Supreme Court Upholds NCLT's Decision on Case Transfer Application Judgment Criticizes Unjustified Attempts to Browbeat Tribunal Members; Leaves Legal Question Open for Further Deliberation
In a significant ruling, the Supreme Court of India has dismissed a special leave petition filed by Anitha Rayapati and others, which sought the transfer of cases from the National Company Law Tribunal (NCLT) Amravati Bench to the NCLT Hyderabad. The petitioners had argued that a Member (Technical) of the NCLT "threatened to vacate" an interim stay order, using this as a basis to seek the transfer. However, the apex court found this argument to be an unjustified attempt to influence the tribunal members.
The bench comprising Chief Justice of India, Surya Kant, and Justice Joymalya Bagchi emphasized that proceedings cannot be transferred on the mere basis of observations made by a presiding officer or a member during the course of a hearing. Such grounds, the court noted, if motivated, are insufficient for seeking a transfer of cases.
The case initially revolved around three matters titled Anitha Rayapati & Ors. v. BIT Corporation Pvt. Ltd., Anitha Rayapati & Ors. v. Tobacco Bye Products Pvt. Ltd. & Ors., and Anitha Rayapati & Ors. v. M/s. Gogeneni Tobaccos Limited & Ors. which were pending before the NCLT Amravati Bench. The President of NCLT had earlier disposed of the transfer application, a decision which the Supreme Court has now affirmed.
The Supreme Court's judgment has been welcomed as it sets a precedent against the misuse of transfer applications to apply undue pressure on tribunal members. While dismissing the special leave petitions, the Court has decided to keep a connected legal question open for further deliberation. This question was formulated by the High Court of Gujarat in its earlier judgment dated 16 October 2025, and the Supreme Court has issued a notice to address this specific legal issue in a separate proceeding.
The court’s decision underscores the principle that judicial proceedings should not be disrupted by baseless allegations against tribunal members, thereby protecting the integrity and efficiency of judicial processes. All pending applications related to the case have also been disposed of, marking the closure of this chapter in the legal saga.
Bottom Line:
Transfer of cases within NCLT - Proceedings cannot be transferred merely on the ground that the presiding officer or a member has made certain observations during the course of hearing. Such grounds, if motivated and unjustified, are not sufficient for seeking transfer of cases.
Statutory provision(s): National Company Law Tribunal Act, Special Leave Petition provisions, Judicial principles on case transfer.
