Can NCLT President transfer cases to NCLT benches in other states? Supreme Court to examine

The Supreme Court on Monday indicated that it would examine the scope of the National Company Law Tribunal (NCLT) President’s power to transfer cases across NCLT benches in different states [Anitha Rayapati v. Arcelor Mittal Nippon Steel India]..The matter was heard by a Bench of Chief Justice of India Surya Kant and Justice Joymalya Bagchi..The controversy stems from Rule 16(d) of the NCLT Rules, 2016, which allows the NCLT President to "transfer any case from one Bench to another Bench when the circumstances so warrant".A recent Gujarat High Court ruling held that this power is strictly intra-state. The High Court argued that the President cannot "alter or extend" territorial jurisdiction established by the Central government, meaning that cases cannot be moved from one state to another.The Supreme Court today "prima facie doubted" this stance, noting that if a member must recuse at a location with only one bench, a transfer across state lines might be the only way to avoid a total standstill to proceedings..The Court made the observation while hearing petitions filed in the dispute pertaining to ArcelorMittal Nippon Steel India Limited.Two NCLT benches at Ahmedabad had earlier recused from hearing cases concerning ArcelorMittal, following which the NCLT President at Delhi passed an administrative order transferring the matter to Mumbai instead. Subsequently, the Mumbai Bench also recused. Both the Benches, in their written order, had stated that they were recusing on account of the behaviour of Advocate Deepak Khosla. ArcelorMittal challenged the NCLT’s recusal and transfer orders as being contrary to the NCLT Rules and alleged that they were the result of bench hunting and forum shopping by certain respondents.Setting aside all five orders under challenged, the Gujarat High Court directed the President of NCLT Delhi to re-allot the cases to any bench at Ahmedabad or, if necessary, to constitute a virtual bench for expeditious adjudication."It is increasingly being observed that when judicial officers do not align with the expectations of certain litigants, attempts made to browbeat or pressurize them to avoid the passing of unfavourable orders. Such conduct cannot be tolerated. Judicial magnanimity should never be mistaken for weakness. Courts and Tribunals are not powerless to deal with such situations; they possess ample authority to take appropriate action against such misconduct. Therefore, instead of resorting to recusal in such circumstances, the proper course would be to take firm and lawful measures against the wrongdoers," the High Court had said..During today's hearing, the Bench headed by CJI Kant questioned the premise that tribunal members should recuse in the face of threats or litigant pressure.“Why can't the tribunal members recuse? The tribunal should come heavily on the party which does it. A party which threatens a tribunal can't get away with it,” the Court said.The Bench also questioned the rigidity underlying the approach adopted in the Gujarat High Court ruling that has been relied on to shut out transfer requests.“What is the business of the High Court to cut in the powers of the tribunal like this?” the Court asked.When counsel responded that the High Court’s concern was why the matter was transferred to Mumbai and that it suggested a virtual bench instead, the Bench tested the issue through a hypothetical where recusal makes hearing impossible at a given bench:“First, let us forget about that there are two benches, assuming that there is only one bench at one place. And one of the members on account of conflict of interest, let us assume, he has to recuse. Therefore, in that place, the matter cannot be heard. So it has to go from Ahmedabad...to A place, B place or C place.".The case is now expected to be heard on February 23, 2026. .ArcelorMittal was represented by Senior Advocate Neeraj Kishan Kaul..Follow Bar and Bench channel on WhatsAppDownload the Bar and Bench Mobile app for instant access to the latest legal news.