The general procedures relating to the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) are specified in the NCLT Rules, 2016, and NCLAT Rules, 2016. Many provisions are common to both tribunals, though some minor deviations exist. Where procedures are common, references to both sets of rules are given. This discussion first covers procedures applicable to both NCLT and NCLAT, followed by procedures specific to each tribunal.
The NCLT Rules, 2016, also provide specific procedures concerning various sections of the Companies Act, 2013, under which the NCLT has the authority to pass orders. These specific provisions are discussed under the respective sections of the Companies Act.
The overview of procedures before NCLT as prescribed by the National Company Law Tribunal Rules, 2016, notified on July 21, 2016, includes provisions for both the internal management of the tribunal and the procedural aspects of case handling.
The powers and functions of the President of NCLT are outlined iRulele 16 of the NCLT Rules, 2016. Similarly, the powers and functions of the Registrar of NCLT are specified in Rule 17. There is a Secretary at the Principal Bench of the NCLT located in Delhi, whose powers and functions are described in Rule 18.
Appeals, petitions, applications, caveats, objections, or counters before NCLT must be presented in English and submitted in triplicate. These documents must be typed or printed in double spacing on standard paper with proper margins as per rules 20 and 21. The documents should be indexed and stitched into a paper book form.
Appeals should be divided into consecutively numbered paragraphs. Every appeal, application, caveat, or petition must be submitted in triplicate and accompanied by a certified copy of the order being appealed against. One copy of the appeal must be provided to the opposite party.
All proceedings before the tribunal, including advertisements and notices, use the general heading in the form NCLT.4. Petitions, applications, or references use form NCLT.1. This must be accompanied by form NCLT.2, which serves as the Notice of Admission and practically fulfills the office’s duty in this regard. In interlocutory applications, form NCLT.1 should be accompanied by form NCLT.3. All petitions or applications, including interlocutory ones, must be verified in form NCLT.6. Notices to the opposite party use form NCLT.5. Advertisements, if required, must be in form NCLT.3A, as outlined in rule 35.
Appeals must be accompanied by the prescribed fees, envelopes, and notice forms as specified. The fee structure is prescribed in Rule 165 of the NCLT Rules, 2016. Fees must be paid by demand draft drawn in favor of the Pay and Accounts Officer, Ministry of Corporate Affairs, with location depending on the bench jurisdiction (New Delhi, Kolkata, Chennai, Mumbai).
Appeals should be filed either in person or through an authorized representative. Upon submission, an acknowledgment is given. If any defects are found in the documents, the appeal is returned for rectification.
If affidavits are required, they must be fileDaaw Form NCLT.7, by the requirements detailed in rules 125 to 230 of the NCLT Rules.
Special procedures for various applications, petitions, or appeals under different sections of the Companies Act, 2013, are specified in rules 66 to 88 of the NCLT Rules. The list of documents required in each case is detailed in Annexure 8 of the NCLT Rules.
Parties may appear in person or through authorized representatives. Appearance is made by filing a vakalatnama or memorandum of appearance in form NCLT.12. Authorized representatives may apply to the Registrar in form NCLT.10 to appoint interns who may access records and obtain copies of tribunal orders.
Witnesses can be examined on oath. If a petitioner appears and the respondent does not, the NCLT may pass an ex parte order on merit.
Applications for execution of orders must be made using form NCLT.8. Applications for rectification of orders may be filed in form NCLT.9 within two years of the order, as per rule 154.
Orders passed by the NCLT should be filed with the Registrar of Companies (ROC) in form INC.28, accompanied by the requisite fees.
General Powers of NCLT and NCLAT
The tribunals possess certain general powers to facilitate justice and efficient functioning.
NCLT and NCLAT have the power to exempt parties from compliance with any procedural requirements upon showing sufficient cause. This is provided undeRulele 14 of both NCLT and NCLAT Rules. The tribunals may give such directions in matters of practice and procedure as considered just and expedient to ensure substantial justice.
The tribunals also have the power to extend the time for doing any act or taking any proceeding fixed by the rules or any order. This extension can be granted even after the expiry of the prescribed time, subject to the justice of the case, as per rule 15 of both tribunals’ rules.
Both tribunals enjoy inherent powers under Rule 11 of the NCLT and NCLAT Rules to make any orders necessary for meeting the ends of justice or to prevent abuse of the tribunal’s process. These inherent powers allow tribunals to act flexibly in exceptional circumstances to ensure fairness.
A more detailed discussion on the inherent powers of NCLT and NCLAT follows in a dedicated chapter.
