Sections 428, 429 and 430 of the Companies Act 2013
Sections 428 to 430 form part of the statutory framework governing the National Company Law Tribunal and the National Company Law Appellate Tribunal. They deal respectively with protection for action taken in good faith, assistance in securing custody or control of property and records, and exclusion of civil-court jurisdiction over matters entrusted by law to the Tribunal or Appellate Tribunal.
- Section 428: protects specified Tribunal-related persons from legal proceedings for loss or damage arising from acts done or intended in good faith under the Companies Act 2013.
- Section 429: enables the Tribunal, in the proceedings covered by the section, to request assistance from the Chief Metropolitan Magistrate, Chief Judicial Magistrate or District Collector to obtain possession of property, books of account or other documents.
- Section 430: bars civil courts from entertaining matters that the Tribunal or Appellate Tribunal is empowered to determine and restricts injunctions against action taken or proposed under the relevant statutory powers.
The Companies Act 2013 is Central Act No. 18 of 2013. For authoritative statutory text and amendments, readers should verify the current legislation through official Government sources.
Section 428 - Protection of action taken in good faith
Meaning: Section 428 provides a statutory protection where an act is done, or intended to be done, in good faith in pursuance of the Companies Act 2013. The protection applies to the Tribunal and Appellate Tribunal and to the specified office-holders, employees, liquidators and other persons authorised for discharge of functions under the Act.
Statutory provision
No suit, prosecution or other legal proceeding shall lie against the Tribunal, the President, Member, officer or other employee, or against the Appellate Tribunal, the Chairperson, Member, officer or other employees thereof or liquidator or any other person authorised by the Tribunal or the Appellate Tribunal for the discharge of any function under this Act in respect of any loss or damage caused or likely to be caused by any act which is in good faith done or intended to be done in pursuance of this Act.
Practical scope
The section is directed to protection for acts connected with statutory functions and expressly makes good faith a condition of the protection. It should therefore be read in the context of the particular power or duty being exercised under the Act rather than as a general immunity unrelated to statutory functions.
Section 429 - Power to seek assistance of Chief Metropolitan Magistrate, etc.
Meaning: Section 429 provides an enforcement mechanism enabling the Tribunal to obtain assistance for taking custody or control of property, books of account and other documents in proceedings falling within the section.
Sub-section (1)
The Tribunal may, in proceedings for winding up of a company under the Companies Act 2013 or in proceedings under the Insolvency and Bankruptcy Code 2016, where it is necessary to take into custody or control property, books of account or other documents, make a written request to the Chief Metropolitan Magistrate, Chief Judicial Magistrate or District Collector within whose jurisdiction the relevant property or records are situated or found.
On such request, the authority is required to take possession of the property, books of account or other documents and cause them to be entrusted to the Tribunal or a person authorised by it.
Sub-section (2) - Steps and force necessary for compliance
For securing compliance with sub-section (1), the Chief Metropolitan Magistrate, Chief Judicial Magistrate or District Collector may take, or cause to be taken, the steps and use, or cause to be used, the force considered necessary for that purpose.
Sub-section (3) - Protection of acts under the section
The section further provides that an act of the Chief Metropolitan Magistrate, Chief Judicial Magistrate or District Collector done in pursuance of Section 429 shall not be called in question in any court or before any authority on any ground whatsoever.
Legislative note: Section 429 was substituted by the Insolvency and Bankruptcy Code 2016 through Section 255 and the Eleventh Schedule, with effect from 15 November 2016. The substituted provision expressly extends to proceedings under the Insolvency and Bankruptcy Code 2016.
Section 430 - Civil court not to have jurisdiction
Meaning: Section 430 creates a statutory bar on civil-court jurisdiction for matters that the Tribunal or Appellate Tribunal is empowered to determine under the Companies Act 2013 or any other law for the time being in force.
Statutory provision
No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under the Companies Act 2013 or any other law for the time being in force. The section also states that no injunction shall be granted by any court or other authority in respect of action taken or proposed to be taken in pursuance of powers conferred by or under the Act or any other law for the time being in force by the Tribunal or Appellate Tribunal.
Effect of the jurisdictional bar
The operative question under Section 430 is whether the matter is one that the Tribunal or Appellate Tribunal is empowered by the governing legislation to determine. The provision therefore links the exclusion of civil jurisdiction to the statutory jurisdiction conferred on those specialised forums.
How Sections 428, 429 and 430 work together
These provisions address different parts of the Tribunal framework. Section 428 protects good-faith statutory action by specified persons. Section 429 supplies machinery for obtaining physical custody or control of relevant property and records in the proceedings covered by that provision. Section 430 preserves the specialised adjudicatory field assigned by legislation to the Tribunal and Appellate Tribunal by restricting parallel civil-court proceedings and injunctions in matters within their statutory power.
Important related provisions
For a fuller understanding of the Tribunal and Appellate Tribunal framework, Sections 421 to 427 deal with appeals, procedure, contempt, delegation and public-servant status, while Sections 431 onward address matters including vacancies, legal representation, limitation and transfer of proceedings.
This article is a general statutory reference. Always check the current Act, amendments, notifications and applicable judicial decisions for a particular proceeding.