NCLT Rejects St. John Lines’ ₹35 Crore Claim Against Liquidator in St. John Freight Insolvency Case

June 5, 2026 : The National Company Law Tribunal (NCLT), Chennai Bench, has dismissed an application filed by Singapore-based St. John Lines PTE Limited seeking more than ₹35 crore from the liquidator of St. John Freight Systems Limited. The Tribunal held that the claims were raised at a belated stage of the liquidation process and were not supported by reliable documentary evidence. The ruling reinforces the principle that claims in insolvency proceedings must be submitted within the framework prescribed under the Insolvency and Bankruptcy Code (IBC), 2016.

The matter arose in IA/IBC/13/CHE/2025 filed in the ongoing insolvency proceedings of St. John Freight Systems Limited. The application was heard by a Division Bench comprising Judicial Member Jyoti Kumar Tripathi and Technical Member Ravichandran Ramasamy, which ultimately dismissed the plea on June 5, 2026.

According to the application, St. John Lines PTE Limited, a Singapore-incorporated step-down subsidiary of the company under liquidation, claimed that it had become the lessee of approximately 800 marine containers under amended lease agreements originally executed with Cronos Containers Limited, later assigned to Seaco Global Limited. The applicant alleged that during the Corporate Insolvency Resolution Process (CIRP) and subsequent liquidation, the liquidator failed to return the containers, continued to use them, and also allowed the use of the company’s Bills of Lading without authority. Based on these allegations, the company sought container rental charges of approximately ₹31.99 crore, Bill of Lading usage charges exceeding ₹3.04 crore, return of the marine containers in seaworthy condition, and transfer of revenue allegedly earned from their use, taking the total claim to over ₹35 crore.

The applicant further contended that it had suffered substantial commercial losses because the containers were allegedly not returned despite repeated demands. It also alleged that the liquidator failed to disclose the status and location of the containers and that the actions during CIRP adversely affected its international shipping operations, including regulatory scrutiny in Singapore. The company maintained that the corporate debtor had merely acted as its agent under an Agency Agreement and therefore had no ownership rights over the containers after amendments made in 2012.

The liquidator opposed the application, arguing that the corporate debtor had ceased to be the lessee of the containers from December 12, 2012, after the lease agreements were amended. It was submitted that the containers never formed part of the assets of the corporate debtor during CIRP or liquidation. Consequently, the Interim Resolution Professional, Resolution Professional and Liquidator were under no statutory obligation under Sections 18(1)(f) and 36(3) of the Insolvency and Bankruptcy Code, 2016, to take custody of those containers. The respondent also argued that the applicant had failed to pursue its claims through the insolvency process in the manner contemplated under the Code and had approached the Tribunal only after the corporate debtor had already been sold as a going concern.

After examining the documents and rival submissions, the Tribunal found that the reliefs claimed by the applicant could not be entertained at such an advanced stage of liquidation. The Bench observed that the applicant had admittedly filed a claim before the Resolution Professional, which had already been rejected. Since the corporate debtor had subsequently been sold as a going concern pursuant to an earlier NCLT-approved sale, the Tribunal held that reopening such claims at the liquidation stage was impermissible. The Bench observed, “At this belated stage of the liquidation process, the claims raised by the applicant… cannot be considered or entertained.”

The Tribunal also examined the merits of the applicant’s claim and concluded that the documentary evidence did not establish any enforceable right against the corporate debtor. It noted that the corporate debtor had ceased to be the lessee of the marine containers with effect from December 12, 2012, and there was no reliable material showing that it owned or lawfully possessed the containers when CIRP commenced in December 2018. The Bench further observed that “the material on record fails to substantiate any valid claim against the Corporate Debtor.”

A significant aspect of the Tribunal’s reasoning related to the Agency Agreement relied upon by the applicant. The respondent challenged the authenticity of the agreement, pointing out inconsistencies between different versions produced during the proceedings. After comparing both documents, the Bench found substantial discrepancies in signatures, seals and other particulars. The Tribunal remarked that the credibility of the later version was “highly questionable” and observed that it “appears that the subsequent document annexed to the rejoinder is created as an afterthought to cure the defects pointed out by the Respondent.” As the applicant’s case substantially depended upon this agreement, the Tribunal declined to place reliance on it.

The decision highlights the importance of timely submission of claims under the Insolvency and Bankruptcy Code, 2016. It also underscores that parties asserting rights over third-party assets during insolvency proceedings must establish their claims through credible and consistent documentary evidence. Once a corporate debtor has been sold as a going concern under an approved liquidation process, courts are generally reluctant to reopen claims that were either rejected earlier or not pursued in accordance with the statutory mechanism.

With these findings, the National Company Law Tribunal dismissed IA/IBC/13/CHE/2025, leaving the applicant without the reliefs sought against the liquidator in the insolvency proceedings of St. John Freight Systems Limited.

Case Reference: St. John Lines PTE Limited v. R. Venkatakrishnan (Liquidator of St. John Freight Systems Ltd.), IA/IBC/13/CHE/2025 in CP(IBC)/759/CHE/2018.