NCLT can't rule on trademark, beyond ken of approved plan: SC

The Supreme Court has held that the National Company Law Tribunal cannot under Section 60(5)(c) of the Insolvency and Bankruptcy Code declare title to the trademark in favor of the successful resolution applicant.

A bench of Justices J B Pardiwala and K V Vishwanathan said under Section 60 of the IBC, the interpretation of the phrase “arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code” will have to be contextualized with the facts arising in a given CIRP.

The examination in each case will depend on the facts as they present themselves in a given CIRP, the court emphasized.

The bench stressed, any grant of further rights over and above what is recognized in the plan would amount to modification or alteration of the approved plan.

The court here was dealing with two appeals arising from the judgment of the National Company Law Appellate Tribunal, Principal Bench, New Delhi of January 25, 2024. One civil appeal was filed by Gloster Limited – the successful resolution applicant, while another one by Gloster Cables Limited (GCL), challenging the findings in the impugned judgment insofar as it held that the adjudicating authority had the jurisdiction to declare on the aspect of title to the trademark “Gloster”.

In the matter, the NCLT, Kolkata held the trademark “Gloster” was the asset of the corporate debtor Fort Gloster Industries Limited (FGIL). On an appeal filed by GCL, the NCLAT, after ruling on the jurisdiction of the NCLT/adjudicating authority to go into title, ultimately held in favour of GCL.

The SRA was aggrieved by the negation of the findings recorded by the NCLT to the effect that the trademark was the property of the corporate debtor. The GCL was aggrieved by the pronouncement on the issue of jurisdiction.

The bench examined the question whether the adjudicating authority could have, on the facts of the present case, in the process of adjudicating the application of GCL, recorded a finding that the trademark “Gloster” was an asset of the corporate debtor (FGIL) and consequently of the SRA.

After going through the facts of the matter, the bench said, "We find that the adjudicating authority could not have, while approving the plan in the present form, (on which the Committee of Creditors had voted) gone ahead and granted a declaration in favour of the appellant about its entitlement to the Trademark “Gloster”.''

Referring to Gujarat Urja Vikas Nigam Ltd. v. Amit Gupta and others (2021), the bench pointed out, previously, this court has emphatically held that the adjudicating authority cannot exercise its jurisdiction over matters dehors the insolvency proceedings since such matters fall outside the realm of IBC.

In SREI Multiple Asset Investment Trust Vision India Fund v. Deccan Chronicle Marketeers and others (2023), the bench noted, the adjudicating authority contrary to what the plan had provided for to the SRA therein, granted the SRA the exclusive right to use the Trademarks “Deccan Chronicle” and “Andhra Bhoomi” and also made a declaration that Trademarks belonged to corporate debtor.

This court found that the adjudicating authority while ordering an application apart from upholding the exclusive right to use the Trademarks made a further declaration that the Trademarks belongs to the Corporate Debtor which was a modification/alteration in the approved resolution plan and was just impermissible, the bench pointed out.

The bench thus said, ''We have no doubt in our mind that in exercise of power under Section 60(5)(c) of IBC and while adjudicating the application of GCL on the facts of the present case, the adjudicating authority could not have declared title in the trademark “Gloster” in favour of the appellant SRA. The issue of the title of the Trademark was not “in relation to the insolvency proceedings”, on the facts of the present case.''

The court held the ultimate order of the NCLT recognizing the title in the trademark “Gloster” with the SRA does not reconcile with the resolution plan as approved by the COC and later by the adjudicating authority.

"In a case like the present where the SRA has perceived clouds hovering over its title, it is for the SRA to resort to remedies and protect its rights. On the facts of the present case, while adjudicating an application under Section 60(5) of GCL, NCLT could not have passed the direction it ultimately passed,'' the bench said.

The court did not approve of the finding of the NCLT that while adjudicating the application of GCL and in the process of approving the plan, they could have resorted to an enquiry under Sections 43 and 45 of the IBC. The findings of the NCLT are perverse and in gross violation of the principles of natural justice and beyond the scope of the enquiry, it held.

Setting aside the finding of the adjudicating authority, the bench clarified its these observations would not come in the way of any other court or authority deciding the issue of title to the trademark “Gloster”.

The court also declared that the NCLAT's observations cannot be sustained since that was also a matter over which the fora below could not have enquired into in the facts and circumstances.

Case Title: Gloster Limited Vs Gloster Cables Limited & Ors decided by a bench of A bench of Justices J B Pardiwala and K V Vishwanathan on January 22, 2026.