Gloster Limited v. Gloster Cables Limited: NCLT residuary jurisdiction is nexus-bound

The facts in brief

Fort Gloster Industries Limited (FGIL) was a Kolkata-based manufacturer of cables and electrical equipment. It owned a registered trademark "Gloster" (Registration No. 690772, Class 9). In due course FGIL was admitted into the Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code 2016. The CIRP proceeded, a resolution plan was put to vote, the Committee of Creditors approved it, and the National Company Law Tribunal sanctioned the plan under section 31 IBC. Gloster Limited emerged as the Successful Resolution Applicant.

The complication was external. Gloster Cables Limited (GCL) — an entity unrelated to FGIL but trading under the "Gloster" mark in the cables segment — claimed that the "Gloster" trademark belonged to it rather than to FGIL. The competing claim pre-dated the CIRP. It was, in trademark terms, an old dispute about priority of use, ownership and the legitimacy of FGIL's registration. The resolution plan that the Committee of Creditors had approved acknowledged the existence of this dispute and expressly recorded that the SRA was acquiring such rights as FGIL possessed in the mark, including any defects of title.

After the plan was approved, Gloster Cables Limited filed an application before the NCLT seeking a declaration that the trademark vested in it and not in FGIL. The NCLT, invoking its residuary jurisdiction under section 60(5)(c) IBC, declared that the trademark vested in the Successful Resolution Applicant. The NCLAT affirmed. Both Gloster Limited (seeking to consolidate the SRA's title) and Gloster Cables Limited (challenging the very jurisdictional foundation of the NCLT's declaration) appealed to the Supreme Court.

On 22 January 2026, a two-judge bench of Justices J.B. Pardiwala and K.V. Viswanathan held that the NCLT had no jurisdiction to enter the trademark-title dispute, set aside the NCLAT's affirmation, and remitted the trademark-title dispute to the competent civil court.

The statutory architecture

Section 60(5) IBC vests the NCLT with three categories of jurisdiction beyond its primary admission and approval functions. Clause (a) covers applications or proceedings by or against the corporate debtor. Clause (b) covers claims made by or against the corporate debtor including claims by or against any of its subsidiaries. Clause (c) — the residuary clause at the centre of Gloster — covers "any question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code."

The interpretive question is what "in relation to" carries. A maximalist reading would treat every dispute touching any asset of the corporate debtor — including disputed-title questions over IP, immovable property, contract rights — as falling within clause (c). A minimalist reading would confine clause (c) to questions whose adjudication is necessary for the CIRP or liquidation itself to proceed: priorities between creditors, treatment of avoidance applications, supervision of the resolution professional.

Embassy Property Developments v. State of Karnataka (2020) 13 SCC 308 had begun the work of mapping clause (c)'s outer limits. Embassy held that the NCLT could not adjudicate questions falling within the exclusive jurisdiction of public law authorities — there, the renewal of a mining lease which lay within the constitutional jurisdiction of the Karnataka High Court. Gloster extends the same disciplinary logic to disputed civil-title questions in intellectual property.

What the Court held

The trademark dispute was not "in relation to" the insolvency

The Bench's reasoning began at the facts. The "Gloster" trademark dispute between FGIL and GCL pre-dated the CIRP by many years. The dispute did not arise from the insolvency. The CIRP did not give rise to it. The resolution plan did not generate it. The plan instead acknowledged the dispute and recorded that the SRA was acquiring whatever rights FGIL had, defects and all. In that posture the disputed-title question was a pre-existing civil controversy that the CIRP simply could not absorb.

The Court treated this as a fact-bounded application of Embassy's structural principle rather than as a categorical pronouncement on disputed-IP-in-CIRP. The fact-bounding matters: there may yet be disputed-IP disputes that genuinely arise out of a CIRP — for example, where the resolution plan itself purports to assign IP that the corporate debtor did not own — and Gloster does not foreclose NCLT jurisdiction in such configurations. What Gloster forecloses is the deployment of section 60(5)(c) to retroactively perfect a disputed title that the plan itself flagged as contested.

The plan cannot be modified by NCLT adjudication

The second strand of reasoning is structural and addresses what a resolution plan, once approved, means. The approved plan recorded that the SRA was taking such rights as FGIL possessed. A subsequent NCLT declaration that the trademark vested in the SRA — full title, free of any rival claim — would constitute a modification of the plan. The IBC architecture does not permit unilateral post-approval modification: the plan, once approved under section 31, binds the corporate debtor, creditors, employees, members and government authorities; its terms cannot be expanded by NCLT order.

This strand has significance beyond the IP context. It is a general statement that the NCLT's continuing supervisory jurisdiction over plan implementation cannot be used to give the SRA more than the plan itself recorded. SRAs who take a discounted plan because of disputed-asset risk cannot subsequently seek NCLT orders that erase the discount.

