National Company Law Tribunal (NCLT) (Part -2) - Winding Up, Company Law | Company Law - B Com PDF Download

Orders of Tribunal (Section 420)

Section 420 of the Act contains the provisions as to Orders of Tribunal. According to this Section:

1. The Tribunal may, after giving the parties to any proceeding before it, a reasonable opportunity of being heard, pass such orders thereon as it thinks fit.
2. The Tribunal may, at any time within two years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it, and shall make such amendment, if the mistake is brought to its notice by the parties. Provided that no such amendment shall be made in respect of any order against which an appeal has been preferred under this Act.
3. The Tribunal shall send a copy of every order passed under this Section to all the parties concerned.

Appeal from orders of Tribunal (Section 421) 

Section 421 of the Act contains the provisions as to Appeal from orders of Tribunal. According to this Section:

1. Any person aggrieved by an order of the Tribunal may prefer an appeal to the Appellate Tribunal.
2. No appeal shall lie to the Appellate Tribunal from an order made by the Tribunal with the consent of parties.
3. Every appeal under Sub-Section (1) shall be filed within a period of forty-five days from the date on which a copy of the order of the Tribunal is made available to the person aggrieved and shall be in such form, and accompanied by such fees, as may be prescribed. Provided that the Appellate Tribunal may entertain an appeal after the expiry of the said period of forty five days from the date aforesaid, but within a further period not exceeding forty-five days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within that period.
4. On the receipt of an appeal under Sub-Section (1), the Appellate Tribunal shall, after giving the parties to the appeal a reasonable opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order appealed against.
5. The Appellate Tribunal shall send a copy of every order made by it to the Tribunal and the parties to appeal.

Expeditious disposal by Tribunal and Appellate Tribunal (Section 422). 

Section 422 of the Act contains the provisions as to Expeditious disposal by Tribunal and Appellate Tribunal. According to this Section:

• Every application or petition presented before the Tribunal and every appeal filed before the Appellate Tribunal shall be dealt with and disposed of by it as expeditiously as possible and every endeavour shall be made by the Tribunal or the Appellate Tribunal, as the case may be, for the disposal of such application or petition or appeal within three months from the date of its presentation before the Tribunal or the filing of the appeal before the Appellate Tribunal.
• Where any application or petition or appeal is not disposed of within the period specified in Sub-Section (1), the Tribunal or, as the case may be, the Appellate Tribunal, shall record the reasons for not disposing of the application or petition or the appeal, as the case may be, within the period so specified and the President or the Chairperson, as the case may be, may, after taking into account the reasons so recorded, extend the period referred to in Sub-Section (1) by such period not exceeding ninety days as he may consider necessary.

Appeal to Supreme Court (Section 423) 

Section 423 of the Act contains the provisions as to Appeal to Supreme Court. According to this Section:

Any person aggrieved by any order of the Appellate Tribunal may file an appeal to the Supreme Court within sixty days from the date of receipt of the order of the Appellate Tribunal to him on any question of law arising out of such order.

Provided that the Supreme Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.

Procedure before Tribunal and Appellate Tribunal (Section 424)

Section 424 of the Act contains the provisions as to Procedure before Tribunal and Appellate Tribunal (Section 424). According to this Section:

(a) The Tribunal and the Appellate Tribunal shall not, while disposing of any proceeding before it or, as the case may be, an appeal before it, be bound by the procedure laid down in the Code of Civil Procedure, 1908, but shall be guided by the principles of natural justice, and, subject to the other provisions of this Act and of any rules made thereunder, the Tribunal and the Appellate Tribunal shall have power to regulate their own procedure.

(b) The Tribunal and the Appellate Tribunal shall have, for the purposes of discharging their functions under this Act, the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 while trying a suit in respect of the following matters, namely:

1. summoning and enforcing the attendance of any person and examining him on oath.
2. requiring the discovery and production of documents.
3. receiving evidence on affidavits.
4. subject to the provisions of Sections 123 and 124 of the Indian Evidence Act, 1872, requisitioning any public record or document or a copy of such record or document from any office.
5. issuing commissions for the examination of witnesses or documents.
6. dismissing a representation for default or deciding it 'ex parte'.
7. setting aside any order of dismissal of any representation for default or any order passed by it 'ex parte', and
8. any other matter which may be prescribed.

(c) Any order made by the Tribunal or the Appellate Tribunal may be enforced by that Tribunal in the same manner as if it were a decree made by a court in a suit pending therein, and it shall be lawful for the Tribunal or the Appellate Tribunal to send for execution of its orders to the court within the local limits of whose jurisdiction:

1. in the case of an order against a company, the registered office of the company is situate, or
2. in the case of an order against any other person, the person concerned voluntarily resides or carries on business or personally works for gain.

(d) All proceedings before the Tribunal or the Appellate Tribunal shall be deemed to be judicial proceedings within the meaning of Sections 193 and 228, and for the purposes of Section 196 of the Indian Penal Code, and the Tribunal and the Appellate Tribunal shall be deemed to be civil court for the purposes of Section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973. 

