. NCLT

functioning under the IBC.

10.2. He would submit that whenever the legislature intended to

harmonise or modify the Companies Act to accommodate the IBC

framework it carried out express amendments as reflected in Schedule

XI of the IBC. He would submit that the absence of any amendment to

Section 425 to include contempt jurisdiction in relation to IBC

proceedings clearly indicates legislative intent to exclude such powers.

He would submit that settled principles of statutory interpretation

mandate that Courts cannot supply omissions or confer jurisdiction by

implication where the legislature has consciously refrained from doing

so. Hence, he would submit that contempt jurisdiction under Section

425 of the Companies Act remains confined strictly to proceedings

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under the Companies Act and therefore cannot be extended to IBC

proceedings.

10.3. He would submit that the scheme of the IBC itself reinforces

this position as Sections 60 to 64 create a complete adjudicatory and

appellate framework without conferring any powers to try for

contempt of its orders upon the NCLT. He would submit that the

residuary jurisdiction under Section 60(5) of the IBC even though

being wide is however limited to disputes arising out of or in relation

to Insolvency Resolution and cannot be stretched to include penal

contempt proceedings. In support of his submissions he has referred to

and relied upon the decision of the Supreme Court in the case of

Gujarat Urja Vikas Nigam Limited Vs. Amit Gupta and Others 1 wherein

the Court held that NCLT owes its existence to statute and can exercise

only such powers as are expressly conferred upon it by the IBC.

Therefore, he would submit that contempt jurisdiction being penal in

nature cannot be inferred or implied and must be expressly conferred

by statute.

10.4. He would submit that it is settled law that Tribunals

constituted under statute possess limited jurisdiction unlike

Constitutional Courts. In support of this submission he has referred to

and relied upon the decision of the Supreme Court in the case of Delhi

Judicial Service Association, Tis Hazari Court, Delhi Vs. State of

1 (2021) 7 SCC 209

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Gujarat and Others2 wherein the Court held that Courts and Tribunals

cannot assume contempt jurisdiction unless expressly provided by law.

10.5. He would further refer to and rely upon the decision of

Supreme Court in the case of L. Chandra Kumar Vs. Union of India and

Others3 wherein it is held that Tribunals are supplemental to

Constitutional Courts and remain subject to the supervisory jurisdiction

of High Courts under Articles 226 and 227 of the Constitution of India.

He would therefore submit that once such supervisory jurisdiction

exists the High Court retains the authority to enforce compliance with

Tribunal orders through its contempt jurisdiction unless expressly

barred.

10.6. He would submit that Section 10 of the Contempt of Courts

Act, 1971 empowers the High Court to punish contempt of

Subordinate Courts and Tribunals "judicially subordinate" to the High

Court which fall within its ambit. In support of this submission he has

referred to and relied upon the decision of the Supreme Court in the

case of S.K. Sarkar, Member, Board of Revenue, U.P., Lucknow Vs.

Vinay Chandra Misra4 wherein the expression "court subordinate" is of

wide amplitude and includes Tribunals even where administrative

control does not vest with the High Court. He would submit that

Section 22 of the Contempt of Courts Act makes it clear that the Act is

2 (1991) 4 SCC 406 3 (1997) 3 SCC 261 4 (1981) 1 SCC 436

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in addition to and not in derogation of other laws relating to contempt.

10.7. He would submit that the decision of the NCLAT in

Shailendra Singh Vs. Nisha Malpani and Another5, held that the NCLT

has contempt jurisdiction even under the IBC however it does not lay

down the correct proposition of law as it overlooks the statutory

scheme and the settled principle that contempt jurisdiction must be

expressly conferred. He would however submit that in any event the

said decision is not binding on this Court.

