Companies (Amendment) Bill 2016 NCLT Related Provisions

     

Companies (Amendment) Bill 2016 NCLT Related Provisions

The Companies Law Committee in its report dated 01/02/2016 noted that after the honorable Supreme Court’s Order of May, 2015, the government had initiated the process of constituting the ‘National Company Law Tribunal’. The Committee felt that changes in the Companies Act, 2013, in section 409(3)(a) & (e), 411(3) and 412(2), as directed by the honorable Supreme Court, should be included in the Act. Accordingly the Companies (Amendment) Bill 2016 proposes amendments in section 409, section 411 and section 412 of Companies Act, 2013 with respect to the following ;-  

a.      Qualification of Technical Members of NCLT.

b.    Constitution of selection committee with respect selection of members of tribunal and appellate tribunal.

Amendments Proposed in Section 409 (Clause 78)

(i)      In Section 409 of the principal Act, in Sub section (3),-(i) in clause (a), for the words "out of which at lease three years shall be in the pay scale of Joint Secretary to the Government of India or equivalent or above in the that service", the words "and has been holding the rank of secretary or additional secretary to the Government of India" shall be substituted ;

(ii)     For Cluase (e) the following clause shall be substituted namely :- “(e) is a person of proven ability, integrity and standing having special knowledge and professional experience of not less than fifteen years in industrial finance, industrial management, industrial reconstruction, investment and accountancy.”

Amendments Proposed in Section 411 (Clause 79)

In section 411 of the principal Act, for sub section (3), the following sub section shall be substituted, namely :-

“(3) A technical member shall be a person of proven ability, integrity and standing having special knowledge and professional experience of not less than twenty five years in industrial finance, industrial management, industrial reconstruction, investment and accountancy”.

Amendments Proposed in Section 412 (Clause 80)

In section 412 of the principal Act, for sub section (2), the following sub section shall be substituted, namely :-

“(2) The members of the Tribunal and the technical members of the Appellate Tribunal shall be appointed on the recommendation of a Selection Committee consisting of –

(a)  Chief Justice of India or his nominee – Chairpeson;

(b)  A senior judge of the supreme court or Chief Justice of High Court – Member;

(c)  Secretary in the ministry  of Corporate Affairs – Member; and

(d)  Secretary in the ministry of Law and Justice – Member.

(2A) Where in a meeting of the selection committee, there is equality of votes on any matter, the chairperson shall have a casting vote.”  

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