IBC Jurisdiction Depends On Debtor's Registered Office, Not Bank Branch That Issued Notices: NCLT Kochi

The National Company Law Tribunal (NCLT) at Kochi recently held that insolvency proceedings can be initiated only before the bench having jurisdiction over the place where the corporate debtor's registered office is located, and not based on the bank branch that issued demand or recovery notices. A coram comprising Judicial Member Vinay Goel said this while dealing with a jurisdictional objection raised by a Kerala based corporate debtor. Reaffirming its jurisdiction to settle the dispute, the tribunal observed that even though demand and recall notices were issued by Madurai branch of the bank, that factor was irrelevant. It observed, “For the purpose of determining jurisdiction to entertain an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, the location of the assets or the mortgaged property is irrelevant. Likewise, the issuance of a demand notice by any particular branch does not confer jurisdiction upon that branch to initiate the insolvency process. Jurisdiction is determined solely by the location of the registered office of the Corporate Debtor. Hence, there is no error in choosing the jurisdiction of the NCLT, Kochi Bench.” The insolvency plea was filed by South Indian Bank Ltd against Nellai Plantations Pvt Ltd. The company's registered office is at Mundakayam in Kottayam district, Kerala. The bank had sanctioned cash credit and term loan facilities totalling Rs 2.75 crore in December 2017, secured by hypothecation of standing crops and mortgage of immovable property. After repeated defaults, the accounts were classified as non-performing assets in May 2025. A recall notice dated June 5, 2025 and a SARFAESI demand notice dated July 23, 2025 were issued by the Madurai branch of the bank. The bank claimed outstanding dues of Rs 2.92 crore as on November 2025. The corporate debtor opposed the insolvency petition on several grounds. It argued that its plantations and secured assets were situated in Tamil Nadu and that earlier recall and demand notices had been issued by the bank's Madurai branch under the SARFAESI Act. On this basis, it claimed the Kochi bench lacked jurisdiction. It also contended that no demand notice under Sections 8 and 9 of the Insolvency Code had been issued before filing the petition, which, according to it, violated principles of natural justice. Rejecting these arguments, the tribunal held that Section 60 of the Code clearly fixes jurisdiction based on the location of the registered office of the corporate debtor. Since Nellai Plantations is registered in Kottayam, the Kochi bench was the proper forum. On the issue of notice, the tribunal clarified the such a notice is not required when the insolvency plea is maintained by a financial creditor. “The notice under Section 8 of the IBC, 2016, is required only for initiating proceedings under Section 9 of the IBC, 2016. There is no requirement to issue a notice under Section 8 of the IBC, 2016, for the initiation of proceedings under Section 7 of the IBC, 2016.”, it said. Finding that the debt and default were established, the tribunal admitted the petition, declared a moratorium, appointed Allen Bosco as interim resolution professional. It also directed the bank to deposit Rs 2 lakh towards CIRP costs. Case Title: South Indian Bank Ltd vs Nellai Plantations Pvt Ltd Case Number: CP(IBC)/38/KOB/2025 For Petitioner: Advocate KN Sivasankaran For Respondent: Advocate Vijayakumari R Click Here To Read/Download Order

IBC Jurisdiction Depends On Debtor's Registered Office, Not Bank Branch That Issued Notices: NCLT Kochi

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IBC Jurisdiction Depends On Debtor's Registered Office, Not Bank Branch That Issued Notices: NCLT Kochi

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