1. The Tribunal and the Appellate Tribunal shall not, while disposing of any proceeding before it or, as the case may be, an appeal before it, be bound by the procedure laid down in the Code of Civil Procedure, 1908, but shall be guided by the principles of natural justice, and, subject to the other provisions of this Act and of any rules made there under, the Tribunal and the Appellate Tribunal shall have power to regulate their own procedure.
2. The Tribunal and the Appellate Tribunal shall have, for the purposes of discharging their functions under this Act, the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 while trying a suit in respect of the following matters, namely:—
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. subject to the provisions of sections 123 and 124 of the Indian Evidence Act, 1872, requisitioning any public record or document or a copy of such record or document from any office;
e. issuing commissions for the examination of witnesses or documents;
f. dismissing a representation for default or deciding it ex parte;
g. setting aside any order of dismissal of any representation for default or any order passed by it ex parte; and
h. any other matter which may be prescribed.
3. Any order made by 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, and it shall be lawful for the Tribunal or the Appellate Tribunal to send for execution of its orders to the court within the local limits of whose jurisdiction,
a. in the case of an order against a company, the registered office of the company is situate; or
b. in the case of an order against any other person, the person concerned voluntarily resides or carries on business or personally works for gain.
4. All proceedings before the Tribunal or the Appellate Tribunal shall be 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, and the Tribunal and the Appellate Tribunal shall be deemed to be civil court for the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973.
Legal Commentary & Landmark Judgments: Section 424
Section 424 establishes that the NCLT and NCLAT are not bound by the strict Code of Civil Procedure (CPC), but are guided by principles of natural justice, while enjoying inherent civil court powers to summon witnesses and enforce decrees.
This statutory framework establishes clear operational guidelines, balancing legal compliance with procedural safeguards.
Section 424 liberates company tribunals from the procedural technicalities of the CPC while maintaining the non-negotiable standard of natural justice (audi alteram partem). Crucially, under Section 424(3), NCLT orders are directly executable as civil court decrees; the Tribunal can transmit its orders to local civil courts for property attachment or initiate execution proceedings directly.