Section 424 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 424 sets the ground rules for how the NCLT and the NCLAT work. They are not bound by the Code of Civil Procedure, 1908, they follow natural justice, they have power to regulate their own procedure, they hold certain civil-court powers, and their orders can be enforced like a decree.
The Tribunal and Appellate Tribunal are not bound by the Code of Civil Procedure, 1908, but are guided by the principles of natural justice and may regulate their own procedure, subject to the Act, the Insolvency and Bankruptcy Code, 2016 and the rules. They have the powers of a civil court on listed matters such as summoning witnesses and receiving evidence on affidavits. An order may be enforced as if it were a decree, including by sending it to the court where the company's registered office is. Their proceedings are deemed judicial proceedings.
Section 424 at a glance
| Sub-section | What it covers |
|---|---|
| (1) | Not bound by the Code of Civil Procedure; guided by natural justice; power to regulate own procedure |
| (2) | Same powers as a civil court on listed matters (a) to (h) |
| (3) | Orders enforced as a decree; may be sent for execution to a court |
| (4) | Proceedings deemed judicial proceedings; Tribunal deemed a civil court for certain purposes |
The words "or of the Insolvency and Bankruptcy Code, 2016" in sub-sections (1) and (2) were inserted by the Insolvency and Bankruptcy Code, 2016 itself, with effect from 15 November 2016, as the footnotes in the official text show.
Section 424(1): natural justice, not the CPC
The Tribunal and Appellate Tribunal "shall not ... be bound by the procedure laid down in the Code of Civil Procedure, 1908". They are instead "guided by the principles of natural justice". The text says they shall have power to regulate their own procedure, but only subject to the other provisions of the Act or the Insolvency and Bankruptcy Code, 2016 and any rules made under the Act.
In practice this means the procedure is found in the rules made under the Act, including the NCLT Rules, 2016, and in the Tribunal's own orders. Natural justice means at least a fair chance to present your case and a reasoned decision.
For a practical walk-through, see appearing before the NCLT: procedure, requirements and practice tips. If you need help with filings and hearings, our legal dispute resolution team can assist.
Section 424(2): civil-court powers
For the purposes of discharging their functions under the Act or the Code, the Tribunal and the Appellate Tribunal have the same powers as a civil court under the Code of Civil Procedure, 1908 while trying a suit in respect of these matters.
| Clause | Power |
|---|---|
| (a) | Summoning and enforcing the attendance of any person and examining him on oath |
| (b) | Requiring the discovery and production of documents |
| (c) | Receiving evidence on affidavits |
| (d) | Requisitioning any public record or document or a copy of it from any office, subject to sections 123 and 124 of the Indian Evidence Act, 1872 |
| (e) | Issuing commissions for the examination of witnesses or documents |
| (f) | Dismissing a representation for default or deciding it ex parte |
| (g) | Setting aside an order of dismissal for default, or an ex parte order |
| (h) | Any other matter which may be prescribed |
Example. A petitioner alleges that the company's books show diversions. The Tribunal can direct production of the books (clause (b)) and accept affidavit evidence (clause (c)). If the respondent does not appear after notice, it can decide ex parte (clause (f)), and the respondent can later ask to set that order aside (clause (g)).
Section 424(3): enforcing the order
An order of the Tribunal or the Appellate Tribunal "may be enforced by that Tribunal in the same manner as if it were a decree made by a court in a suit pending therein". It is also lawful for the Tribunal to send the order for execution to a court:
- Against a company: the court within whose local limits the registered office of the company is situated.
- Against any other person: the court within whose local limits the person voluntarily resides, carries on business or personally works for gain.
So a successful applicant is not left with a paper order. The Tribunal can enforce it directly or send it to the right court for execution. If the order is not complied with, contempt is also available under section 425, covered in sections 425 to 431.
Section 424(4): judicial proceedings
All proceedings before the Tribunal or the Appellate Tribunal are deemed to be judicial proceedings within the meaning of sections 193 and 228, and for the purposes of section 196, of the Indian Penal Code. The Tribunals are also deemed to be a civil court for the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973.
Note on the old codes. The section cites the Indian Penal Code, the Code of Criminal Procedure, 1973 and the Indian Evidence Act, 1872 (in clause (d) of sub-section (2)). From 1 July 2024 these were replaced by the Bharatiya Nyaya Sanhita, 2023, the Bharatiya Nagarik Suraksha Sanhita, 2023 and the Bharatiya Sakshya Adhiniyam, 2023. The references are now read as references to the new laws. Check the equivalent provisions before citing them.
The effect of sub-section (4) is that false evidence or a forged document put before the Tribunal is treated as a matter before a judicial proceeding, which makes the criminal consequences real. See sections 448 and 449: false statement and false evidence.
How this fits with other sections
- Appeal: procedure before the Appellate Tribunal is the same as stated here. See section 421.
- Legal representation: who may appear is in section 432, in sections 432 and 433.
- Bar on civil courts: section 430 excludes civil courts from matters within the Tribunal's jurisdiction.
Proposed change (Corporate Laws (Amendment) Bill, 2026)
We found no clause in the Corporate Laws (Amendment) Bill, 2026 that amends section 424. The Bill was introduced in Lok Sabha on 23 March 2026 and sent to a Joint Parliamentary Committee, whose report came on 3 August 2026. It is pending and not law as on 30 September 2026.
Need help with procedure before the NCLT?
The Tribunal's procedure is flexible, but its rules and directions are strict in practice. Our legal dispute resolution team can help you prepare pleadings, affidavits and documents, and track compliance with the order.
Key takeaways
- Not bound by the CPC, but guided by natural justice.
- Power to regulate its own procedure, subject to the Act, the IBC and the rules.
- Civil-court powers on summoning, documents, affidavits, commissions, default and ex parte orders.
- Orders enforceable as a decree; execution can go to the court at the registered office.
- Proceedings are judicial proceedings.
- Old criminal-code references are read as references to the new Sanhitas.
Read next
- Expeditious disposal and appeal to the Supreme Court: sections 422 and 423
- Contempt, civil court bar and good faith: sections 425 to 431
- NCLT jurisdiction, powers and procedure under company law
- How to file an application before the NCLT
Disclaimer: Based on the Companies Act, 2013 as amended up to 1 April 2021 (official consolidated text), read with later developments noted in the article; proposals in the Corporate Laws (Amendment) Bill, 2026 are pending and not law as on 30 September 2026. Verify current notifications and rules before acting.