{"id":6613,"date":"2020-12-13T11:33:23","date_gmt":"2020-12-13T11:33:23","guid":{"rendered":"https:\/\/lexforti.com\/legal-news\/?p=6613"},"modified":"2021-01-17T04:59:21","modified_gmt":"2021-01-17T04:59:21","slug":"national-company-law-tribunal-nclt","status":"publish","type":"post","link":"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/","title":{"rendered":"Everything you should know about National Company Law Tribunal (NCLT)"},"content":{"rendered":"\n<p class=\"has-text-align-justify\">This article describes the concept of National Company Law Tribunal (NCLT); written by Naina solanki student of Prestige institute of management and research.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_47_1 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\">Table of 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=\"ez-toc-toggle-icon-1\"><label for=\"item-6a3b97b5b9583\" aria-label=\"Table of Content\"><span style=\"display: flex;align-items: center;width: 35px;height: 30px;justify-content: center;direction:ltr;\"><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><\/label><input  type=\"checkbox\" id=\"item-6a3b97b5b9583\"><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#Introduction\" title=\"Introduction\">Introduction<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#Historical_Background\" title=\"Historical Background\">Historical Background<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#Jurisdiction\" title=\"Jurisdiction\">Jurisdiction<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#Benches\" title=\"Benches\">Benches<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#National_Company_Law_Tribunal_Benches\" title=\"National Company Law Tribunal Benches\">National Company Law Tribunal Benches<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#Structure_of_benches\" title=\"Structure of benches\">Structure of benches<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#NCLAT\" title=\"NCLAT\">NCLAT<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#NCLT_Functions\" title=\"NCLT Functions\">NCLT Functions<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Introduction\"><\/span>Introduction<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"has-text-align-justify\">The National Company Law Tribunal or NCLT is a quasi-judicial body that adjudicates matters and issues related to Indian companies which have been established under the Companies Act, 2013. Constituted on 1 June 2016 by the government of India by virtue of Section 408 of the Companies Act, 2013, based on the recommendation of the V Balakrishna Eradi committee on the law relating to the insolvency and the winding up of companies.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Historical_Background\"><\/span>Historical Background<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"has-text-align-justify\">Before the establishment of National law tribunal, company-related issues were resolved by the Company Law Board. In 2002, in companies act, 1956 amendments were made for the formation of National company law tribunal instead of Company law board. There were 4 benches of the board Delhi, Kolkata, Mumbai and Chennai.<\/p>\n\n\n\n<p class=\"has-text-align-justify\">But this 2002 amendment was challenged by Madras lawyer. The Constitutionality of this was questioned and thereby the formation of NCLT was delayed.<\/p>\n\n\n\n<p class=\"has-text-align-justify\">Company issues related to industries and finance were dealt with by BIFR board (Board for Industrial and Financial Corporation) and Appellant of same. Also, different merger and amalgamation decision was decided by the High court.<\/p>\n\n\n\n<p class=\"has-text-align-justify\">This means that there was no one jurisdiction for company issues and these different boards and courts complicated the process. There was a need for one body to deal with all the company related issues.