Latest news with #NCLAT
Time of India
5 days ago
- Business
- Time of India
NCLT has powers to direct probe into company's affairs in insolvency matters, says NCLAT
Appellate tribunal NCLAT has clarified that the National Company Law Tribunal ( NCLT ) can order an investigation into the affairs of a company by probe agencies in cases related to the Insolvency & Bankruptcy Code by exercising its power under the Companies Act. The NCLAT order came on May 15 over a plea filed by Max Publicity & Communication which had challenged an NCLT order. The Mumbai bench of NCLT, on January 21, 2025, while rejecting an insolvency plea against Max Publicity & Communication, issued a direction to forward a copy of the order to investigative agencies, including the Serious Fraud Investigation Office (SFIO) and Economic Offences Wing (EOW). by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Unlock full 2025 solar power in Algeria — install, maintain, upgrade Solar Panels | Search Ads Learn More Undo This was challenged before NCLAT by Max Publicity submitting that no opportunity was given to it to have its say on various adverse observations made against it in the impugned order, which was violation of principle of natural justice. The insolvency plea was filed in NCLT by Max Publicity & Communication's operational creditor claiming debt and default. Live Events The NCLAT (National Company Law Appellate Tribunal) in its latest order, however, said that such orders passed by NCLT under section 213 of the Companies Act, for investigations, can be passed only after complying with preconditions. "The Adjudicating Authority, while exercising jurisdiction under Section 9 of the IBC , also exercise jurisdiction of NCLT under the Companies Act, 2013," said the three-member NCLAT bench, which also comprised Chairperson Justice Ashok Bhushan. Under the IBC (Insolvency & Bankruptcy Code), NCLT is termed as the Adjudicating Authority for resolution and liquidation proceedings. "Adjudicating Authority (NCLT) in exercise of powers under Section 213 of the Companies Act, 2013 can direct for investigation, but the said investigation can be directed after complying with the precondition, i.e. affording a reasonable opportunity to the parties concerned," said NCLAT while modifying the NCLT's order. The appellate tribunal further said that NCLT can also exercise its jurisdiction under Rule 11 of the National Company Law Tribunal Rules, 2016, where it is of the view that a copy of the order needs to be forwarded to the relevant statutory authorities for investigations. "The direction under Section 212 to carry out any investigation of the company's affairs by SFIO can be made only in accordance with the statutory provisions of Section 212 and the Adjudicating Authority, while exercising jurisdiction under the Companies Act 2013, cannot issue any direction to SFIO for carrying out investigation," the NCLAT said. Section 212 of the Companies Act says the central government can direct the SFIO for an investigation into the affairs of a company either on receipt of a report of the registrar or inspector, or on intimation of a special resolution passed by a company that its affairs are required to be investigated. It can also be directed in the public interest or on request from any department of the central government or a state government. Section 213 of the Companies Act, 2013, empowers the NCLT to investigate the affairs of a company if there are grounds to suspect fraud, mismanagement, or oppressive acts. The NCLAT modified the January 21 order of NCLT, saying, "Observations and directions made in paragraphs 65 and 66 are not to be treated any direction for carrying out any investigation by the statutory authorities referred to therein." "There was no occasion to make any observation or referring the matter to EoW or SFIO to investigate and reference of EoW and SFIO in paragraph 65 stands deleted. The direction in paragraph 66 to forward the copy of the order to statutory authorities for taking appropriate steps under the Companies Act, 2013 are upheld," it added.
