Section 298 of the Companies Act, 2013
🔹 Section 298 of the Companies Act, 2013
Title: Power of the Tribunal to Restrain Company from Exercising Certain Powers
✅ Overview:
Section 298 empowers the National Company Law Tribunal (NCLT) to restrain a company from exercising any of its powers conferred by the Companies Act or its Articles of Association if it is just and equitable to do so.
🔍 Key Provisions:
The Tribunal may, on the application of a member or any other person concerned, make an order restraining a company from exercising any power under the Companies Act or its Articles if:
The exercise of that power would be oppressive, unfair, or prejudicial to the interests of the members or public,
Or it is otherwise just and equitable to issue such a restraint.
Such restraint may be temporary or until the Tribunal directs otherwise.
📝 Summary:
| Aspect | Details |
|---|---|
| Authority | National Company Law Tribunal (NCLT) |
| Powers to restrain | Any power under Companies Act or Articles of Association |
| Grounds for restraint | Just and equitable reasons |
| Who can apply | Members or other concerned persons |
📌 Purpose:
To provide a legal remedy to prevent misuse of company powers that could harm shareholders, stakeholders, or the public, maintaining fairness and equity in company management.
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