<\/p>\n\n\n\n<p class=\"has-text-align-justify\">By the provisions of companies act, 2013 National Company law Tribunal was formed on 1 June 2016. This changed all the proceedings. In 2016, the Supreme Court upheld high court judgement and Company law board was abolished and its pending work was transferred to NCLT.<\/p>\n\n\n\n<p class=\"has-text-align-justify\">&nbsp;Previously, in company law board CA and CS were able to file a petition but if the matter leads to the High court lawyer used to represent the company. After the formation of NCLT, CA and CS are treated at par with lawyers. High court jurisdiction shifted to NCLT.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Jurisdiction\"><\/span>Jurisdiction<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>After the formation of NCLT, it acquired the jurisdiction of the following-<\/p>\n\n\n\n<ol type=\"1\"><li>&nbsp;Company law board<\/li><li>&nbsp;BIFR &nbsp;(Board for Industrial and Financial Corporation)<\/li><li>&nbsp;AAIFR (<a href=\"https:\/\/lexforti.com\/legal-news\/the-court-during-judicial-review-do-not-have-the-same-power-as-that-of-an-appellate-authority\/\" target=\"_blank\" rel=\"noreferrer noopener\">Appellate Authority<\/a> for Industrial and Financial Reconstruction)<\/li><li>&nbsp;High court<\/li><\/ol>\n\n\n\n<p class=\"has-text-align-justify\">This means that the NCLT is empowered to look into the matters of these boards and corporation for resolving company issues. Also, the proceedings under the Act are to be dealt with by this <a href=\"https:\/\/lexforti.com\/legal-news\/power-to-grant-interim-relief-is-vested-with-the-arbitration-tribunal\/\" target=\"_blank\" rel=\"noreferrer noopener\">tribunal such as arbitration<\/a>, compromise, winding up etc.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Benches\"><\/span>Benches<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"National_Company_Law_Tribunal_Benches\"><\/span>National Company Law Tribunal Benches<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<figure class=\"wp-block-table\"><table><thead><tr><td><strong>S.NO.<\/strong><\/td><td><strong>Name Of Bench<\/strong><strong><\/strong><\/td><td><strong>Location<\/strong><strong><\/strong><\/td><td><strong>Territorial Jurisdiction <\/strong><strong><\/strong><\/td><\/tr><\/thead><tbody><tr><td>1<\/td><td>(a) National Company Law Tribunal, Principal Bench. (b) National Company Law Tribunal, New Delhi Bench.<\/td><td>New Delhi<\/td><td>(1) Union territory of Delhi.<\/td><\/tr><tr><td>2<\/td><td>(a) National Company Law Tribunal, Ahmedabad Bench.<\/td><td>Ahmedabad<\/td><td>(1) State of Gujarat (2) Union Territory of Dadra and Nagar Haveli (3) Union Territory of Daman and Diu<\/td><\/tr><tr><td>3<\/td><td>National Company Law Tribunal, Allahabad Bench.<\/td><td>Allahabad<\/td><td>(1) State of Uttar Pradesh. (2) State of Uttarakhand.<\/td><\/tr><tr><td>4<\/td><td>National Company Law Tribunal, Amaravati Bench.<\/td><td>Hyderabad<\/td><td>(1) State of Andhra Pradesh<\/td><\/tr><tr><td>5<\/td><td>National Company Law Tribunal, Bengaluru Bench.<\/td><td>Bengaluru<\/td><td>(1) State of Karnataka.<\/td><\/tr><tr><td>6<\/td><td>National Company Law Tribunal, Chandigarh Bench.<\/td><td>Chandigarh<\/td><td>(1) State of Himachal Pradesh. (2) State of Jammu and Kashmir. (3) State of Punjab. (4) Union territory of Chandigarh. (5) State of Haryana.<\/td><\/tr><tr><td>7<\/td><td>National Company Law Tribunal, Chennai Bench.<\/td><td>Chennai<\/td><td>(1) State of Tamil Nadu. (2) Union territory of Puducherry.<\/td><\/tr><tr><td>8<\/td><td>National Company Law Tribunal, Cuttack&nbsp;Bench.<\/td><td>Cuttack&nbsp;<\/td><td>(1) State of Chhattisgarh. (2) State of Odisha.<\/td><\/tr><tr><td>9<\/td><td>National Company Law Tribunal, Guwahati Bench.<\/td><td>Guwahati<\/td><td>(1) State of Arunachal Pradesh. (2) State of Assam. (3) State of Manipur. (4) State of Mizoram. (5) State of Meghalaya. (6) State of Nagaland. (7) State of Sikkim. (8) State of Tripura.<\/td><\/tr><tr><td>10<\/td><td>National Company Law Tribunal, Hyderabad Bench.