Only NCLT Has Jurisdiction Over Premature Loan Recovery Issues Under RBI Act: Allahabad High Court

The Allahabad High Court held that disputes relating to premature repayment of loans fall exclusively within the jurisdiction of the NCLT under Section 45QA of the RBI Act, read with Section 430 of the Companies Act, 2013.

The case arose from a dispute between two NBFCs, where a civil suit was filed to restrain the recovery of a loan before its tenure ended.

The Court upheld rejection of the plaint, observing that civil courts lack jurisdiction in matters assigned to the NCLT.

It also noted that such suits cannot be used to pre-empt statutory proceedings before competent forums.

[Shivam Traders & Hire Purchase Pvt. Ltd. v. Madhusudan Vehicles Pvt. Ltd.]