Summary
The Court held that NCLT lacked jurisdiction to review Karnataka’s statutory refusal to extend a mining lease, permitting the High Court to entertain a writ despite an available NCLAT appeal. Insolvency jurisdiction and the resolution professional’s asset-preservation duties did not confer public-law judicial review or create a renewal right through moratorium. By contrast, NCLT and NCLAT could examine fraudulent initiation of insolvency proceedings; that allegation alone did not justify bypassing the statutory appeal.
Issues
- Whether the High Court could review NCLT’s mining-lease directions despite the statutory appeal.
- Whether NCLT’s insolvency jurisdiction extended to review of the government’s mining decision.
- Whether alleged fraudulent initiation of CIRP was within NCLT and NCLAT jurisdiction.
Provisions considered
- Section 60(4) and (5), Insolvency and Bankruptcy Code, 2016The insolvency jurisdiction did not authorise judicial review of the government’s public-law mining-lease decision. (¶¶ 31, 32, 33, 34, 35, 36, 40, 45, 52)
- Sections 18(f)(vi) and Explanation; 25(1) and (2)(b), Insolvency and Bankruptcy Code, 2016Asset-preservation and representation duties required pursuit of rights before the competent forum rather than enlarging NCLT jurisdiction. (¶¶ 38, 39, 40)
- Section 65, Insolvency and Bankruptcy Code, 2016Fraudulent or malicious initiation of CIRP was within the adjudicating authority’s inquiry power, and did not itself warrant bypassing appeal. (¶¶ 49, 50, 51, 52)
Held
- Lack of jurisdiction remained distinct from erroneous exercise of an existing power when deciding whether to bypass a statutory remedy. The former could justify writ intervention, while mere legal error did not automatically do so. (¶¶ 15, 18, 21, 22, 23, 24, 25)
- The mining-lease relationship was statutorily governed and involved public-law decisions. NCLT was a statutory tribunal, not a superior court exercising judicial review, and Section 60(5) could not be stretched to cover all public-law disputes affecting the debtor. (¶¶ 26, 27, 28, 29, 30, 31, 36)
- A resolution professional’s duty to preserve assets did not determine NCLT’s jurisdiction. External judicial or quasi-judicial remedies could not be short-circuited, and a party’s concession could not supply missing jurisdiction. (¶¶ 37, 38, 39, 40, 41, 42, 43)
- The moratorium preserved status quo rather than creating a right to lease renewal. The nature of this mining grant also did not establish exclusive possession attracting the asserted protection against dispossession. (¶¶ 44, 45)
- NCLT and NCLAT could inquire into alleged fraudulent initiation and fraudulent transactions. Alleged collateral use of CIRP to obtain the mine fell within Section 65, so fraud alone was not a basis to bypass appeal. Writ intervention was justified by the separate jurisdictional defect in the mining directions. (¶¶ 46, 47, 48, 49, 50, 51, 52)
Result
Appeals dismissed; High Court’s entertainment of the writ and impugned interim intervention left undisturbed. NCLT lacked jurisdiction to direct supplemental mining-lease deeds by reviewing the statutory refusal, while insolvency-fraud questions remained within NCLT/NCLAT jurisdiction. No costs.