<\/td><td>Hyderabad<\/td><td>(1) State of Telangana.<\/td><\/tr><tr><td>11<\/td><td>National Company Law Tribunal, Indore Bench.<\/td><td>Ahmedabad<\/td><td>(1) State of Madhya Pradesh<\/td><\/tr><tr><td>12<\/td><td>National Company Law Tribunal, Jaipur Bench.<\/td><td>Jaipur<\/td><td>(1) State of Rajasthan.<\/td><\/tr><tr><td>13<\/td><td>National Company Law Tribunal, Kochi Bench.<\/td><td>Kochi<\/td><td>(1) State of Kerala (2) Union Territory of Laksha<\/td><\/tr><tr><td>14<\/td><td>National Company Law Tribunal, Kolkata Bench.<\/td><td>Kolkata Bench<\/td><td>(1) State of Bihar. (2) State of Jharkhand. (3) State of West Bengal. (4) Union territory of Andaman and Nicobar Islands.<\/td><\/tr><tr><td>15<\/td><td>National Company Law Tribunal, Mumbai Bench.<\/td><td>Mumbai Bench<\/td><td>(1) State of Goa. (2) State of Maharashtra.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>Source: <a href=\"https:\/\/nclt.gov.in\/content\/national-company-law-tribunal-benches\">https:\/\/nclt.gov.in\/content\/national-company-law-tribunal-benches<\/a><\/p>\n\n\n\n<p class=\"has-text-align-justify\">At present, 16 benches are present, six at New Delhi along with Principal bench, 2 at Ahmedabad, Chennai and Kolkata, 3 at Hyderabad with one at Amaravathi, 5 at Mumbai and one each at Allahabad, Bengaluru, Chandigarh, Cuttack, Guwahati, Jaipur and Kochi.<\/p>\n\n\n\n<p>*All benches are division benches except for Amravathi.<\/p>\n\n\n\n<p>*Indore bench is not yet notified.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Structure_of_benches\"><\/span>Structure of benches<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"has-text-align-justify\">Each Bench is headed by a President, 16 judicial members, and 9 technical members. The current and the first President of the NCLT is Justice MM Kumar.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"NCLAT\"><\/span>NCLAT<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"has-text-align-justify\">It is the appellant tribunal for the cases decided by NCLT. It is formed by the government of India under Section 410 of the Act. A company can also appeal to the Supreme Court if it is not satisfied by the decision granted by NCLT or NCLAT.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"NCLT_Functions\"><\/span>NCLT Functions<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ol type=\"1\"><li>Registration\/ De-registration of Companies<\/li><li>Transfer of shares \/ Refusal of shares<\/li><li>Deposits<\/li><li>Power to Investigate<\/li><li>Freezing assets of the company<\/li><li>Converting a public limited company into private limited company (Section 459)<\/li><li>Class Action<\/li><li>Reopening of accounts<\/li><li>Winding up of the company<\/li><\/ol>\n\n\n\n<ul type=\"1\"><li><strong>Registration of Companies<\/strong><\/li><\/ul>\n\n\n\n<p class=\"has-text-align-justify\">A company can be de-registered by NCLT when under <a href=\"http:\/\/ebook.mca.gov.in\/Actpagedisplay.aspx?PAGENAME=17386\" target=\"_blank\" rel=\"noreferrer noopener\">Section 7(7) of Companies Act, 2013<\/a> of the companies act, 2013 registration certificate is obtained by wrongful manner or illegally.<\/p>\n\n\n\n<ul><li><strong>Transfer of shares <\/strong><a href=\"https:\/\/www.mca.gov.in\/SearchableActs\/Section58.htm\" target=\"_blank\" rel=\"noreferrer noopener\">Section 58 of Companies Act, 2013<\/a><\/li><\/ul>\n\n\n\n<p class=\"has-text-align-justify\">If a company rejects or refuses the transfer of securities or shares then NCLT can intervene if the company approaches it.<\/p>\n\n\n\n<ul><li><strong>Deposits<\/strong><\/li><\/ul>\n\n\n\n<p class=\"has-text-align-justify\">Any matter arising out of deposits in a company then it can go to the tribunal.