National Company Law Tribunal (NCLT)
- One of the most celebrated provisions of the legislation is the setting up of National Company Law Tribunal.
- National Company Law Tribunal has been set up under Part IB of the legislation
- It is unique because this National Company Law Tribunal will have the combined powers of Company Law Board, BIFR and also the High Courts.
- Section 10 FC of the legislation gives the constitution of the NCLT. It shall consist of the total 63 members.
- One will be the President and 31 members each as judicial and technical members. The NCLT will be constituted of 2 members and there will be 31 benches located throughout India.
The rationale behind having 31 benches is to have benches in places which have a High Court jurisdiction because this tribunal covers the functions of High Courts in matters of Company Law.
Qualifications of members
- The constitution of the NCLT will be having technical members and judicial members. But, the eligibility criterion for choosing a technical member leaves much to be desired.
- A technical member can be chosen from various fields of experience including administrative services. It must be understood by the drafters that the post of a technical member does not really require experience in bureaucracy.
- What is needed is the technical know-how which can come by taking members from public policy think tanks, researchers, professors but the experience in administration or the IAS officials are not endowed with qualities required of a technical member. So, the researcher feels that the provision relating to inclusion of administrative members as technical members should be deleted.
- The other kinds of persons who constitute the NCLT are the judicial members. The persons working in the Labour Court, National Tribunal as magistrates should be considered for judicial members should only be occupied by practicing advocates or members from judiciary like magistrates and members from administration should not be made eligible for the post.
- This is because, what is required of a judicial member is the working knowledge of law which can come only to lawyers or members of judiciary.
Another provision of the legislation which needs to be amended is provison to section 10FE. It states that “the President or other members can retain their lien with his parent cadre or Ministry or Department while holding office as such.
The aim of grant of lien to the members seems only to make the members complacent in their work as they will be thinking that they have another avenue to work. Section 10FE could come in way of producing committed members of the NCLT.
It must be noted that the work assigned to the members will be a lot and to do the work efficiently will require full dedication which cannot be achieved if the option of lien is available to the members. So, the proviso to Section 19 FE should be suitably amended so as to take way the grant of lien.
MEANING OF COMPANY
The word ‘company’ is derived from the Latin word (Com=with or together; panis =bread), and it originally referred to an association of persons who took their meals together. In the leisurely past, merchants took advantage of festive gatherings, to discuss business matters.
Nowadays, the business matters have become more complicated and cannot be discussed at festive gatherings. Therefore, the company form of organization has assumed greater importance. It denotes a joint stock enterprise in which the capital is contributed by several people. Thus, in popular parlance, a company denotes an association of likeminded persons formed for the purpose of carrying on some business or undertaking. A company is a corporate body and a legal person having status and personality distinct and separate from the members constituting it.
It is called a body corporate because the persons composing it are made into one body by incorporating it according to the law and clothing it with legal personality. The word ‘corporation’ is derived from the Latin term ‘corpus’ which means ‘body’.
Accordingly, ‘corporation’ is a legal person created by a process other than natural birth. It is, for this reason, sometimes called artificial legal person. As a legal person, a corporate is capable of enjoying many of the rights and incurring many of the liabilities of a natural person.
Definition of Company
In the legal sense, a company is an association of both natural and artificial persons (and is incorporated under the existing law of a country). In terms of the Companies Act, 2013 (Act No. 18 of 2013) a “company” means a company incorporated under this Act or under any previous company law *Section 2(20).