NCLT Alone Can Punish Contempt Of Its Orders | HC

Case Details: S.G. Mittal Enterprises (P.) Ltd. vs. Satara Sahakari Bank Ltd. - [2026] 182 taxmann.com 566 (HC - Bombay)

Judiciary and Counsel Details

• Milind N. Jadhav, J.
• Amit Singh, Ms. Shivani Deshmukh & Ms. Shraddha Nagaonkar for the Petitioner.

Facts of the Case

In the instant case, the petitioner/Corporate Debtor and the respondent No. 1/Bank agreed to settle the dispute amicably and thereafter settled it by agreeing to pay a certain amount and, in that regard, executed and signed the Consent Terms.

The NCLT took Consent Terms on record and disposed of the proceedings filed by respondent No. 1/Bank against petitioner vide order in terms of the Agreement. The petitioner made payment of the entire consideration in accordance with the schedule set out in the Consent Terms.

However, despite receiving the full agreed-upon settlement amount, the respondent No. 1/Bank, by letter, demanded payment of the alleged balance, thereby disregarding the Consent Term and the NCLT’s order. Thereafter, the petitioner filed the present Contempt petition.

It was noted that the NCLT and NCLAT have independent and effective jurisdiction to punish for contempt of their own orders, including orders passed while exercising jurisdiction under IBC and once such contempt jurisdiction is vested in the Tribunal, the High Court ought not to exercise parallel contempt jurisdiction under section 10 of the Contempt of Courts Act, 1971.

Further, it was noted that contempt jurisdiction is plenary and self-contained and once contempt powers are conferred by statute, they vest in the Tribunal as an institution and apply to all proceedings before it, irrespective of whether the Tribunal is exercising jurisdiction under the Companies Act, IBC, or any other law for the time being in force.

High Court Held

The High Court observed that contempt proceedings cannot be used as a substitute for the execution or enforcement of orders, nor for resolving disputes arising from Consent Terms, especially when compliance depends on disputed facts or interpretation; in such cases, contempt jurisdiction may not be appropriate.

The High Court held that any supervisory intervention, if required, can be exercised only under Articles 226 and 227 of the Constitution of India, and such supervisory jurisdiction is distinct from contempt jurisdiction and cannot be invoked by filing a Contempt Petition. Therefore, the present Contempt Petition was not maintainable at the threshold and was liable to be dismissed.

List of Cases Referred to

• Gujarat Urja Vikas Nigam Ltd. v. Amit Gupta [2021] 125 taxmann.com 150 (SC)/[2021] 167 SCL 241 (SC) (para 10.3)
• Delhi Judicial Service Association, Tis Hazari Court, Delhi v. State of Gujarat (1991) 4 SCC 406 (para 10.4)
• L. Chandra Kumar v. Union of India 1997 taxmann.com 1023 (SC) (para 10.5)
• S.K. Sarkar, Member, Board of Revenue, U.P. v. Vinay Chandra Misra (1981) 1 SCC 436 (para 10.6)
• Shailendra Singh v. Nisha Malpani (Resolution Professional) [2021] 133 taxmann.com 346 (NCL-AT) (para 10.7)
• Tinsukhia Electric Supply Company Limited v. State of Assam (1989) 3 SCC 709 (para 24)
• Dr. Subramanian Swamy v. Arun Shourie (2014) 12 SCC 344 (para 25).