NCLT holds former Euro Ceramics liquidator guilty of contempt over excess fees
The NCLT Mumbai held a former liquidator of Euro Ceramics guilty of contempt for not refunding Rs 72,51,530 that the tribunal found he withdrew as excess fees, and fined him Rs 2,000.
Key points
- The NCLT Mumbai held a former liquidator of Euro Ceramics Limited guilty of contempt for not obeying its refund order, in an order delivered on 29 October 2026.
- The tribunal had earlier found he withdrew excess fees and ordered him to refund Rs 72,51,530 with GST and interest; the NCLAT upheld that order.
- He must refund the money within 30 days or serve one week of simple imprisonment, the NCLT ordered; the matter is listed on 30 November 2026.
The National Company Law Tribunal (NCLT), Mumbai Bench-I, has held a former liquidator of Euro Ceramics Limited guilty of contempt for failing to obey its order to refund Rs 72,51,530 (about Rs 72.52 lakh) that the tribunal found he had withdrawn from the company's liquidation account as excess fees. In its order delivered on 29 October 2026, the tribunal fined him Rs 2,000 and gave him 30 days to refund the money, failing which he must serve one week of simple imprisonment.
What Happened
Euro Ceramics Limited is in liquidation, the winding-up stage of insolvency, in a case started by Anchor Leasing Private Limited. On 31 October 2025, the NCLT found that the former liquidator had withdrawn excess fees from the company's account and ordered him to refund Rs 72,51,530 with GST and applicable interest. According to the order, the NCLAT upheld this on 24 February 2026 and the Supreme Court dismissed his appeal. A review application he filed on 2 September 2026 is pending.
The present liquidator then sought contempt proceedings because the money had not been repaid. The former liquidator argued that it was at most a matter for execution proceedings and that Rs 23,51,710 of the amount was GST he had already paid. The tribunal held that once the appeals were dismissed, the amount was payable, and that at most only the GST on the excess fees could be deducted. It said a liquidator is entrusted with the company's assets and should have refunded the money as soon as the withdrawal was pointed out.
The tribunal said one week's simple imprisonment would meet the ends of justice, but in view of his age and health it imposed the Rs 2,000 fine with a chance to purge the contempt by refunding the money. It allowed the present liquidator to start execution proceedings to recover the amount and listed the matter on 30 November 2026.
What It Means
Money in a liquidation account belongs to the company being wound up and is used to pay its creditors and workers. The order shows the tribunal will use its contempt powers against an insolvency professional who keeps such money after being ordered to return it. The order may be appealed to the NCLAT.
Source: NCLT order
Sources & Citations
- NCLT order — National Company Law Tribunal