The National Company Law Tribunal (NCLT) and its appellate body, the NCLAT, decide most corporate disputes in India, from shareholder fights to insolvency. There is a bench at Kolkata. Knowing when to approach the tribunal, and when not to, can save a business.

Company law matters before the NCLT

• Oppression and mismanagement (Sections 241 and 242 of the Companies Act, 2013) by qualifying minority shareholders.
• Mergers, demergers and compromise schemes (Sections 230 to 232).
• Winding up and rectification of registers.

In Tata Sons v. Cyrus Investments (2021), the Supreme Court set aside the NCLAT order reinstating Cyrus Mistry as Executive Chairman, a case which shows the limits on tribunal intervention in internal governance.

Insolvency under the IBC, 2016

• Who can apply: financial creditors (Section 7), operational creditors (Section 9, after a demand notice under Section 8) and the corporate debtor itself (Section 10), with a minimum default of one crore rupees.
• Moratorium: Section 14 stops recovery actions against the debtor during the process.
• Timeline: the resolution process is meant to finish within 180 days, extendable to a maximum of 330 days including litigation.
• Resolution plan: approved by the Committee of Creditors by the prescribed majority, then by the NCLT. Under Section 29A, certain defaulting promoters cannot bid.
• In Mobilox Innovations v. Kirusa Software (2017), the Supreme Court held that a pre-existing dispute defeats an operational creditor's petition. In Swiss Ribbons v. Union of India (2019), the Court upheld the IBC's validity, and in the Essar Steel matter (2019), it stressed creditors' commercial wisdom.

Liquidation

If no plan is approved, the NCLT orders liquidation under Section 33. Assets are distributed under the Section 53 waterfall, where secured creditors and workmen's dues rank ahead of unsecured creditors and shareholders.

Appeals

An appeal against an NCLT order lies to the NCLAT, generally within thirty days with a further fifteen days if sufficient cause is shown, and then to the Supreme Court.

Pros and cons

• Pros: a time-bound, collective process; a moratorium; leverage for creditors; possibility of rescuing a viable business; specialised judges.
• Cons: delays beyond the statutory time limits; heavy haircuts for creditors; loss of control and reputational damage for promoters; costs of professionals; use as a pressure tactic that tribunals now scrutinise.

Before filing or responding to a petition, evaluate settlement, the strength of any pre-existing dispute, and the long-term goal: recovery, control or exit.

Need Guidance? Contact KC LEGAL

For more information or to discuss your matter with our advocates, call or WhatsApp +91 98311 90819, write to info@kclegal.us, or use our contact form. Our office is at Olisa House, 10th Floor, 4 Government Place, Kolkata 700001.

This article is for general information only and is not legal advice. Law and procedure change; please verify the current position for your specific case. Last reviewed: November 2026.