Power to punish for contempt (Section 425)

Section 425 of the Act contains the provisions as to Powers of the NCLT and NCLAT to punish for contempt. According to this Section:

The Tribunal and the Appellate Tribunal shall have the same jurisdiction, powers and authority in respect of contempt of themselves as the High Court has and may exercise, for this purpose, the powers under the provisions of the Contempt of Courts Act, 1971, which shall have the effect subject to modifications that:

• the reference therein to a High Court shall be construed as including a reference to the Tribunal and the Appellate Tribunal, and
• the reference to Advocate-General in Section 15 of the said Act shall be construed as a reference to such Law Officers as the Central Government may, specify in this behalf.

Delegation of powers (Section 426) 

Section 426 of the Act contains the provisions as to Delegation of powers by NCLT and NCLAT. According to this Section:

The Tribunal or the Appellate Tribunal may, by general or special order, direct, subject to such conditions, if any, as may be specified in the order, any of its officers or employees or any other person authorised by it to inquire into any matter connected with any proceeding or, as the case may be, appeal before it and to report to it in such manner as may be specified in the order.

President, Members, Officers, etc., to be Public Servants (Section 427)

Under this Section, the President, Members, officers and other employees of the Tribunal and the Chairperson, Members, Officers and other employees of the Appellate Tribunal shall be deemed to be public servants within the meaning of Section 21 of the Indian Penal Code.

Protection of action taken in good faith (Section 428)

Under this Section, no suit, prosecution or other legal proceeding shall lie against the Tribunal, the President, Member, officer or other employee, or against the Appellate Tribunal, the Chairperson, Member, officer or other employees thereof or liquidator or any other person authorised by the Tribunal or the Appellate Tribunal for the discharge of any function under this Act in respect of any loss or damage caused or likely to be caused by any act which is in good faith done or intended to be done in pursuance of this Act.

Power to seek assistance of Chief Metropolitan Magistrate, etc. (Section 429)

Section 429 of the Act contains the provisions as to Power of the Tribunal to seek assistance of Chief Metropolitan Magistrate. According to this Section:

1. The Tribunal may, in any proceeding relating to a sick company or winding up of any other company, in order to take into custody or under its control all property, books of account or other documents, request, in writing, the Chief Metropolitan Magistrate, Chief Judicial Magistrate or the District Collector within whose jurisdiction any such property, books of account or other documents of such sick or other company, are situate or found, to take possession thereof, and the Chief Metropolitan Magistrate, Chief Judicial Magistrate or the District Collector, as the case may be, shall, on such request being made to him:
   • take possession of such property, books of account or other documents, and
   • cause the same to be entrusted to the Tribunal or other person authorized by it.
2. For the purpose of securing compliance with the provisions of Sub-Section (1), the Chief Metropolitan Magistrate, Chief Judicial Magistrate or the District Collector may take or cause to be taken such steps and use or cause to be used such force as may, in his opinion, be necessary.
3. No act of the Chief Metropolitan Magistrate, Chief Judicial Magistrate or the District Collector done in pursuance of this Section shall be called in question in any court or before any authority on any ground whatsoever.

Civil court not to have jurisdiction (Section 430) 

Under this Section, no civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under this Act or any other law for the time being in force and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or any other law for the time being in force, by the Tribunal or the Appellate Tribunal.

Vacancy in Tribunal or Appellate Tribunal not to invalidate acts or proceedings. (Section 431)

Under this Section, no act or proceeding of the Tribunal or the Appellate Tribunal shall be questioned or shall be invalid merely on the ground of the existence of any vacancy or defect in the constitution of the Tribunal or the Appellate Tribunal, as the case may be.

Right to legal representation (Section 432).

According to this Section, a party to any proceeding or appeal before the Tribunal or the Appellate Tribunal, as the case may be, may either appear in person or authorise one or more Chartered Accountants or Company Secretaries or Cost Accountants or legal practitioners or any other person to present his case before the Tribunal or the Appellate Tribunal, as the case may be.

Limitation (Section 433)

In terms of Section 433 of the Act, the provisions of the Limitation Act, 1963 shall, as far as may be, apply to proceedings or appeals before the Tribunal or the Appellate Tribunal, as the case may be.

Transfer of certain pending proceedings (Section 434)

Section 434 of the Act contains the provisions as to Transfer of certain pending proceedings. According to this Section:

(a) On such date as may be notified by the Central Government in this behalf:

1. all matters, proceedings or cases pending before the Board of Company Law Administration shall stand transferred to the Tribunal and the Tribunal shall dispose of such matters, proceedings or cases in accordance with the provisions of this Act.
2. any person aggrieved by any decision or order of the Company Law Board made before such date may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Company Law Board to him on any question of law arising out of such order.
3. all proceedings under the Companies Act, 1956, shall stand transferred to the Tribunal and the Tribunal may proceed to deal with such proceedings from the stage before their transfer.
4. any appeal preferred to the AAIFR or any reference made or inquiry pending to or before the BIFR under the Sick Industrial Companies (Special Provisions) Act, 1985 immediately before the commencement of this Act shall stand abated,

(b) The Central Government may make rules consistent with the provisions of this Act to ensure timely transfer of all matters, proceedings or cases pending before the Company Law Board or the courts, to the Tribunal under this Section.