NCLAT Refuses Restoration of Section 9 Petition Beyond 30 Days, Says Inherent Powers Cannot Override Statutory Limitation

April 8, 2026 : The National Company Law Appellate Tribunal (NCLAT) has declined to restore a Section 9 insolvency petition filed by V-Con Integrated Solutions Pvt. Ltd. against Shreeram Technology Services Pvt. Ltd., holding that statutory timelines under the NCLT Rules cannot be diluted by invoking inherent powers.

The Appellate Tribunal, in V-Con Integrated Solutions Pvt. Ltd. v. Shreeram Technology Services Pvt. Ltd. (Company Appeal (AT) (Insolvency) No. 283 of 2025), upheld the order of the NCLT, Indore Bench rejecting a restoration application filed with substantial delay.

A Bench comprising Justice N. Seshasayee (Judicial Member) and Technical Members Arun Baroka and Indevar Pandey emphasized that Rule 48(2) of the NCLT Rules, 2016 prescribes a strict 30-day limitation for filing restoration applications in cases dismissed for non-prosecution. The Tribunal held that such an express statutory mandate cannot be bypassed through recourse to inherent powers under Rule 11 or Rule 15.

The original Section 9 petition had been dismissed on March 25, 2022 due to repeated non-appearance by the operational creditor. However, the restoration application was filed only on August 13, 2022, after a delay of more than five months.

The appellant argued that the delay occurred because its counsel failed to inform it about the dismissal and contended that a litigant should not suffer for the fault of an advocate. It further relied on judicial precedents advocating a liberal approach in condonation of delay and argued that formal condonation applications are not mandatory.

Rejecting these submissions, the NCLAT held that the explanation offered did not constitute “sufficient cause” under the law. It observed that insolvency proceedings under the Insolvency and Bankruptcy Code, 2016 are inherently time-bound, and parties are expected to act with diligence.

The Tribunal further relied on the Supreme Court’s ruling in GLAS Trust Company LLC v. BYJU Raveendran & Ors. to reiterate that inherent powers can only be exercised in the absence of an express provision and cannot operate in conflict with statutory timelines.

Clarifying the scope of inherent jurisdiction, the Bench held that where a specific procedure and limitation period are prescribed, tribunals must adhere strictly to such provisions. It added that permitting restoration beyond the prescribed period would defeat the legislative intent of expeditious insolvency resolution.

The Tribunal also noted that the appellant had demonstrated prolonged non-prosecution even prior to dismissal and that the subsequent delay in seeking restoration reflected lack of due diligence. It held that liberal interpretation in condonation matters cannot extend to cases involving gross negligence, inaction, or absence of bona fides.

Accordingly, the NCLAT dismissed the appeal and affirmed that the restoration application filed beyond the statutory 30-day period was not maintainable.