National Company Law Appellate Tribunal (NCLAT) is a miscellany body that acts as an advantageous and expeditious alternative to the court. This tribunal has been recently established to regulate and resolve disputes between civil corporations.
Surprisingly, there has been little awareness and knowledge about the use and importance of NCLT and its twin NCLAT.
Difference between NCLAT and NCLT:
There are two tribunals, NCLT and NCLAT. There is a little difference between these two.
NCLAT has been established as per section 410 of the Companies Act, 2013. On the other side, NCLT is established as per section 408.
NCLT holds jurisdiction primarily on cases of insolvency and bankruptcy, whereas NCLAT is primarily for holding appellate jurisdiction over the cases that are judged by NCLT
NCLT analyses and accepts all evidence from debtors and creditors. On the other hand, NCLAT analyses and accepts the decisions made by NCLT.
In short, we can understand that NCLT is for the primary collection of evidence and facts. NCLAT is one step forward. It analyses the input received from NCLT.
NCLAT:
The appellate authority for Industrial and Financial Reconstruction (AAIFR) and the power related to reconstruction and winding up lies with the high court.
Why NCLAT?
There are several benefits of NCLAT.
- It avoids multiplicity of litigation. Also, it reduces the ambiguity of reporting.
- It provides quick disposal of cases.
- It reduces unwanted difficulties.
- It reduces the load on High Court by resolving the disputes at the tribunal level.
- It is a single-window solution.
Disputing parties can present a party in a proceeding or appeal. They can represent themselves or appoint an authorized person to represent them.
Typically, the representative can be Company Secretaries, Chartered Accountants, Legal Practitioners, Cost Accountants, or an officer of the company.
The government of India has constituted 15 tribunal benches in various major cities such as Metro cities, Tier 1 and Tier 2 cities. There is one appellate tribunal bench is in New Delhi.
The age limit for the appointment as a member of the tribunal is 50 years. The member might retain his lien with his existing ministry or cadre or department. Holding office as such for a period not more than one year.
Conclusion:
The NCLT is a specialized court only for Indian corporations. It is a simple tribunal for corporate members in India which helps to reduce the number of legal battles before different courts and forums and NCLT can deliver justice at a quicker pace.