<\/p>\n\n\n\n<ul><li><strong>Power to Investigate<\/strong> <a href=\"http:\/\/corporatelawreporter.com\/companies_act\/section-213-of-companies-act-2013-investigation-into-companys-affairs-in-other-cases\/\" target=\"_blank\" rel=\"noreferrer noopener\">Section 213 of Companies Act, 2013<\/a><strong><\/strong><\/li><\/ul>\n\n\n\n<p class=\"has-text-align-justify\">It could take place in India and outside as well. Earlier, an application by 200 people was made which is now by 100 to order an investigation by NCLT.<\/p>\n\n\n\n<ul><li><strong>Freezing of assets<\/strong><\/li><\/ul>\n\n\n\n<p class=\"has-text-align-justify\">Under <a href=\"https:\/\/indiankanoon.org\/doc\/1359268\/\" target=\"_blank\" rel=\"noreferrer noopener\">Section 221 of Companies Act, 2013<\/a> NCLT can freeze the assets of a company under investigation or scrutiny.<\/p>\n\n\n\n<ul><li><strong>Converting a public limited company into private limited company<\/strong> (Section 459)<\/li><\/ul>\n\n\n\n<p class=\"has-text-align-justify\">Section 13 to 18 deals with the conversion of a company. It states that NCLT permission is required for any such action.<\/p>\n\n\n\n<ul><li><strong>Class Action<\/strong> <a href=\"http:\/\/mca.gov.in\/SearchableActs\/Section245.htm\" target=\"_blank\" rel=\"noreferrer noopener\">Section 245 of Companies Act, 2013<\/a> <strong><\/strong><\/li><\/ul>\n\n\n\n<ul><li><strong>Oppression and Mismanagement<\/strong> <a href=\"https:\/\/www.mca.gov.in\/SearchableActs\/Section241.htm\" target=\"_blank\" rel=\"noreferrer noopener\">Section 241 of Companies Act, 2013<\/a><strong><\/strong><\/li><\/ul>\n\n\n\n<ul><li><strong>Winding up of the company<\/strong><\/li><\/ul>\n\n\n\n<p class=\"has-text-align-justify\">Under <a href=\"http:\/\/ebook.mca.gov.in\/Actpagedisplay.aspx?PAGENAME=17652\" target=\"_blank\" rel=\"noreferrer noopener\">Section 242 of Companies Act, 2013<\/a>, NCLT has power to dissolve a company.<\/p>\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>NCLT is a tribunal which took over roles of various other bodies. NCLT is the adjudicating authority for all the companies in India. It makes the dispute resolution process faster in India. Instead of going to court this is a speedy mechanism which companies can go to for any redressal. &nbsp;<\/p>\n\n\n\n<p>NCLAT at New Delhi is the appellant tribunal which again helps in reducing the work load of the Supreme Court as before going to the Supreme Court a company can appeal at NCLAT. Though, the Indian Constitution provides that orders from every court or tribunal can be appealed before Supreme Court, it is the highest appellant court of the country.<\/p>\n\n\n\n<p>NCLT has changed the dispute resolution mechanism of the Indian Companies, it has treated professionals at par with lawyers and the companies have no longer need to engage into courtroom proceedings.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This article describes the concept of National Company Law Tribunal (NCLT); written by Naina solanki student of Prestige institute of management and research. Introduction The National Company Law Tribunal or NCLT is a quasi-judicial body that adjudicates matters and issues related to Indian companies which have been established under the Companies Act, 2013. Constituted on [&hellip;]<\/p>\n","protected":false},"author":167,"featured_media":6470,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[111],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.8.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Everything you should know about National Company Law Tribunal (NCLT)<\/title>\n<meta name=\"description\" content=\"This article describes the concept of National Company Law Tribunal (NCLT); written by Naina solanki student of Prestige institute....\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/lexforti.com\/legal-news\/national-company-law-tribunal-nclt\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Everything you should know about National Company Law Tribunal (NCLT)\" \/>\n<meta property=\"og:description\" content=\"This article describes the concept of National Company Law Tribunal (NCLT); 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