{"id":51594,"date":"2023-01-05T12:58:53","date_gmt":"2023-01-05T07:28:53","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=51594"},"modified":"2023-01-05T12:58:54","modified_gmt":"2023-01-05T07:28:54","slug":"national-company-law-tribunal-nclt","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/","title":{"rendered":"National Company Law Tribunal (NCLT) &#8211; All You Need to Know"},"content":{"rendered":"\n<p>One of the primary reasons behind\nIndia\u2019s emergence as a global economic giant is company and corporate\ninsolvency laws, and how they have facilitated business and investment growth\nis commendable. With the increase of trade and industry, the fairs related to\ncompany matters were also rapidly increasing, resulting in burdens on the High\nCourts. As a result, the justice delivery was getting slow. This forced many\nnational and international companies to move to more amicable locations like\nSingapore to establish their headquarters.&nbsp;In this article, we will talk\nabout <strong>National\nCompany Law Tribunal (NCLT).<\/strong><\/p>\n\n\n\n<p>Till 2016, the Company Law Board also called as CLB (it was set up in 1956 under the Companies Act of 1956), Board for Industrial and Financial Reconstruction also known as BIFR<strong> <\/strong>(it was created under the Sick Industrial Companies Act of 1985), Appellate Authority for Industrial and Financial Reconstruction and the High Court used to adjudicate matters related to company affairs, this multiplicity of authorities resulted in justice delivery process. The establishment of the National Company Law Tribunal and the National Company Law Appellate Tribunal eradicated all these problems by simplifying the process of the delivery justice system. <\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/#What_is_NCLT\" >What is NCLT?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/#Jurisdiction_of_NCLT\" >Jurisdiction of NCLT<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/#Functions_of_National_Company_Law_Tribunal\" >Functions of National Company Law Tribunal<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/#Advantages_of_the_National_Company_Law_Tribunal\" >Advantages of the National Company Law Tribunal<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/#What_Are_The_Power_Vested_In_The_Tribunal\" >What Are The Power Vested In The Tribunal?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/#Procedure_to_File_a_Case_before_National_Company_Law_Tribunal\" >Procedure to File a Case before\nNational Company Law Tribunal<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/corpbiz.io\/learning\/national-company-law-tribunal-nclt\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_NCLT\"><\/span>What is NCLT? <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li><strong>Meaning\n<\/strong><\/li><\/ul>\n\n\n\n<p>In 2002, the Companies\nAct of 1956 was amended, following which the Eradi Committee proposed\nintroducing provisions related to National Company Law Tribunal and the\nNational Company Law Appellate Tribunal (NCLAT). However, no step was taken\nuntil June 6, 2016, when the Ministry of Corporate Affairs issued a notice\nregarding the powers of NCLT AND NCLAT. The way for NCLT AND NCLAT was carved\nunder the ambit of&nbsp;<em>Section 408<\/em>&nbsp;and&nbsp;<em>Section 410<\/em>&nbsp;of the Companies Act 2013.\nNCLT or also called the National Company Law Tribunal is a quasi-judicial\nauthority incorporated under the preview of&nbsp;<em>the\nCompanies Act of 2013<\/em>&nbsp;to solely deal with matters related to\ncorporate disputes of civil nature arising under the Act.&nbsp;<\/p>\n\n\n\n<p><strong>NCLT<\/strong><sup><a class=\"text-primary\" href=\"https:\/\/nclt.gov.in\/\"><strong>[1]<\/strong><\/a><\/sup> has given the same powers and\nprocedures as a court of law. Just like an ordinary court in India, the\ntribunal also works on the same line. It also has to be impartial while\ndetermining the facts of the case and deciding the case by using the principle\nof natural justice. All the orders and decisions pronounced by NCLT are to be\nreviewed by NCLAT. NLACT has the authority to uphold the decisions of NCLT. <\/p>\n\n\n\n<ul><li><strong>Historical Perspective<\/strong><\/li><\/ul>\n\n\n\n<p>In 1988 the\nLaw Commission of India presented its 124th Law Report, which pointed out the\nproblem of backlogging cases. It stated that with the progression in different\nfields of law, different kinds of disputes are arising, resulting in the delay\nof justice. Therefore there is an urgent need to establish an independent\ntribunal.<\/p>\n\n\n\n<p>But finally, the concept of NCLT for dealing with all the matters related\nto company law came after the Companies (II Amendment) Act of 2002. This was\nrecommended by a committee headed by Justice V. Balakrishna Eradi. <\/p>\n\n\n\n<ul><li><strong>Difference <\/strong><strong>Between\n<\/strong><strong>NCLT <\/strong><strong>And\n<\/strong><strong>NCLAT<\/strong><\/li><\/ul>\n\n\n\n<p>The NCLT is the ground level\njurisdiction and NCLAT is the appellate jurisdiction like that of a High Court\nin India. When a case is presented before NCLT, it has the duty to take in\naccount all the evidences and witnesses so that the tribunal can reach upto a\nconclusion and makes the decision. The NCLAT usually just review orders and decisions\nof NCLT and only consider points related to law or fact. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Jurisdiction_of_NCLT\"><\/span>Jurisdiction of NCLT<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Mentioned\nbelow are the branches and respective jurisdictions of the National Company Law\nTribunal:<\/p>\n\n\n\n<ul><li>NCLT,\nPrincipal Bench and NCLT, New Delhi Bench<\/li><li>NCLT,\nAhmedabad Bench<\/li><li>NCLT,\nAllahabad Bench<\/li><li>NCLT, Bengaluru\nBench<\/li><li>NCLT,&nbsp;Chandigarh\nBench<\/li><li>NCLT,\nChennai Bench<\/li><li>NCLT\nGuahati Bench<\/li><li>NCLT\nHyderabad Bench<\/li><li>NCLT\nKolkata Bench<\/li><li>NCLT Mumbai\nBench<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Functions_of_National_Company_Law_Tribunal\"><\/span>Functions of <strong>National Company Law Tribunal<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Following is the list of\nfunctions performed by the National Company Law Tribunal:<\/p>\n\n\n\n<ul><li>All the\nproceeding of a company related to arbitration, arrangements, compromise,\nreconstruction, and winding up will be only be disposed of by the&nbsp;Tribunal.