10.8. He would submit that in view of the statutory scheme of the

IBC, the legislative omission to confer contempt jurisdiction upon the

Adjudicating Authority and the settled principles of law laid down by

the Supreme Court, the NCLT lacks jurisdiction to entertain contempt

proceedings in respect of orders passed under the IBC. He would

submit that this Court being a Constitutional Court of record and

exercising supervisory jurisdiction over the NCLT is therefore fully

empowered under Section 10 read with Section 12 of the Contempt of

Courts Act, 1971 and Article 215 of the Constitution of India to take

cognizance of and punish contempt arising from non-compliance of

NCLT orders. Hence, he would urge the Court to hear and adjudicate

the present Contempt Petition in the interest of justice.

5 National Company Law Appellate Tribunal at New Delhi, Company Appeal (AT) (INS) No.945 of 2020

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11. I have heard Mr. Singh, learned Advocate for Petitioner and

perused the record of the case. Submissions made by learned Advocate

have received due consideration of the Court.

12. The preliminary question which arises before me for

consideration is on the maintainability of the Contempt Petition in this

Court to punish for contempt of an order passed by the NCLT under

the IBC. In effect, the question to be determined at the outset is

whether this Court can exercise contempt jurisdiction in respect of an

alleged breach of Consent Terms recorded by the NCLT in proceedings

under the IBC or whether such jurisdiction vests exclusively with the

Tribunal itself?

13. Mr. Singh has not only restricted his submissions to the

power of this Court to try for Contempt but argued further that this

Court will have parallel power to punish for contempt along wtih the

NCLT or NCLAT since the IBC does not specifically stipulate power to

punish for contempt.

14. It is well settled law that contempt jurisdiction is

extraordinary, penal and coercive in nature and such power cannot be

exercised on considerations of equity or convenience nor can it be

assumed by implication. The authority to punish for contempt must be

clearly traceable to a constitutional or statutory source and must be

exercised strictly within those limits.

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15. In this backdrop, it is necessary to refer to Section 425 of the

Companies Act, 2013 which assumes central significance. It reads as

under :-

"425. Power to punish for contempt.-- The Tribunal and the Appellate Tribunal shall have the same jurisdiction, powers and authority in respect of contempt of themselves as the High Court has and may exercise, for this purpose, the powers under the provisions of the Contempt of Courts Act, 1971(70 of 1971),which shall have the effect subject to modifications that--

(a) the reference therein to a High Court shall be construed as including a reference to the Tribunal and the Appellate Tribunal; and

(b) the reference to Advocate-General in section 15 of the said Act shall be construed as a reference to such Law Officers as the Central Government may, specify in this behalf."

16. From the above it is seen that the said provision categorically

stipulates that the Tribunal (NCLT) and the Appellate Tribunal

(NCLAT) shall have the same jurisdiction, powers and authority in

respect of contempt of themselves as the High Court has and for this

purpose exercise powers under the Contempt of Courts Act, 1971

subject to specified statutory modifications. The contempt jurisdiction

under Section 425 is plenary and self-contained. It is neither

conditional nor limited by the source of jurisdiction exercised by the

Tribunal. Once contempt powers are conferred by statute, they vest in

the Tribunal as an institution and apply to all proceedings (emphasis

supplied) before it irrespective of whether the Tribunal is exercising

jurisdiction under the Companies Act, the IBC, or any other law for the

time being in force.

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17. It is further seen that Section 425 of the Companies Act

makes no distinction between proceedings under the Companies Act

and those under any other enactment. Reading such a restriction into

the provision would amount to adding words to the statute which is

impermissible in law.

18. Section 408 of the Companies Act, 2013 reinforces this

position. It provides for the constitution of the NCLT and mandates

that the Tribunal shall exercise powers and functions conferred upon it

under the Companies Act or any other law in force. The NCLT

therefore derives its existence, continuity and authority from the

Companies Act, 2013.

19. It is seen that even though the IBC does not create a separate

adjudicatory forum however it merely designates the already

constituted NCLT as the Adjudicating Authority for insolvency matters.

It is clear that the IBC is a subject-based legislation whereas the

Companies Act is the parent statute constituting the Tribunal. Both

enactments are inter-connected, co-existent and are required to be

therefore read harmoniously since their legal domain is not

interconnected but co-existent. It would be therefore bizarre to

postulate that any adjudicating authority will have contempt

jurisdiction under one statute but is barred or will not be able to

exercise it under another statute.

