What is the Difference between NCLT and NCLAT

  • February 11, 2019
  • Registrationwala
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During the introduction of Insolvency and Bankruptcy Code, one adjudicating authority that got the most highlight was the National Company Law Tribunal or NCLT. Some might even say that this authority might be the entire crux of the insolvency resolution process. However, being the focal point does not imply that its decisions cannot be challenged, and this is where NCLAT steps in.

NCLAT refers to National Company Law Appellate Tribunal. Let us understand the difference between the two in a more succinct manner.

NCLT: the definition

NCLT or National Company Law tribunal is the adjudicating authority to whom the petition of insolvency resolution is forwarded to. It is this adjudicating authority that passes the order for insolvency resolution. Its functions are:

  1. Determining facts and deciding cases according to the principle of natural justice
  2. It is not bound by strict judicial regulations related to procedures and evidence.
  3. It passes the order on whether the company is to be liquidated or resolved.

It has a particularly discernible set of powers through which it exercises the above three points. However, despite all of that it can make some mistake or do something that the insolvent entities or the creditors don’t agree to. In such a case, the matter is taken to even higher authority.

NCLAT: The definition

NCLAT or National Company Law Appellate tribunal is an authority that stands a step higher than the NCLT. It is the authority that handles the appeals that are borne out of the dissatisfaction from the decisions made by the National Company law tribunal. This particular authority is formed to:

  1. Correct the errors that the NCLT made
  2. Act as an intermediate Appellate forum where aggrieved insolvent entities can be heard.
  3. Be an intermediate authority that lies just between NCLT and the Supreme Court.

The difference between NCLT and NCLAT

As evident from the previous two sections, the difference between National Company Law Tribunal and the National Company Law Appellate Tribunal can be surmised into the following points:

  1. NCLT holds the primary jurisdictions on the matters of insolvency and bankruptcy while NCLAT holds the appellate jurisdictions over the decisions made by NCLT
  2. NCLT accepts and analyses the evidence taken from the Creditors and/or lenders. NCLAT reviews and analyses the decisions that are made by NCLT.
  3. Collecting the facts and evidence is the responsibility of the NCLT. Analyzing the facts and evidence that are already collected is the responsibility of NCLAT.

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