What is the function of the National Company Law Tribunal (NCLT)?

The National Company Law Tribunal (NCLT) plays a crucial role in addressing corporate insolvency cases. This specialized tribunal is established under the Companies Act, 2013, to adjudicate disputes related to company law and to exercise jurisdiction over matters concerning insolvency and bankruptcy.

One of its primary functions is to hear and resolve applications under the Insolvency and Bankruptcy Code, facilitating the process of corporate restructuring and handling liquidations. The NCLT's decisions are critical in protecting the interests of various stakeholders, including creditors, members, and employees of the company during insolvency proceedings. By focusing on corporate insolvency, the NCLT helps ensure that companies can either successfully rehabilitate or dissolve in an orderly manner, promoting economic stability and efficiency in the marketplace.

Other choices, while related to financial regulations, do not accurately describe the core functions of the NCLT. The handling of debt recovery is typically under the jurisdiction of civil courts and other financial regulatory authorities rather than the NCLT. Regulation of payment systems is typically managed by monetary authorities, while the insurance of deposits for banks falls under the purview of specific banking regulations and organizations tasked with deposit insurance. Thus, the focus of the NCLT on corporate insolvency distinctly outlines