Section 267 of the Companies Act, 2013
Section 267 of the Companies Act, 2013 deals with the Compromise, Arrangement, and Reconstruction of companies, particularly the powers of the National Company Law Tribunal (NCLT) to approve such schemes.
🔹 Section 267 – Powers of the Tribunal to Enforce Compromise or Arrangement
✅ Key Provisions:
📌 1. Power of the Tribunal:
The National Company Law Tribunal (NCLT) has the power to approve a compromise or arrangement between a company and its creditors or members.
Once approved by the Tribunal, the compromise or arrangement becomes binding on:
The company,
All the creditors,
And members (including those who may have opposed the scheme).
📌 2. Enforcement:
The Tribunal can make such orders as it deems fit to give effect to the compromise or arrangement.
It can also impose conditions or modifications necessary for the just and equitable implementation of the scheme.
📌 3. Effect of the Order:
The order by the Tribunal is conclusive evidence of the approval.
It bars any further proceedings by creditors or members against the company with respect to the matters covered under the compromise or arrangement.
📝 Context:
Section 267 is read along with Sections 230 to 266, which detail the process for compromise or arrangement including mergers, demergers, and reconstructions.
The scheme is typically proposed by the company and must be approved by a majority of creditors/members and sanctioned by the NCLT.
🧾 Summary:
Section 267 empowers the Tribunal to give final approval to a scheme of compromise or arrangement, making it binding and enforceable.
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