The National Company Law Tribunal (NCLT), Kolkata Bench-II, has dismissed an application filed by the Karbi Anglong Autonomous Council (KAAC) seeking restoration of possession of a Kolkata property allegedly taken over by the Resolution Professional during the Corporate Insolvency Resolution Process (CIRP) of SIS Mohan Real Estate Pvt. Ltd., holding that disputes relating to title and ownership fall within the domain of the civil court and not the insolvency tribunal.
The application was filed under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, seeking a declaration that KAAC was the absolute owner of the property, restoration of possession and a direction restraining the Resolution Professional from taking any further steps in relation to it. KAAC claimed that it had purchased the property in November 2020 for ₹7.5 crore, well before initiation of CIRP against the corporate debtor, and alleged that the Resolution Professional had illegally taken possession despite it being a third-party asset.
The Resolution Professional opposed the application, contending that it was in substance a recall application disguised as an intervention petition, filed nearly five months after admission of the insolvency proceedings. It was argued that the applicant lacked locus to intervene in the main insolvency proceedings and that declaratory relief regarding title could not be granted by the NCLT. The RP further submitted that the resolution plan had already been approved by the Committee of Creditors and that the application appeared intended to stall the CIRP.
After examining the statutory framework under Section 18 of the IBC, the Tribunal observed that while an Interim Resolution Professional cannot take control of assets belonging to third parties held by the corporate debtor under trust or contractual arrangements, the present case stood on a different footing. The Tribunal noted that the property was recorded in the revenue records in the name of the corporate debtor and that Section 18 expressly permits the Resolution Professional to take custody of assets whose ownership is yet to be determined by a competent court or authority.
Relying on the Supreme Court’s decision in Gloster Ltd. v. Gloster Cables Ltd., 2026 INSC 81 the Bench reiterated that although the NCLT possesses wide residuary jurisdiction under Section 60(5)(c) of the IBC, it cannot adjudicate disputes that lie outside the insolvency process or usurp the jurisdiction of civil courts. Questions concerning title and ownership of immovable property, the Tribunal held, must be resolved by the appropriate civil forum.
Holding that the ownership claimed by KAAC could only be adjudicated by a civil court and that the Resolution Professional had rightly taken custody of the property based on the existing revenue records, the NCLT dismissed the application as not maintainable and devoid of merit. However, it clarified that nothing in the order would prejudice the applicant’s right to pursue any alternative remedy available in law before the competent forum.