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20. In this regard, attention is also drawn to Section 60(5) of the

IBC which begins with a non-obstante clause wherein it confers wide

jurisdiction upon the NCLT to entertain or dispose of any application,

question of law or fact arising out of or in relation to insolvency

resolution or liquidation proceedings. This provision reinforces the

legislative intent to vest the NCLT with comprehensive authority over

all matters connected with insolvency proceedings.

21. It is pertinent to note that Rule 11 of the National Company

Law Tribunal Rules, 2016 expressly saves the inherent powers of the

Tribunal to pass such orders as may be necessary for meeting the ends

of justice or to prevent abuse of the process of the Tribunal. Though

inherent powers cannot substitute statutory contempt powers however

they underscore the legislative intent that the Tribunal must remain an

effective and authoritative adjudicatory body.

22. In the case of Committee of Creditors of Essar Steel India

Limited (supra) it is seen that the Supreme Court held that the

jurisdiction of the NCLT and the NCLAT is circumscribed by the IBC

read in conjunction with the Companies Act, 2013, and that the

Tribunal functions within a complex statutory framework created by

both enactments. The Court however did not treat the NCLT as a

different or fragmented forum while exercising jurisdiction under the

IBC. On the contrary, it recognised the Tribunal as a singular

adjudicatory institution entrusted with ensuring that the insolvency

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resolution process is conducted in a lawful, disciplined and effective

manner and that its orders are enforceable and final.

23. Attention is further drawn to the decision of the Supreme

Court in the case of Gujarat Urja Vikas Nigam Limited (supra) wherein

the Court categorically held that the NCLT and the NCLAT owe their

existence to both the the Companies Act, 2013 and IBC. The Supreme

Court rejected any compartmentalisation of the Tribunal's jurisdiction

based on the statute invoked. Therefore, once it is held that the

Tribunal derives its authority, purpose and jurisdiction from two inter-

connected statutes, it would be in incongruity to hold that the same

Tribunal possesses contempt jurisdiction under one statute but stands

divested of such power under another. An adjudicating authority

cannot be attributed with a split or fragmented personality. An

adjudicating authority cannot be said to function with divided powers.

24. The doctrine of effectiveness also applies to the present case.

Attention is invited to the decision of the Supreme Court in the case of

Tinsukhia Electric Supply Company Limited v. State of Assam and

Others6, wherein the Court held that statutory provisions must be

interpreted to give them meaningful effect and to advance their

purpose rather than to render them ineffective.

25. In the case of Dr. Subramanian Swamy v. Arun Shourie7 the

Supreme Court adopted a purposive interpretation of the expression 6 1989 (3) SCC 709 7 2014 (12) SCC 344

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"court" under the Contempt of Courts Act, 1971 and held that an

authority which delivers definitive judgments, regulates legal rights

and follows judicial procedure qualifies as a Court. In the present

circumstances the NCLT definitely satisfies these requirements.

26. In view of the clear statutory power conferred under Section

425 of the Companies Act, 2013, read with the decisions of the

Supreme Court, the NCLT and the NCLAT have independent and

effective jurisdiction to punish for contempt of their own orders,

including orders passed while exercising jurisdiction under the IBC.

Hence, once such contempt jurisdiction is vested in the Tribunal, this

Court ought not to exercise parallel contempt jurisdiction under

Section 10 of the Contempt of Courts Act, 1971. It is therefore clear

that entertaining contempt petitions directly before the High Court

would allow parties to bypass the forum expressly empowered by the

statutes.

27. In this regard, it is useful to refer to the Statement and

Objects and Reasons (SOR) of the Insolvency and Bankruptcy Code

Bill, 2016 as regards the designation of the Adjudicating Authority

which reads as under:-

"3. The Code seeks to provide for designating the NCLT and DRT as the Adjudicating Authorities for corporate persons and firms and individuals, respectively, for resolution of insolvency, liquidation and bankruptcy. The Code separates commercial aspects of insolvency and bankruptcy proceedings from judicial aspects..."

