The National Company Law Tribunal (NCLT) Ahmedabad Bench has recently affirmed its authority to punish for civil contempt under Section 425 of the Companies Act, 2013, read with Section 12 of the Contempt of Courts Act, 1971. This development underscores the tribunal's commitment to enforcing its orders and maintaining the sanctity of judicial directives.

Legal Framework: Sections 425 and 12

Section 425 of the Companies Act, 2013, endows the NCLT with the same jurisdiction, powers, and authority in contempt matters as those exercised by High Courts under the Contempt of Courts Act, 1971. Specifically, Section 12 of the Contempt of Courts Act empowers courts to punish individuals for contempt, which includes willful disobedience of court orders. This legislative framework ensures that the NCLT can effectively address instances where its orders are deliberately ignored or violated.

Case Analysis: NCLT Ahmedabad's Stance

In a notable case before the NCLT Ahmedabad Bench, the tribunal addressed the issue of contempt arising from the disobedience of its orders. The contemnor, a director of the respondent company, had alienated the company's immovable property in direct contravention of the tribunal's directives and without notifying the applicant. The tribunal observed that such non-compliance constituted civil contempt, characterized by willful, deliberate, and intentional disobedience of judicial orders. Emphasizing its authority under Section 425 of the Companies Act, the tribunal sentenced the contemnor to six months of simple imprisonment and imposed a fine of ?2,000. This decision highlights the tribunal's resolve to uphold the rule of law and ensure compliance with its directives. 

Contrasting Perspectives: Jurisdictional Limitations

While the NCLT possesses contempt powers under the Companies Act, its jurisdiction does not extend to orders issued by the erstwhile Company Law Board (CLB). In a case before the National Company Law Appellate Tribunal (NCLAT), the appellate tribunal set aside an NCLT order that had allowed a contempt application concerning a CLB directive. The NCLAT clarified that the CLB did not have the jurisdiction to punish for contempt under the Companies Act, and therefore, contempt proceedings could not be initiated for non-compliance with CLB orders. 

Recent Case Laws

The following table summarizes recent case laws related to the NCLT's contempt jurisdiction:

Conclusion

The affirmation of the NCLT's contempt powers under Section 425 of the Companies Act, 2013, reinforces the tribunal's role in ensuring compliance with its orders. By exercising this authority, the NCLT upholds the integrity of its judicial processes and deters willful disobedience. However, jurisdictional boundaries, such as those concerning the erstwhile CLB, must be recognized to ensure that contempt proceedings are initiated appropriately and within the scope of the tribunal's authority.