Time of India
11-06-2025
- Business
- Time of India
NCLAT declines to stay CCI order against UFO Moviez, Qube Cinema
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel The appellate tribunal NCLAT has refused to stay a CCI order, which imposed penalties on UFO Moviez India and Qube Cinema Technologies for indulging in anti-competitive practices A three-member bench said the "balance of convenience" and "prima facie" case lies in favour of the Competition Commission of India (CCI), given concurrent findings in the DG Investigation report."Hence in the circumstances, we are of the considered opinion that the facts do not warrant the grant of stay of the impugned order," said the National Company Law Appellate Tribunal (NCLAT).Earlier on April 16, CCI had imposed a penalty of Rs 1.04 crore on UFO Moviez India and its subsidiary Scrabble Digital and Rs 1.66 crore on Qube Cinema Technologies for indulging in anti-competitive matter pertains to the tussle between theatre owners and companies like UFO Moviez and Qube, which supply digital cinema equipment for was challenged by them before the NCLAT, which is an appellate tribunal for the orders passed by the CCI. The NCLAT directed them to deposit 25 per cent of the penalty amount imposed by CCI within two weeks."We have already passed an order of deposit of 25 per cent of the penalty amount vide a separate order. Be deposited within two weeks," the NCLAT said, adding that "the application for grant of interim stay is though dismissed but we grant four weeks time to file replies by the respondents and two weeks thereafter to file rejoinders".Both petitions are scheduled for a hearing before the appellate tribunal on August in its order, said UFO Moviez and Qube imposed restrictions on the supply of content in their lease agreements with theatre owners, which created barriers for players engaged in the post-production processing addition, these companies blocked cinema theatre owners (CTOs) with digital cinema initiatives-compliant digital cinema equipment from being served by any other companies have a market share of 34 per cent and 47 per cent, respectively, in DCI-Compliant DCEs (Digital Cinema Equipment) on lease to Cinema Theatre Owners (CTOs) in to the advent of technology, the distribution of a cinematograph film to various CTOs has transitioned to digital distribution from distribution through cinematograph film digitally distributed cinematograph film can be played by CTOs only through a DCE, and only a digitised version is NCLAT also examined the lease, terms of the agreements and the report of Dthe G of CCI."We find both the DG's report and the impugned order (of CCI) are in line with each other holding inter alia the restrictions imposed relating to content are applicable on the processes subsequent to the mastering process and though as per the agreement, contents of any third party can be run on DCE, but only subject to the payment of Rs 20,000 by the CTOs and also in case where the appellants are unable to provide content," the tribunal clause does not give any choice to the CTOs to procure content from a third KDM (Key Delivery Message) generated by other PPP (post-production processing) service providers could not be played on the DCE supplied by the appellant on lease, owing to the imposition of restriction on the server; and such practices do not appear to occur internationally and that other competitors, the NCLAT observed."Lastly, the clauses of the agreement(s) make the CTOs refuse to deal with other film producers of a cinematograph film who have not got his cinematograph film's PPP services done by OP2 (Scrabble Digital), hence violative of Section 3(4)(d) of the Act," the NCLAT said.
Hans India
08-06-2025
- Business
- Hans India
NCLAT dismisses Byju's RP plea over status quo on Aakash shareholding
The National Company Law Appellate Tribunal (NCLAT) has dismissed a plea filed by the Resolution Professional (RP) of the Think and Learn Private Limited (TLPL), the parent company of edtech firm Byju's, against an earlier order by the National Company Law Tribunal (NCLT). The NCLT had directed that the shareholding in Aakash Educational Services should remain unchanged until further hearings. A two-member bench of the NCLAT, comprising Justice Sharad Kumar Sharma and Jatindranath Swain, observed that the NCLT's direction was an interim, or interlocutory, order and appeared to be a "consensual" one. Therefore, there was no need for the appellate tribunal to intervene at this stage, it said. "Since the impugned order takes the shape of an interlocutory order, which is not deciding any of the rights of the parties, coupled with the fact that the order takes the shape of a consenting order, no interference is called for by this Tribunal in the exercise of its Appellate Jurisdiction at this stage," the NCLAT stated. The dispute arose from concerns over equity fundraising activities by Aakash Educational Services, in which TLPL holds a 25 per cent stake. On March 27, the NCLT had directed all parties to maintain the status quo regarding Aakash's shareholding until the next hearing. The TLPL, through its Resolution Professional, later challenged this direction before the Chennai bench of the NCLAT. Meanwhile, the matter also reached the Karnataka High Court, and on April 8, it set aside the NCLT's earlier order and sent the case back to the insolvency tribunal. During the next NCLT hearing on April 30, the TLPL's counsel, senior advocate Abhinav Vasisht, raised concerns that the TLPL's shareholding in Aakash was being diluted and that important assets were being hypothecated. He further claimed that changes had been made to the Articles of Association of Aakash, which had earlier protected the TLPL's interests. Given the complexity of the case and the upcoming summer break, the NCLT passed a temporary 'consent order' on April 30. The order stated that the TLPL's shareholding in Aakash should not be diluted until the tribunal could fully hear the matter. However, the TLPL again challenged this interim direction, arguing that their concerns were not being fully addressed. The NCLAT, after hearing the appeal, concluded that the NCLT's order was not final and did not warrant intervention. As a result, the appellate tribunal dismissed the TLPL's appeal.
