MCA says its role in NCLT appointments is only administrative after Supreme Court remarks

The NCLT independently handles the appointment and management of its officers and staff, including deputy registrars, court officers, stenographers, office assistants and multi-tasking staff, the ministry said in a statement.

New Delhi: The ministry of corporate affairs (MCA) on Friday said it only has an administrative role in the appointment of the 63 judicial and technical members of the National Company Law Tribunal (NCLT), clarifying its position amid scrutiny of its role in the hiring process at the corporate tribunal.

The NCLT independently handles the appointment and management of its officers and staff, including deputy registrars, court officers, stenographers, office assistants and multi-tasking staff, the ministry said in a statement. The government delegated these responsibilities to the tribunal through an October 2019 notification to ensure its effective and independent functioning.

The clarification came a day after a Supreme Court bench headed by the Chief Justice of India reportedly remarked that the MCA had “hijacked” the NCLT and called for greater autonomy for the presidents of the NCLT and the National Company Law Appellate Tribunal (NCLAT) in personnel matters.

“In the light of certain news reports concerning personnel matters relating to the NCLT made by the honourable Supreme Court, the respective roles of the MCA and the NCLT may be seen in the context of the distinct responsibilities assigned to them,” the ministry said.

The statement, however, did not explain the appointment process followed for the NCLAT.

According to news agency PTI, the Supreme Court's observations came while hearing a petition filed by contractual employees working in the NCLT and NCLAT.

Tribunal strength

The NCLT has a sanctioned strength of 63 members, comprising one president, 31 judicial members and 31 technical members.

Constituted under the Companies Act, 2013, the NCLT was formally established on 1 June 2016. Its creation followed the recommendations of the Justice Eradi Committee, which called for a unified forum to adjudicate matters relating to company law and insolvency, replacing multiple adjudicating bodies, according to the tribunal's website.

The NCLT was set up to streamline corporate dispute resolution by consolidating the functions of the erstwhile Company Law Board, the Board for Industrial and Financial Reconstruction and the Appellate Authority for Industrial and Financial Reconstruction.

The NCLAT, which also became operational on 1 June 2016, hears appeals against NCLT orders.