3 days ago
Parliamentary Panel Seeks Dedicated NCLT Benches for Insolvency Cases
A parliamentary panel studied how the National Company Law Tribunal is working.
It found that more than half of the tribunal’s cases now involve insolvency.
Insolvency cases deal with companies that are struggling with debt.
The panel suggested creating special benches to handle these cases.
This could help resolve them more quickly.
It also wants the tribunal to continue giving enough attention to other company-law matters.
NCLT has permission for 62 members, but fewer members were working on July 13.
The panel also said the tribunal relies too much on temporary workers.
It reported that more than 95 percent of the workforce was hired on contracts, which can make it harder to retain experience and expertise.
A parliamentary panel recommended dedicated insolvency benches or verticals within the National Company Law Tribunal.
The panel said insolvency matters now represent more than half of NCLT’s total caseload.
It warned that insolvency work should not reduce attention to mergers, corporate governance and stakeholder protection under company law.
NCLT’s sanctioned strength remains 62 members, while it had 26 Judicial Members and 25 Technical Members on July 13.
NCLT approved 78 resolution plans worth ₹5,517.66 crore during the June quarter.
- Who
- The Department-Related Parliamentary Standing Committee on Personnel, Public Grievances, Law and Justice and the National Company Law Tribunal.
- What
- The panel recommended examining dedicated Insolvency and Bankruptcy Code benches or verticals, along with additional members, infrastructure and permanent staff.
- Where
- The recommendation concerns NCLT and its benches, including those in New Delhi, Allahabad, Ahmedabad, Bengaluru, Chandigarh, Chennai, Cuttack, Hyderabad, Indore, Kolkata, Kochi and Mumbai.
- When
- The report was tabled in Parliament earlier in August; NCLT staffing figures cited were as of July 13, and the resolution-plan figures covered the June quarter.
- Why
- Insolvency matters make up more than half of NCLT’s caseload and are placing pressure on its judicial and administrative capacity.
Key facts
- Recommendation
- The panel asked the corporate affairs ministry to examine dedicated IBC benches or verticals with judicial and technical members, registry support and infrastructure.
- NCLT sanctioned strength
- One President, 31 Judicial Members and 31 Technical Members, totaling 62 positions.
- NCLT working strength
- As of July 13, the tribunal had one President, 26 Judicial Members and 25 Technical Members.
- Caseload
- Insolvency matters accounted for more than half of the tribunal’s total caseload.
- Workforce
- More than 95 percent of the tribunal’s workforce was engaged on a contractual basis.
- Resolution plans
- NCLT approved 78 resolution plans involving ₹5,517.66 crore during the June quarter.
- Staffing proposal
- The panel called for adequate permanent posts and periodic reviews of additional benches and members.
Quotes
Department-Related Parliamentary Standing Committee on Personnel, Public Grievances, Law and Justice
Parliamentary committee reviewing the functioning of tribunals in India
“According to the Tribunal, the existing judicial strength is no longer commensurate with the volume and complexity of matters being adjudicated and additional benches and members are required to effectively discharge its expanded mandate.”
thehansindia.com
“Such a specialised mechanism would facilitate expeditious disposal of insolvency matters while ensuring that the tribunal's company law jurisdiction receives equal attention.”
thehansindia.com
livemint.com
Sources
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