The Supreme Court has ordered an inquiry into startling claims by a judicial member of the National Company Law Appellate Tribunal (NCLAT) that he was “approached by one of the most revered members of the higher judiciary” seeking a favourable order in a pending case.
According to sources, the inquiry will be conducted by the Secretary General of the apex court, and the future course of action will depend on its outcome.
Justice Sharad Kumar Sharma, who currently serves as a judicial member of the Chennai bench of the NCLAT, made the disclosure in open court while recusing himself from a case on August 13.
In a two-paragraph order, he observed:
“We are anguished to observe, that one of us, Member (Judicial), has been approached by one of the most revered members of the higher judiciary of this country for seeking an order in favour of a particular party. Hence, I recuse to hear the matter.”
Following his recusal, the tribunal requested its chairperson to reassign the case to an appropriate bench.
The matter concerned an appeal filed by A.S. Reddy, suspended director of Hyderabad-based KLSR Infratech, which is undergoing a Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code. The CIRP had been initiated by the Hyderabad bench of the National Company Law Tribunal (NCLT) on July 14, 2023, on a plea by creditor AS Met Corp Pvt Ltd.
The insolvency appellate tribunal had reserved judgment on June 18 after hearing arguments from both sides, and granted them seven days to file written submissions. The case was listed for pronouncement on August 13 before the two-member Chennai bench comprising Justice Sharma and Technical Member Jatindranath Swain, when the unexpected recusal order was passed.
Justice Sharad Kumar Sharma retired as a judge of the Uttarakhand High Court on December 31, 2023, and joined NCLAT as a judicial member on February 19, 2024. He has previously recused from several significant matters, including those relating to ed-tech company Byju’s, Jeppiaar Cements, and Ramalinga Mills, citing past professional associations.
