NCLT Allahabad Defers Deposit Repayment Proceedings Under RBI Act Amid Subsisting High Court Injunction

Background

The National Company Law Tribunal, Allahabad Bench (Prayagraj) has disposed of CP No. 190/ALD/2020, filed under Section 45QA of the Reserve Bank of India Act, 1934, seeking repayment of alleged deposits, in view of a subsisting interim injunction passed by the Allahabad High Court restraining recovery.

The petition was filed by Madhusudan Vehicles Private Limited, an authorised dealer of Maruti Suzuki engaged in vehicle sales and allied services, against Shivam Traders and Hire Purchase Private Limited, a non-deposit-accepting NBFC registered under the RBI Act. Jurisdiction was invoked under Section 45QA, which empowers the Tribunal to direct repayment of deposits by NBFCs upon default.

The Petitioner contended that it had placed deposits aggregating ₹20.25 crore with the Respondent at 8% per annum, repayable at the end of the financial year, pursuant to an oral arrangement. It was asserted that despite partial repayments, a substantial amount remained outstanding. As per the Petitioner’s computation, the total outstanding (including accrued interest) stood at ₹21.64 crore as on 31 August 2020.

Repeated demands for repayment through letters, emails, and complaints to the Reserve Bank of India allegedly yielded no result, prompting the Petitioner to approach the NCLT seeking a direction for repayment of principal along with interest.

The Respondent raised a multi-pronged challenge to the maintainability of the petition. It argued that:

● The transaction was not a “deposit” but a long-term inter-corporate loan governed by a written agreement dated 4 April 2019, with a nine-year tenure ending in 2028, and therefore not repayable on demand.

● Section 45QA of the RBI Act applies only to “deposits” as defined under the Act, and inter-corporate transactions fall outside its scope.

● The petition suffered from procedural defects, including failure to annex deposit receipts and to disclose essential terms as mandated under the NCLT Rules.

● Parallel proceedings were already pending, including oppression and mismanagement petitions and a civil suit, making the present petition an abuse of process.

During the pendency of the NCLT proceedings, the Respondent instituted Civil Suit No. 03/2021, wherein an interim injunction was granted restraining recovery. Although the suit was later dismissed, the Allahabad High Court, in First Appeal No. 253 of 2025, directed that the interim order restraining recovery would continue to operate. The Petitioner’s challenge to this order before the Supreme Court was dismissed.

Findings and Order

After examining the record, the NCLT noted:

● The existence of closely connected family-controlled entities and multiple parallel proceedings.

● The subsisting interim injunction of the Allahabad High Court, which expressly restrained the recovery of the alleged amount.

● The dismissal of the Petitioner’s Special Leave Petition by the Supreme Court, thereby leaving the High Court’s interim protection intact.

In light of these developments, the Tribunal held that it could not proceed with adjudication or grant repayment directions under Section 45QA while a superior court’s injunction remained operative.

The NCLT disposed of CP No. 190/ALD/2020, granting liberty to the Petitioner to revive the proceedings depending on the final outcome of the appeal pending before the Allahabad High Court. The Tribunal clarified that it was not expressing any opinion on the merits of the rival claims at this stage.