Ministry of Corporate Affairs has issued three notifications dated 01 June 2016 (attached) for setting up of National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) as well as notifying various sections of the Companies Act 2013 (which were not operational due to non constitution of NCLT) with effect from 01st June 2016. With this Company Law Board (CLB) to stand dissolved per section 466 of the Companies Act 2013.
Per media reports,
NCLAT Chairperson:- Justice SJ Mukhopadhaya, Judge (Retired), Supreme Court of India
NCLT President:- Justice MM Kumar, Judge (Retd.), Seems to be same person who is currently Chairman of CLB;
Chandigarh; Allahabad; Ahmedabad; Bengluru; Hyderabad; an Guwahati.
It''s not clear where NCLAT would be situated. Appointment of members of NCLT and NCLAT is not yet made/announced. Per section 466 of the Companies Act 2013, existing members and staff would be members and staff of NCLT. Also related Rules are yet to be notified.
It is interesting to note that the Companies (Amendment) Bill 2016 which provided for amendments to the Companies Act 2013 included amendment to be made on constitution of NCLT and NCLAT in line with the Judgement of the Supreme Court in Madras Bar Association''s case decided on 14 May 2015. The Government has gone ahead without the said Bill being passed (which is currently before the Parliamentary Standing Committee) .
It appears that, to begin with, only powers of CLB and other powers under Companies Act 2013 (excluding reduction of capital, winding-up and compromise/arrangement) would be exercised by NCLT and appeal therefrom would be before NCLAT instead of High Court. Gradually powers of High Court under the Companies Act 2013 / 1956 relating to reduction of share capital, winding-up and compromise or arrangement (merger, demerger, settlement) would get transferred to NCLT.
If the Central Government takes time to notify provisions of the Insolvency and Bankruptcy Code 2016, then matters before BIFR and AAIFR would also be dealt by NCLT and NCLAT respectively. However, to avoid confusion it is advisable that the Government may avoid delegating authority relating to sick companies to NCLT and NCLAT under Companies Act 2013.
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