The Tribunal and the Appellate Tribunal

In one line

The Central Government constitutes the National Company Law Tribunal of a President and Judicial and Technical Members, and above it the Appellate Tribunal of a Chairperson and Members; both sit in benches, are not bound by the Code of Civil Procedure but by natural justice, have a civil court's powers and the power to punish for contempt; appeals lie to the Appellate Tribunal within forty-five days and from it to the Supreme Court on a question of law within sixty; and no civil court may entertain what the Tribunal is empowered to decide.

In exam wording: section 408 constitutes the Tribunal, section 410 the Appellate Tribunal, section 421 the appeal, section 423 the appeal to the Supreme Court, section 424 the procedure, and section 430 the ouster of the civil court.

Why the law has this at all

Before the 2013 Act, company matters were divided among three forums: the High Court wound companies up and sanctioned schemes, the Company Law Board heard oppression petitions, and the Board for Industrial and Financial Reconstruction dealt with sick companies. A single dispute could therefore be split three ways, and the High Court's company jurisdiction competed for time with its ordinary work.

The Tribunal was created to gather all of it into one specialist forum, and the design follows from that purpose.

It is a mixed bench, one Judicial and one Technical Member, because company disputes turn as much on accounts and finance as on law.

It is not bound by the Code of Civil Procedure, because a winding up or a scheme is an administration rather than a lis, and it needs to move faster than a suit.

It has a civil court's coercive powers and the power to commit for contempt, because a forum that gathers assets must be able to compel.

And section 430 shuts the civil court out, because the whole gain would be lost if the same questions could be reopened in a suit.

Some words this chapter uses

A Judicial Member is a Member qualified by judicial or advocacy experience. A Technical Member is qualified by professional or service experience. A Bench is the constituted sitting that exercises the Tribunal's powers. A mistake apparent from the record is an error visible without argument. Natural justice requires notice and a hearing by an impartial decider.

Constitution: sections 407 to 412

Section 408. The Central Government shall, by notification, constitute a Tribunal to be known as the National Company Law Tribunal, consisting of a President and such number of Judicial and Technical Members as it deems necessary, to exercise the powers conferred by or under this Act or any other law for the time being in force.