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28. From the aforesaid Object and Reasons of the Insolvency &

Bankruptcy Code Bill, 2016 it is quite clear that the National Company

Law Tribunal is to act as an "Adjudicating Authority" for the purpose of

matters pertaining to the IBC.

29. Further it is necessary to refer to Section 424(3) of the

Companies Act, 2013 wherein it is stated that any order made by the

Tribunal may be enforced in the same manner as if it was a 'decree'

made by a Civil Court in 'suit' before it and the 'Tribunal' may either

enforce and order itself or may send it for execution to the Court

within (a) local limits of whose jurisdiction the registered office of the

company is situated in case the order is against the company, or (b)

the person concerned voluntarily resides or carries on business, in case

the order is against any such person.

30. Section 425 of the Companies Act, 2013 confers powers on

the 'Tribunal' (NCLT) to punish for 'Contempt'. The language

employed in Section 425 of the Companies Act, 2013 is that the power

of the Contempt of Courts Act, 1971 are vested with the NCLT while

adjudicating all proceedings that come before it. In this regard, it is

necessary to consider the ingredients of Section 425 of the Companies

Act, 2013 which do not mention that the provisions of power under the

Contempt of Courts Act, 1971 are applicable only in respect of

proceedings before 'Tribunal' confined to the provisions of Companies

Act, 2013.

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31. Under the IBC, the Adjudicating Authority (NCLT)

adjudicates all proceedings before it and renders its decision. Only

because the IBC does not specifically mention about the contempt

provisions it cannot be said that the 'Adjudicating Authority' (NCLT)

has no powers of contempt. If one is to give such a restricted

interpretation that the Adjudicating Authority (NCLT) has no

jurisdiction of contempt then its orders will be implemented and in

fact, the IBC would be reduced to a paper tiger, existing only in form

but devoid of any real force or enforceability.

32. It cannot be gainsaid that the 'Tribunals' are created under a

relevant 'Statute' to decide upon the disputes arising under the said

'Statute' or dispose of a particular category. Fact of the matter is that

'Courts' which are established by the 'State's' concerned are entrusted

with the 'States' inherent judicial powers for 'Administration of Justice'

in general. Moreover, the Tribunal can regulate their own procedure.

As per Section 430 of the Companies Act, 2013 the 'National Company

Law Tribunal' has the exclusive jurisdiction to deal with the disputes

arising under the Act, thereby meaning that the jurisdiction of the Civil

Court is ousted.

33. The purpose of 'punishment' under 'Contempt jurisdiction' is

not only curative but also 'corrective'. It will be a travesty of justice if

the Tribunals are to permit 'gross contempt of court' to go 'unpunished'

particularly in the absence of any mitigating circumstances.

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34. Also, it is necessary to be made clear that contempt

proceedings cannot be used as a substitute for execution or

enforcement of orders nor for resolving disputes arising from Consent

Terms, especially when compliance depends on disputed facts or

interpretation and in that case contempt jurisdiction may not be

appropriate.

35. As regards the jurisdiction of this Court is concerned, it is

clarified that any supervisory intervention if required can be exercised

only under Articles 226 and 227 of the Constitution of India. However,

such supervisory jurisdiction is distinct from contempt jurisdiction and

cannot be invoked by filing a Contempt Petition. Hence, in that view of

the matter, I am of the considered opinion that the present Contempt

Petition is not maintainable at the threshold and is liable to be

dismissed.

36. Resultantly, the Contempt Petition is dismissed. However,

Petitioner is at liberty to initiate or pursue any appropriate proceeding

available to it strictly in accordance with law.

37. Contempt Petition is dismissed.

                                                                                  [ MILIND N. JADHAV, J. ]

      Ajay


AJAY       TRAMBAK
TRAMBAK    UGALMUGALE
UGALMUGALE Date: 2026.01.06
              17:07:04 +0530




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