The Supreme Court on Thursday took up a rather unusual dispute concerning how the National Company Law Appellate Tribunal (NCLAT) should handle cases when its two-member bench delivers conflicting opinions. The matter surfaced in an appeal filed by R. Narayanasamy, challenging the striking off of Shree Laxmi Spinners Private Limited from the Register of Companies in Tamil Nadu. Notably, the Registrar of Companies did not appear despite being served notice.
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Background
The company had been struck off by the Registrar of Companies through a notification dated 31 August 2018 under Section 248(5) of the Companies Act, which deals with removal of non-functioning companies.
The promoter contested the strike-off before the National Company Law Tribunal (NCLT), but the plea was rejected. He then moved the NCLAT, where things became complicated.
Two NCLAT members heard the appeal but delivered opposite conclusions. One member said the strike-off was legally flawed, while the other believed the authorities acted correctly.
Since they disagreed, the case was sent to a third member, who ultimately upheld the strike-off.
This final affirmation led the promoter to approach the Supreme Court.
Court’s Observations
A bench of Justice J.B. Pardiwala and Justice K.V. Viswanathan heard the matter.
Senior Advocate V. R. Krishnan, appearing for the appellant, argued that referring the case to a third member was not the correct approach. Instead, he asserted, “the entire matter should have been re-heard by a three-member bench from the beginning, since no rule of procedure covers such a split situation.”
The bench appeared attentive to this procedural gap. One judge remarked, in a calm but pointed tone, “We are faced with a peculiar situation, which requires clarity on how the appellate tribunal should proceed when its members disagree.”
The court noted the practical difficulty: if tribunals lack a clear guideline on handling internal divisions, similar disputes may repeatedly land in the Supreme Court. The absence of the Registrar of Companies at the hearing only deepened the court’s concern.
Decision
To resolve the uncertainty, the court requested the Solicitor General of India to assist in defining or clarifying the proper legal procedure when an NCLAT bench is split.
The bench directed the Registry to share a copy of the order with the Solicitor General and also instructed the appellant’s counsel to formally notify him.
The matter has now been scheduled for further hearing on 19 November 2025.
Case: R. Narayanasamy v. Registrar of Companies, Tamil Nadu (Shree Laxmi Spinners Strike-Off Case)
Court: Supreme Court of India
Bench: Justice J.B. Pardiwala and Justice K.V. Viswanathan
Appellant: R. Narayanasamy (Promoter of Shree Laxmi Spinners Pvt. Ltd.)
Respondent: Registrar of Companies, Tamil Nadu (Coimbatore)
Date of Hearing: 30 October 2025