IBC Section 180: Civil court not to have jurisdiction

Section 180 of Insolvency and Bankruptcy Code, 2016: Civil court not to have jurisdiction

Official Bare Act Text

Override / Mandate Mens Rea (Intent) Actus Reus (Conduct) Punishment Limitation Monetary

(1) No civil court or authority shall have jurisdiction to entertain any suit or proceedings in respect of any matter on which the Debt Recovery Tribunal or the Debt Recovery Appellate Tribunal has jurisdiction under this Code.

(2) No injunction shall be granted by any court, tribunal or authority in respect of any action taken, or to be taken, in pursuance of any power conferred on the Debt Recovery Tribunal or the Debt Recovery Appellate Tribunal by or under this Code.

Legal Commentary & Landmark Judgments: Section 180

Section 180 bars the jurisdiction of Civil Courts in respect of any matter in which the Adjudicating Authority (DRT/NCLT) is empowered by the Code to pass orders.

Express Statutory Ouster: No civil court or other authority has jurisdiction to entertain any suit or proceeding in respect of any matter which the DRT/NCLT is empowered to determine under Part III.
Bar on Injunctions: No injunction can be granted by any civil court or authority in respect of any action taken or to be taken in pursuance of any order passed by the Adjudicating Authority.
Universal In-Rem Preclusion: Ensures that parallel civil, mortgage, or summary suits cannot be used to circumvent the unified insolvency and bankruptcy process.

Key Landmark Precedents:

Gujarat Urja Vikas Nigam Ltd. v. Amit Gupta (2021) 7 SCC 209: The Supreme Court held that the express bar on civil court jurisdiction under the Code ensures that all disputes arising out of insolvency are consolidated before the specialized Adjudicating Authority.
Innoventive Industries Ltd. v. ICICI Bank (2018) 1 SCC 407: Affirmed that the non-obstante provisions and jurisdiction bar under the Code override general civil court jurisdictions.

Courtroom Practice & Strategic Litigation Guidance:

If a debtor or creditor attempts to obtain a status quo or injunction order from a civil court during individual bankruptcy, counsel for the trustee must immediately file an Order VII Rule 11 application relying on Section 180 for immediate plaint rejection.