Supreme Court Overturns NCLAT Order: Rejoinder Admissibility in IBC Section 7 Applications Affirmed.
14 February 2025
Bankruptcy & Insolvency Law >> Business & Commercial Law
The Supreme Court has overturned an order of the National Company Law Appellate Tribunal (NCLAT), criticizing the National Company Law Tribunal (NCLT) for disallowing the State Bank of India (SBI) from relying on factual assertions in its rejoinder affidavit in a Section 7 application under the Insolvency and Bankruptcy Code (IBC). 
The Court held that both tribunals erred in taking a "technical or rather pedantic view," especially after condoning the delay in filing the rejoinder. Citing the precedent in Dena Bank vs. C. Shivakumar Reddy, the Court affirmed that additional documents and pleadings can be filed in Section 7 applications until a final order is passed. The Court directed the NCLT to reconsider SBI's Section 7 application afresh, allowing the rejoinder to be considered, and instructed the NCLAT to pass appropriate orders in the pending appeal against the NCLT's rejection of the Section 7 application, consistent with this judgment.