Time of India
08-06-2025
- Business
- Time of India
NCLAT rejects Byju's resolution professional's petition in Aakash shareholding row
The National Company Law Appellate Tribunal ( NCLAT ) has dismissed a plea filed by Resolution Professional of Think & Learn, which owns edtech brand Byju's , challenging an NCLT order directing to maintain status quo regarding the company's stake in Aakash Educational Services . A two-member NCLAT bench said that since the NCLT order is "consensual" an an interlocutory order, which is not deciding any of the rights of the parties, no interference is called for by the appellate tribunal at this stage. "Since the impugned order takes the shape of an interlocutory order, which is not deciding any of the rights of the parties, coupled with the fact that the order takes the shape of a consenting order, no interference is called for by this Tribunal in the exercise of its Appellate Jurisdiction at this stage," said NCLAT. TLPL , through its RP, had moved the Chennai bench of NCLAT against the NCLT direction not to alter the shareholding, against the backdrop of plans of equity fund raising by Aakash Educational Services. On March 27, the National Company Law Tribunal (NCLT) had passed an interim order directing to maintain status quo in respect of Aakash Educational Services as on date, till next date of hearing. Live Events The order was challenged by Aakash before the High Court of Karnataka, which, after hearing both sides, on April 8, 2025 set aside the interim order granted by NCLT and remitted the matter to the insolvency tribunal. Discover the stories of your interest Blockchain 5 Stories Cyber-safety 7 Stories Fintech 9 Stories E-comm 9 Stories ML 8 Stories Edtech 6 Stories This was brought to the notice of NCLT in its next hearing on April 30, 2025, where Abhinav Vasisht, Senior Counsel for Resolution Professional, alleged that not only dilution of shareholding of TLPL in Aakash was continuing but also vital assets of the company have been hypothecated. The Articles of Association of Aakash, which protect the interest of TLPL have been materially altered, he said, while submitting that the interest of TLPL needs to be protected in all the areas of concern. However, observing that any interim relief would not be possible as it required detailed submissions and the forthcoming summer vacation, NCLT passed a consent order, directing that stake of TLPL will not be diluted in Aakash. ".... but in the given facts and circumstances particularly when the matter is yet to be fully heard we would confine to passing a consent order that the shareholding of the Petitioner (TLPL) in the Respondent No.1 Company (percentage wise) be not diluted till the prayer of the Petitioner (TLPL) for interim reliefs are heard and decided by this Tribunal on the next date to be fixed," said NCLT while passing a three-page interim order on April 30. TLPL has 25 per cent shareholding in Aakash Educational Services. This order was challenged by TLPL through its RP before the appellate tribunal NCLAT, which declined to interfere in this, saying that the order passed by NCLT seems to be a "consensual order" and interlocutory in nature. "Thus, the instant Company Appeal (AT) (CH) No. 68 / 2025 lack merits and the same is accordingly dismissed," said NCLAT bench comprising Members Justice Sharad Kumar Sharma and Jatindranath Swain.
Mint
08-06-2025
- Business
- Mint
NCLAT rejects Byjus resolution professionals petition in Aakash shareholding row
New Delhi, Jun 8 (PTI) The National Company Law Appellate Tribunal (NCLAT) has dismissed a plea filed by Resolution Professional of Think & Learn, which owns edtech brand Byju's, challenging an NCLT order directing to maintain status quo regarding the company's stake in Aakash Educational Services. A two-member NCLAT bench said that since the NCLT order is "consensual" an an interlocutory order, which is not deciding any of the rights of the parties, no interference is called for by the appellate tribunal at this stage. "Since the impugned order takes the shape of an interlocutory order, which is not deciding any of the rights of the parties, coupled with the fact that the order takes the shape of a consenting order, no interference is called for by this Tribunal in the exercise of its Appellate Jurisdiction at this stage,' said NCLAT. TLPL, through its RP, had moved the Chennai bench of NCLAT against the NCLT direction not to alter the shareholding, against the backdrop of plans of equity fund raising by Aakash Educational Services. On March 27, the National Company Law Tribunal (NCLT) had passed an interim order directing to maintain status quo in respect of Aakash Educational Services as on date, till next date of hearing. The order was challenged by Aakash before the High Court of Karnataka, which, after hearing both sides, on April 8, 2025 set aside the interim order granted by NCLT and remitted the matter to the insolvency tribunal. This was brought to the notice of NCLT in its next hearing on April 30, 2025, where Abhinav Vasisht, Senior Counsel for Resolution Professional, alleged that not only dilution of shareholding of TLPL in Aakash was continuing but also vital assets of the company have been hypothecated. The Articles of Association of Aakash, which protect the interest of TLPL have been materially altered, he said, while submitting that the interest of TLPL needs to be protected in all the areas of concern. However, observing that any interim relief would not be possible as it required detailed submissions and the forthcoming summer vacation, NCLT passed a consent order, directing that stake of TLPL will not be diluted in Aakash. ".... but in the given facts and circumstances particularly when the matter is yet to be fully heard we would confine to passing a consent order that the shareholding of the Petitioner (TLPL) in the Respondent No.1 Company (percentage wise) be not diluted till the prayer of the Petitioner (TLPL) for interim reliefs are heard and decided by this Tribunal on the next date to be fixed," said NCLT while passing a three-page interim order on April 30. TLPL has 25 per cent shareholding in Aakash Educational Services. This order was challenged by TLPL through its RP before the appellate tribunal NCLAT, which declined to interfere in this, saying that the order passed by NCLT seems to be a "consensual order" and interlocutory in nature. "Thus, the instant Company Appeal (AT) (CH) No. 68 / 2025 lack merits and the same is accordingly dismissed," said NCLAT bench comprising Members Justice Sharad Kumar Sharma and Jatindranath Swain.