Timings and Sittings of NCLT and NCLAT
The NCLT may hold sittings at its headquarters or other locations within its territorial jurisdiction that it finds convenient, allowing for circuit benches. This flexibility is granted under Rule 8 of the NCLT Rules.
NCLAT sittings are held exclusively at its headquarters in New Delhi, with no provision for circuit benches.
The sitting hours of NCLT ordinarily are from 10:30 AM to 1:00 PM and then from 2:00 PM to 4:30 PM.
The sitting hours of NCLAT are from 9:30 AM to 1:00 PM and 2:15 PM to 5:00 PM.
The offices of both tribunals remain open on all working days from 9:30 AM to 6:00 PM.
The filing counters at the registries of NCLT and NCLAT are open on all working days from 10:30 AM to 5:00 PM.
Listing of Urgent Cases
Urgent matters filed before noon are listed before the tribunal on the following working day, provided the filings are complete as per the rules. In exceptional cases, matters filed after 12 noon but before 3:00 PM may also be considered for listing the next day with specific permission from the bench.
Institution of Proceedings, Petitions, and Appeals before NCLT and NCLAT
The procedures for instituting proceedings before the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) are governed by Rule 20 of the NCLT Rules, 2016, and Rule 19 of the NCLAT Rules, 201,6, respectively.
Every appeal, petition, application, caveat, objection, or counter presented before the tribunals must be in English. If the document is in any other Indian language, it must be accompanied by a translation in English. This ensures uniformity and clarity in proceedings.
The documents must be fairly and legibly typewritten, lithographed, or printed in double spacing on one side of standard petition paper. There should be an inner margin of about four centimeters at the top, a right margin of 2.5 centimeters, and a left margin of 5 centimeters. The documents should be paginated, indexed, and stitched together in paper book form for easy reference.
The cause title of every appeal, petition, or application must clearly state “Before the National Company Law Tribunal” or “Before the National Company Law Appellate Tribunal,” specifying the Bench to which the matter is presented. It must also set out the proceedings or order of the authority against which the appeal or petition is preferred.
The appeal or petition should be divided into paragraphs and numbered consecutively. Each paragraph should contain as nearly as possible a separate fact, allegation, or point to ensure clarity and logical presentation.
Immediately after the cause title, the provision of law under which the appeal or petition is preferred must be stated. This helps the tribunal understand the legal basis of the case at the outset.
Full details of each party, including name, parentage, age, description, and address, must be provided at the beginning of the appeal or petition. If a party is suing or being sued in a representative capacity, this must be indicated as well. These details need not be repeated in subsequent documents in the same manner.
Each party must be assigned a consecutive number, with a separate line allotted to their name and description. These numbers remain fixed throughout the proceedings. If a party dies during the pendency of the case, their legal heirs or representatives are assigned sub-numbers. Fresh parties introduced later are numbered consecutively within their category.
Particulars to be Set Out in the Address for Service
Every appeal, petition, application, or caveat must include an address for service of summons on behalf of each party. This address should, as far as possible, contain all relevant details such as telephone numbers and email addresses to facilitate prompt service. These requirements are set out in Rule 21 of the NCLT Rules and Rule 20 of the NCLAT Rules.
Initialling Alterations
Any interlineations, erasures, corrections, or deletions in any appeal, petition, application, or document must be initialed by the party or their authorized representative who presents the document. This ensures the authenticity of alterations and prevents unauthorized changes.
Production of Authorization for and on Behalf of Associations
When proceedings are instituted by or on behalf of an association, the person(s) who sign or verify the document must produce a true copy of the association’s resolution authorizing them to do so. This document should also include the list of members for whose benefit the proceedings are instituted.
The Registrar of the tribunal may call upon the party to produce further materials to satisfy himself regarding due authorization at any time during the proceedings.
Presentation of Petition or Appeal
Petitions, applications, caveats, interlocutory applications, and appeals must be presented in triplicate physically and not by post. They can be filed in person or through an authorized representative or advocate. The prescribed forms must be used and the requisite fees paid at the filing counter.
Non-compliance with these requirements can be a valid ground for refusal to entertain the matter.
All accompanying documents must be duly certified by the authorized representative or advocate filing the documents. The certification confirms the authenticity and correctness of the documents based on originals.
Documents filed must be accompanied by an index in triplicate containing their details and the fee paid.
Sufficient copies of appeals or petitions must be filed for service on the opposite party as required by the rules.
In pending matters, all applications must be presented only after serving copies in advance on the opposite party or their authorized representative.
The term “certified” means a copy certified under section 76 of the Indian Evidence Act, 1872, or section 6 of the Information Technology Act, 2000, or certified copies issued by the Registrar of Companies, or copies downloaded from online portals under section 398 of the Companies Act, 2013, duly certified by legal practitioners, chartered accountants, cost accountants, or company secretaries in practice.
