The Companies Act, 2013 establishes a comprehensive legal framework with specialized judicial bodies to address corporate disputes and regulatory matters. This document outlines the key adjudicatory forums under the Act.
Primary adjudicating authority for corporate matters. The NCLT has jurisdiction over:
Important Notes:
Please be advised that cases falling under the jurisdiction of the National Company Law Tribunal (NCLT) cannot be adjudicated by civil courts. Consequently, any violations not explicitly covered under the Companies Act, but arising from the same cause of action related to the Companies Act, 2013, must be addressed by the NCLT to prevent duplication of litigation.
Additionally, if the case involves violations of Securities and Exchange Board of India (SEBI) regulations, there will be concurrent proceedings before the Securities Appellate Tribunal (SAT). Offenses under the Prevention of Money Laundering Act (PMLA) will be addressed by the Enforcement Directorate (ED).
Orders issued by Regional Directors cannot be appealed through the NCLT; aggrieved parties must approach the High Court under its writ jurisdiction.
In cases involving compounding of offenses, the Registrar of Companies can only impose the maximum statutory penalty with no discretion to reduce it, and no appeal mechanism is provided.
Appellate authority for NCLT decisions. The NCLAT hears appeals against:
NCLAT decisions can be challenged before the Supreme Court of India only on the question of law.
Established for expeditious trial of corporate offenses
Special Courts handle:
Offenses punishable with imprisonment of 2 years or more fall under the jurisdiction of Special Courts.
Section 452, concerning wrongful withholding of property, represents an exception to the general jurisdictional framework. Cases under this section are exclusively handled by Metropolitan Magistrates, as neither the NCLT nor Special Courts have jurisdiction in such matters.
The Central Government may direct the SFIO to investigate a company’s affairs in the following circumstances:-
This is used as a tool by the shareholders of the company as they can simply pass a special resolution to investigate the affairs of the company and the Central Government, if it is satisfied, might start the investigation.
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