An Analytical Study on NCLT’s Power and Restrictions under the Insolvency and Bankruptcy Code.

Abstract

The current insolvency system in India can be traced back to the period of colonial authority. The framework has experienced several revisions over the past two centuries, resulting in a multitude of overlapping and contradictory decisions made by the adjudicating bodies. There were many attempts made in the past to reorganise the sick industries, and make the process time-efficient through reconciliation of various Acts such as the Companies Act, 2013, RDDBFI Act, and SARFAESI Act. However, these efforts fell short of expectations, prompting the legislature to introduce the IBC Code. One of the primary objectives of the Code is to ensure a time-bound resolution process. To achieve this, quasi-judicial bodies like the NCLT have been vested with extensive jurisdictional powers over all aspects of the CIRP and corporate debtors. The paper is structured into two parts. The first part focuses on significant amendments regarding the powers of courts and tribunals in resolving insolvency disputes throughout India’s legal history, leading to the current bankruptcy framework. The second part examines how the objectives of the Insolvency and Bankruptcy Code have been achieved by empowering quasi-judicial authorities to determine the future of insolvent companies.