Fees Payable with Application, Petition, or Appeal
The Central Government is empowered under section 459(2) of the Companies Act, 2013, to prescribe fees payable on applications before the NCLT for approvals, sanctions, consents, confirmations, directions, or other matters.
The schedule of fees is specified in the NCLT Rules, 2016, and NCLAT Rules, 2016. Fees are applicable even for interlocutory applications. Payments must be made by demand draft drawn in favor of the Pay and Accounts Officer, Ministry of Corporate Affairs, at the location determined by the President of NCLT.
Fees for appeals before NCLAT are also prescribed. For example, the fee for an appeal concerning the protection of an employee during investigation under section 218(3) of the Companies Act is Rs 1,000. The fee for appeals under section 421(1) is Rs 5,000.
Copies of Petition or Application and Delivery to Opposite Party
Three authenticated copies of petitions, appeals, applications, counters, or objections must be filed, and one copy must be delivered to each opposite party. This ensures all parties have access to the documents and maintain fairness in the proceedings.
Endorsement and Verification on Petition or Appeal
Each petition, appeal, or pleading must bear the name and signature of the authorized representative at the foot. The document must also be signed and verified by the concerned party in the manner prescribed by the rules. Verification confirms the truthfulness of the facts presented.
Translation of Documents
Any document in a language other than English intended to be used before the NCLT or NCLAT must be accompanied by an English translation. This translation must be agreed upon by both parties or certified as a true translation by authorized representatives or advocates.
For NCLAT, only certification by the authorized representative engaged in the case is acceptable.
No appeal or petition is set down for hearing until all parties confirm that all documents relied upon are either in English or translated into English, and the required copies are filed with the tribunal.
Lodging of Caveat before NCLT
Any person may lodge a caveat in triplicate in respect of any appeal, petition, or application likely to be instituted before the NCLT. This requires payment of the prescribed fee and forwarding a copy by registered post or by serving it on the expected petitioner or appellant.
The caveat must be in the prescribed form and contain details such as the particulars of the expected appeal, petition, or application, details of the authority against whose orders or directions the proceedings are expected to be instituted, and the full address for service on the other side. This ensures that the caveator is served notice before the appeal or petition, or the interim application is taken up.
The caveat remains valid for ninety days from the date of filing. The NCLT may pass interim orders in urgent cases where a caveat has been lodged to protect the caveator’s interest.
There is no specific provision for filing a caveat before NCLAT in the NCLAT Rules, 2016. However, the absence of such a provision does not imply that a caveat cannot be filed before the Appellate Tribunal.
Interlocutory Applications
Interlocutory applications include requests for stay, directions, condonation of delay, exemption from production of certain documents, or extension of time in pending matters. These must be filed in the prescribed form NCLT.1 accompanied by Form NCLT.3 and supported by an affidavit, as provided in Rule 32 of the NCLT Rules, 2016.
All petitions or applications, including interlocutory applications, require verification by affidavit in Form NCLT.6.
Any person aggrieved by an order or decision of the NCLT, including interim orders, may prefer an appeal to the NCLAT under section 421(1) of the Companies Act, 2013.
The Supreme Court in Purnima Manthena v. Dr Renuka Datla held that while hearing appeals against interim orders, the Appellate Tribunal should not undertake an elaborate review of facts or records not considered by the lower tribunal. The hearing should focus on whether there has been an error or miscarriage of justice in the interim order.
Applications for interlocutory orders before NCLAT must be filed in the prescribed form NCLAT.2 according to Rule 31 of the NCLAT Rules, 2016.
Filing and Service of Documents
All documents, including petitions, appeals, caveats, interlocutory applications, and counters, must be physically presented in triplicate and cannot be submitted by post. They can be filed personally or through authorized representatives or advocates.
Documents must be accompanied by the appropriate fees, and certified copies of all annexures should be submitted. Certified copies ensure the authenticity and correctness of documents based on originals.
Sufficient copies must be filed for service on opposite parties to maintain fairness and procedural compliance.
In cases already pending before the tribunal, all new applications must be served on the opposing party in advance of presentation to the tribunal.
Certification of Documents
The term “certified” for documents filed before the NCLT or NCLAT includes certification under section 76 of the Indian Evidence Act, 1872, or section 6 of the Information Technology Act, 2000. It also includes certified copies issued by the Registrar of Companies or documents downloaded from online portals under section 398 of the Companies Act, 2013, duly certified by legal practitioners, chartered accountants, cost accountants, or company secretaries in practice.
This certification process ensures that the documents submitted are genuine and can be relied upon in proceedings.
