Power Of Attorney Can Be Executed By Officers Nominated By Designation, Not Necessarily By Name: NCLAT New Delhi

Background of the Case

The appeal was filed against the decision of the adjudicating authority, by which it had dismissed the appellant's application seeking amendment of Form-1. The adjudicating authority dismissed the application on the basis of maintainability without considering its merit. It reasoned that the application for amendment was filed by the officer who was not appointed by a validly executed power of attorney. The adjudicating authority observed that the General Manager and Deputy General Manager were nominated, but they were not specifically named, and the nomination should have been by their names.

Contention of the Appellant

The appellant relied on the Hon'ble Supreme Court's ruling in the case of United Bank of India v. Naresh Kumar and Others (1996) 6 SCC 660 and submitted that if the line of reasoning of the Adjudicating Authority is followed, then all the activities of the bank would come to a standstill. It submitted that the nomination by designation is valid enough, as there is certainty as to the officer who will have the authority to execute the POA.

The respondent contended that the Board Resolution authorized the Chairman and the Managing Director of the bank, or in his absence the Executive Director, to nominate. However, in the proceedings dated 24.11.2024, the authority to issue POA was delegated to the General Manager (HRM) and the Deputy General Manager (HRM).

Observations of the NCLAT

The bench observed that the careful reading of the Board Resolution gives that the authority granted to the Chairman and the Executive Director was to nominate the officer who would be competent to issue a power of attorney. And, pursuant to that authority, the General Manager and the Deputy were appointed as the officials to issue the power of attorney.

The tribunal discussed that the power of attorney is a document appointing an agent, and it is significant to consider that the person executing it should have the valid authority to execute it, and any authority can be appointed for this purpose. The law puts no restrictions on any authority to execute a power of attorney by reason of the office he or she holds.

With this, the tribunal observed that the power of attorney was validly executed in the case. It set aside the order of the adjudicating authority and directed it to hear and dispose of the matter on merit.

Case Name: Indian Bank v. M/s. Aman Hospitality Private Limited

Case No.: Company Appeal (AT) (Ins) No. 569 of 2025

For Appellant: Mr. Gautam Awasthi, Mr. Ayush Choudhary, Mr. Devanshu Yadav, Advocates

For Respondent: Mr. U.K. Chaudhary, Sr. Advocate with Mr. V. Anush Raajan, Mr. Mansumyer, Mr. Pradyumn Yadav, Advocates

Bench: Justice N. Seshasayee (Member – Judicial) and Arun Baroka (Member – Technical)

Judgment Date: 07.08.2025