\n<\/li><li>The\ntribunal is also vested with power to dispose of case related to insolvency\nunder the&nbsp;Insolvency and Bankruptcy Code of 2016. <\/li><\/ul>\n\n\n\n<p>(<strong>Note:<\/strong> For the above matters civil\ncourts will have no jurisdiction.)<\/p>\n\n\n\n<ul><li>All the\ncases that were pending before the Board for Industrial and Financial\nReconstruction (BIFR) and Sick Industrial Companies (Special Provisions) Act of\n1985, will only be disposed of by the tribunal. <\/li><li>The\ntribunal will also take up cases related to the oppression and mismanagement of\nthe company.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Advantages_of_the_National_Company_Law_Tribunal\"><\/span>Advantages of the <strong>National Company Law Tribunal<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The National Company Law Tribunal has helped to fasten the justice\ndelivery system in India. Following are some of the key advantages of the\ntribunal:<\/p>\n\n\n\n<ul><li>It provides a speedy trial. As NCLT\nis a specialized court only for companies are registered in India.<\/li><li>It\nhas helped to reduce the burden of all the high courts.<\/li><li>It\nhas helped to reduce the time taken to wind up a company <\/li><li>As\nthe tribunal is a quasi-judicial body, it is consist of both judicial and technical\nmembers while deciding a matter. <\/li><li>Tribunal has the authority to appoint Amicus Curiae for\nopinion&nbsp;on various specialized legal issues. <\/li><li>NCLT and NCLAT&nbsp;have exclusive jurisdictions. <\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_Are_The_Power_Vested_In_The_Tribunal\"><\/span>What Are The Power Vested In The Tribunal?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The National Company Law Tribunal exercises the wide range of powers, which\nare as following: <\/p>\n\n\n\n<ul><li>It\nhas the power to seek&nbsp;assistance from Chief Metropolitan Magistrate.<\/li><li>De-<strong><a class=\"text-primary\" href=\"https:\/\/corpbiz.io\/company-registration\">registration of Companies<\/a><\/strong>.<\/li><li>It provides the remedy for oppression and mismanagement.\n<\/li><li>It has the power to hear cases related to grievance of\nrefusal of transfer securities and rectification of register of members. <\/li><li>The tribunal has the power to provide relief to the\naggrieved investors against a large set of wrongful actions committed by the\nmanagement of the company. <\/li><li>The tribunal has all the authority to freeze the\naccounts of the company. It can also put restrictions on any of the security of\nthe company. <\/li><li>It has the power to convert a Public Limited Company\ninto a Private Limited Company. <\/li><li>If the company fails to call an AGM (Annual General\nMeeting) as required by the Companies Act of 2013, then the tribunal has all\nthe power to call such meeting. <\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Procedure_to_File_a_Case_before_National_Company_Law_Tribunal\"><\/span>Procedure to File a Case before\nNational Company Law Tribunal<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The following points are\nrequired to be kept in mind before filling a petition or an application, or an\nappeal before NCLT: <\/p>\n\n\n\n<ul><li>All the documents filled\nin before the tribunal needs to be in English.&nbsp;<\/li><li>All petitions,\napplications or appeals need to be filled in Form NCLT 1. This needs to be\nfilled along with the attachment of notice of admission in Form NCLT-2.<\/li><li>The title heading for\nproceeding shall be in Form NCLT.4<\/li><li>An Affidavit shall verify\nevery petition or application in Form NCLT 6.<\/li><li>Notice of motion needs to\nbe filed in Form NCLT.3.<\/li><li>Where\nany petition or application is required to be advertised, it shall be announced\nby filling Form NCLT-3A.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The move of central government towards the constitution of National Company Law Tribunal (NCLT) as a single forum to adjudicate the cases of company law was welcomed by the shareholders in India. As it speed up the process of decision making also cut down all the unnecessary fragmentation and repetition. It also reduces the burden of the High Courts in India by forming NCLAT (National Company Law Appellate Tribunal. The establishment of the National Company Law Tribunal and the National Company Law Appellate Tribunal eradicated all these problems by simplifying the process of the delivery justice system.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read Our Article<\/b>: <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/winding-up-of-a-company-by-tribunal\/\">Commencement Of Winding Up Of A Company By Tribunal Under Companies Act 2013<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>One of the primary reasons behind India\u2019s emergence as a global economic giant is company and corporate insolvency laws, and how they have facilitated business and investment growth is commendable. With the increase of trade and industry, the fairs related to company matters were also rapidly increasing, resulting in burdens on the High Courts. As [&hellip;]<\/p>\n","protected":false},"author":48,"featured_media":51595,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[120],"tags":[3001],"acf":{"service_id":"408"},"authorName":"Astitva Kumar","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/12\/MicrosoftTeams-image-27.jpg","authorDescription":"Astitva Kumar is an advocate by profession and has completed her BBA. LLB from IP University. She is an avid reader, researcher, and legal writer. Her areas of interest include mediation, conflict resolution, finance, cyber laws, and taxation.","postViews":5371,"readingTime":5,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/51594"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/48"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=51594"}],"version-history":[{"count":2,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/51594\/revisions"}],"predecessor-version":[{"id":51597,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/51594\/revisions\/51597"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/51595"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=51594"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=51594"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=51594"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}