Appeal Process and Fees
Fees payable to file applications, petitions, or appeals before NCLT and NCLAT are prescribed by the Central Government under section 459(2) of the Companies Act, 2013. These fees cover approvals, sanctions, consents, confirmations, directions, and other types of applications.
The fee schedule is part of the NCLT and NCLAT Rules, 2016. Fees must be paid by demand draft in favor of the Pay and Accounts Officer, Ministry of Corporate Affairs, at the appropriate location.
Interlocutory applications also require payment of fees.
For appeals before NCLAT, fees vary based on the nature of the appeal. For example, the fee for an appeal concerning the protection of an employee during investigation is Rs 1,000, while other appeals under section 421(1) attract a fee of Rs 5,000.
Verification and Endorsement
Every petition, appeal, or pleading must be signed and verified by the party or their authorized representative, confirming the truth of the facts contained within.
The endorsement includes the name and signature of the authorized representative at the foot of the document. This step establishes the accountability of the parties involved.
Language and Translation Requirements
Documents filed in any language other than English must be accompanied by a certified English translation.
For NCLT proceedings, translations can be certified by authorized representatives engaged on behalf of the parties, other advocates or representatives, or translators approved by the Registrar upon payment of prescribed charges.
For NCLAT proceedings, only certification by authorized representatives engaged in the case is accepted.
No petition or appeal is scheduled for hearing unless all parties confirm that all documents relied upon are available in English or as certified English translations. The required number of copies must also be filed.
Powers to Exempt and Extend Time
NCLT and NCLAT have the discretionary power to exempt parties from compliance with any procedural requirements when sufficient cause is shown. This power allows the tribunals to issue directions in matters of practice and procedure to ensure that substantial justice is served. The tribunals may act to prevent rigid procedural technicalities from defeating the rights of parties.
The tribunals may also extend the time for doing any act or taking any proceeding, even after the prescribed time has expired. Extensions may be granted on such terms as the tribunals deem just and necessary to prevent injustice.
These powers enable flexibility in procedural matters and help the tribunals to adapt to circumstances, ensuring the process is fair and equitable.
Inherent Powers of NCLT and NCLAT
Both tribunals possess inherent powers to make any order necessary for meeting the ends of justice or to prevent abuse of their processes. These inherent powers are wide-ranging and allow the tribunals to address situations not explicitly covered by procedural rules but where intervention is required to uphold justice.
Such powers may be exercised to prevent procedural abuse, delay tactics, or unfair practices that could compromise the integrity of proceedings.
The use of inherent powers is subject to judicial prudence and must be exercised judiciously, balancing the interests of justice and procedural fairness.
Execution and Rectification of Orders
Applications for execution of orders passed by the NCLT are filed in form NCLT.8. This enables enforcement of the tribunal’s directions and ensures compliance by the parties.
If any party finds an error or omission in an order, an application for rectification can be made in form NCLT.9 within two years of the date of the order. The tribunal may correct clerical or arithmetical mistakes or any errors arising from accidental slips or omissions.
Timely rectification ensures that orders accurately reflect the tribunal’s intent and preventunnecessary litigation arising from procedural inaccuracies.
Filing of Orders with Registrar of Companies
Orders passed by the NCLT must be filed with the Registrar of Companies (ROC) using Form INC.28 along with the prescribed fees. Filing the order with the ROC ensures that the order is officially recorded and becomes effective for the purposes intended under the Companies Act.
Compliance with this requirement is essential for the legal validity of the tribunal’s orders in company law matters.
Sitting Hours and Registry Functioning
NCLT sittings typically run from 10:30 AM to 1:00 PM and 2:00 PM to 4:30 PM. NCLAT sittings run from 9:30 AM to 1:00 PM and 2:15 PM to 5:00 PM.
The offices of both tribunals remain open from 9:30 AM to 6:00 PM on all working days. Filing counters are available from 10:30 AM to 5:00 PM.
This schedule facilitates efficient case management and accessibility for parties and their representatives.
Conclusion
The procedural framework governing NCLT and NCLAT is designed to ensure orderly and fair adjudication of company law disputes. While the rules provide detailed guidance on filing, presentation, verification, and conduct of proceedings, the tribunals retain flexibility through powers to exempt, extend time, and exercise inherent jurisdiction to meet the ends of justice.
Strict adherence to the procedural rules is essential to avoid dismissal or delays. However, the tribunals’ powers to relax procedural requirements promote access to justice and prevent undue hardship caused by rigid formalities.
Understanding these procedural aspects is crucial for practitioners and parties involved in proceedings before the NCLT and NCLAT, ensuring effective navigation of the legal process.