Remittal to civil court — uninfluenced by NCLT observations

The Bench's operative direction remitted the disputed-title question to the competent civil court under the Trade Marks Act 1999 and the Commercial Courts Act 2015. The civil court was directed to adjudicate the dispute uninfluenced by any observations the NCLT or NCLAT had made — a careful instruction that prevents the insolvency-proceedings record from prejudicing the substantive IP adjudication.

The doctrinal architecture

Gloster sits in dialogue with three earlier lines.

The first is the Embassy Property line on NCLT jurisdictional limits. Embassy (2020) had declined NCLT jurisdiction over the renewal of a mining lease; Tata Consultancy Services v. Vishal Ghisulal Jain (2022) had refined the line in the context of contract terminations during CIRP. Gloster extends the line into disputed-IP territory and crystallises the nexus-bound reading of section 60(5)(c).

The second is the Ghanashyam Mishra line on approved-plan finality. Ghanashyam Mishra and Sons v. Edelweiss Asset Reconstruction Company (2021) 9 SCC 657 had held that an approved plan binds all stakeholders and that pre-CIRP claims not part of the plan stand extinguished. Gloster clarifies the converse: claims that were flagged in the plan are not extinguished, and the plan-flagging operates as a self-imposed limit on the NCLT's adjudicatory reach.

The third is the Trade Marks Act 1999 jurisdictional allocation. Sections 27 and 28 of the Trade Marks Act 1999 vest the determination of trademark ownership in the civil court. Section 134 specifies the forum (the district court above the rank of district judge, with commercial-court jurisdiction in the relevant cities). Gloster reaffirms that this jurisdictional allocation cannot be displaced by the IBC's residuary clause.

What the judgment did not decide

The Bench's discipline is fact-bounded. The judgment does not foreclose every disputed-IP application before the NCLT. Where the disputed-IP claim is genuinely insolvency-generated — for example, an avoidance application against an IP transfer effected in the look-back period under section 43 IBC — the NCLT will retain jurisdiction. The judgment also does not address the converse situation where a resolution plan does not flag a rival claim and the SRA subsequently discovers one: that scenario will need its own jurisprudence.

The judgment also leaves untouched the broader question of whether the IBC's residuary clause should be statutorily amended to clarify its scope. The Insolvency Law Committee has, in earlier reports, recommended clarificatory amendments to several IBC provisions; whether section 60(5)(c) will attract a similar reference is a policy question that Gloster sharpens but does not resolve.

After the judgment

The judgment will reshape IP-and-insolvency strategy across India. Successful Resolution Applicants in CIRPs involving valuable IP assets will need to commission independent IP-title due diligence before bidding. Resolution plans will need to be drafted with explicit recognition of rival-claim risk and explicit reservation that disputed-title questions remain for civil-court adjudication. Committees of Creditors will need to factor the IP-title risk into their valuation, since the SRA can no longer assume that NCLT will resolve title disputes downstream.

NCLT and NCLAT will need to police the boundaries of section 60(5)(c) more conservatively — declining to entertain disputed-title applications and remitting parties to civil court. Expect a wave of plan-drafting changes: explicit IP-carve-out language, escrow arrangements for disputed-title royalties, and conditional pricing structures that adjust the SRA's exposure based on the outcome of parallel civil-court adjudication. Commercial courts at the city civil court level will see increased pendency of trademark, copyright and design disputes referred from the NCLT under the Gloster discipline.

The judgment also strengthens the position of legitimate IP-rivals who had been concerned that the IBC was being used as a shortcut to perfect disputed title. Watch for follow-on judgments testing the nexus-bound reading of section 60(5)(c) in other property-title contexts — disputed-land claims, contract disputes with third parties, and software-licence disputes — where NCLT had been pressed to enter substantive adjudication.

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Sources

1. Verdictum case page: https://www.verdictum.in/court-updates/supreme-court/gloster-limited-v-gloster-cables-limited-2026-insc-81-title-trademark-ibc-1605293
2. LiveLaw judgment page: https://www.livelaw.in/amp/supreme-court/s-605c-ibc-nclt-cannot-decide-trademark-ownership-dispute-which-isnt-related-to-insolvency-proceedings-supreme-court-520149
3. LawGico law update — bench reasoning summary: https://lawgico.in/law-updates/nclt-cannot-decide-disputed-trademark-title-under-section-605-ibc-when-plan-recognizes-rival-claims-supreme-court-restores-nclat-view/
4. SCC OnLine Times blog — section 60(5)(c) doctrinal note: https://www.scconline.com/blog/post/2026/01/27/sc-ibc-section-605c-nclt-residuary-jurisdiction-trademark/
5. BarandBench coverage — operative directions and remittal to civil court: https://www.barandbench.com/news/litigation/supreme-court-gloster-trademark-nclt-jurisdiction-ibc