The proposal for the formation of the National Company Law Tribunal has temporarily been kept in ‘abeyance’ at the moment, according to the Central Government. The establishment of the National Company Law Tribunal has been challenged in the Supreme Court.
The entire process of establishing the NCLT has been put in cold storage, as certain relevant provisions of the Companies Act, 2013 were challenged before the Supreme Court. The provisions under scrutiny relate to the constitution and composition of NCLT.
The information was provided via a written communication to LokSabha by the Coporate Affairs Minister ArunJaitley. The reply also stated that the establishment of NCLT benches in different states across the country is under question and a decision on the same can only be made final after the case relating to NCLT is resolved in the Supreme Court.
The Government planned to set up the National Company Law Tribunal under the newly enacted Companies Act, 2013. The National Company Law Tribunal is to be established as a quasi-judicial body. The mandate of the Tribunal is to adjudicate upon matters dealing with corporate and company relate disputes. While the principal bench of the tribunal is to be set up in New Delhi, several other benches are touted to be set up in various states. The number of such benches could range from 12 to 13, across the country.
The National Company Law Tribunal would have the jurisdiction to deal with the disputes which were earlier within the power of Company Law Board, Board of Industrial and Financial Reconstruction and High Courts. As such, the scope of NCLT’s power shall extend to disputes relating to oppression and mismanagement, sick companies and their revival and winding up procedure with respect to companies. The orders of the National Company Law Tribunal are appealable in the National Company Law Appellate Tribunal.
by Siddhartha Singh.