MCA seeks to add 50 NCLT courts and two NCLAT benches: Panel report

The Supreme Court, in one of its judgments, had said that a shortfall of members and the lack of requisite strength has led to tribunals only sitting for a few days of the week or a few hours in a day

The Corporate Affairs Ministry has sought the Cabinet’s approval for a proposal to have 50 more courts of the National Company Law Tribunal (NCLT) and two more for the appellate tribunal (NCLAT) for its approval. It shared the information with the Select Committee on the Insolvency and Bankruptcy Code Amendment Bill, 2025.

 

The Ministry told the Parliamentary committee it will draft regulations under the ‘Adjudicating Authority Rules for the IBC process’ to ensure that timelines are met. This would be done after “after carefully calibrating the infrastructure, functional and administrative requirements of Adjudicating Authorities,” it said.

 

The committee said in its report: “in order for the Adjudicating Authorities to adhere to the established timelines in letter and spirit, the relevant provisions would need buttressing with supporting regulation.”

   

Various stakeholders told the committee that there is a need for expanding judicial capacity or restructuring the adjudicatory process by increasing the number of benches and also enhancing financial allocation for improvement of infrastructure.

 

The total sanctioned strength of members, including president, in the NCLT is 63. As of March 31, 2025, only three positions were vacant at NCLT benches.

 

Under the IBC framework, an application initiating corporate insolvency resolution must be admitted within 14 days. However, adjudicating authorities take over a year on average in admitting applications.

 

A Supreme Court judgement had said that a shortage of members has led to tribunals only sitting for a few days of the week or a few hours in a day. The court added that even in tribunals where there is no vacancy, the absence of requisite infrastructure has forced the benches to share courtrooms or halls.

 

The proposed amendment in the IBC Bill for mandatory admission of an insolvency application filed by a financial creditor if a default is established and procedural requirements are met has tried to address this issue.

 

The select committee however, has suggested that the government should establish a clear statutory timeline for the NCLAT to dispose of an appeal within three months from the date of its receipt.

 

“Given that the effectiveness of the code [IBC] rests on a strict time-bound framework…undue appellate delays risk undermining the efficiency and certainty of the insolvency resolution process,” the committee’s report said.

 

Corporate insolvency cases are grappling with delays, according to data from the Insolvency and Bankruptcy Board of India. By September 2025, as many as 1,300 corporate insolvency resolution processes (CIRPs) were resolved in an average of 603 days, excluding court-mandated time extensions. A total of 2,896 CIRPs, which ended in orders for liquidation, took on average 518 days for conclusion.

 

From June 1, 2016 to March 31, 2025, a total of 97,457 cases have been disposed of by NCLT. Out of these, 44,486 cases pertain to IBC and 52,971 cases pertain to Companies Act, 2013.