Civil Court lacks jurisdiction in matters pending before NCLT as per Insolvency and Bankruptcy Code.

JUDGMENT

This Original petition is filed by the petitioners, who are Defendant Nos.1 and 3, company and the liquidator of the company, challenging the impugned order passed by the Sub Court, Ernakulam, in I.A.No.3/2025 in O.S.NO.41/2025 by ad interim granting injunction against the petitioners and other respondents on the suit filed by the 1st respondent herein.

2. Heard the arguments of the learned counsel for the petitioners and the learned counsel for the respondents.

3. The case of the petitioners is that, the 1^st respondent filed a suit before the Sub Court, Ernakulam, for seeking permanent injunction against the defendants and other consequential reliefs in the suit. The 1^st respondent also application under Order 39 Rule 1 and 2 of the Code of Civil Procedure (CPC) numbered as I.A.No.3/2025, wherein the Sub ad interim Court passed temporary injunction against the petitioner, which is under challenge.

4. The learned counsel for the petitioners contended that, the 1^st petitioner and 3^rd petitioner was already parties in the NCLT. An insolvancy proceedings was also initiated before the NCLT, wherein, the NCLT passed an order in CP(IB)/29/KOB/2022, and subsequently a liquidation order also passed. Suppressing the same, the 1^st respondent against the company as well as the liquidator and obtained injunction where there is a bar for entertaining any suit as per Section 63 of the Insolvency and Bankruptcy Code, 2016 (IBC) and also as per Section 60 (5)(c) of the IBC, 2016. The National Company Law Tribunal (NCLT) is having jurisdiction to dispose of any application or any claim or any question of priorities before the NCLT, and the Civil Court are totally barred from entertaining any suit even under Section 231 of the IBC, and the Civil Court is barred for adjudicating litigation. Such being the case, the Civil Court has entertained the suit and passed the injunction which is a illegal order as against the statutory as also the judgment of the Supreme Court in various cases and hence prayed setting aside the same.

5. Per contra, the learned counsel for the respondents/plaintiffs has objected the petition contending that though the injunction order was granted by the Civil Court, the petitioners having liberty to approach and file an application before the same court under Order 39 Rule 4 CPC for vacating the interim order, or else it can also file a Civil Miscellaneous Appeal under Order 43 CPC. Without doing so, directly filed the original petition which is not maintainable, therefore, prayed for dismissal of the original petition. The counsel for the 1^st respondent as well as the 2^nd respondent contended that the order is only for restraining the defendant from taking interference without due process of law. Therefore, the order may not be set aside and the parties can permitted to approach the NCLT and put their relief for adjudication, therefore prayed for dismissal.

6. The counsel appearing for 3^rd respondent, who is not a party in the Civil Court has contended that the civil suit is barred and NCLT is taking cognizance and therefore, the very order is illegal and to be set aside.

7. Having heard the arguments perused the records. The points that arise for consideration are:

I. whether the Civil Court is having jurisdiction to entertain the suit, when the matter is pending before the NCLT?

II. whether order under challenge is called for interference?

8. On perusal of the records, admittedly, the suit is filed by the 1st respondent, where the petitioner is made as 1st defendant, 2^nd respondent as the 2^nd defendant and 2^nd petitioner as the 3^rd defendant, showing it liquidated but nothing is stated about the proc