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Navigating the National Company Law Tribunal (NCLT) 30:41 Jackson: Nia, we’ve mentioned the NCLT—the National Company Law Tribunal—a few times now, but I think it’s worth really digging into what that process looks like for a listener who’s actually facing it. It seems to be the place where "good deals go to wait." Why is the NCLT such a critical, and sometimes frustrating, part of the journey?
31:03 Nia: Well, Jackson, the NCLT is essentially the "gatekeeper" for corporate restructuring in India. Under Sections 230 to 232 of the Companies Act, any merger or amalgamation has to be sanctioned by the Tribunal. It’s not just a rubber stamp. The NCLT has a duty to look out for the interests of all stakeholders—not just the big shareholders, but the minority shareholders, the creditors, and even the "public interest."
31:29 Jackson: So, they’re checking to make sure nobody is getting squeezed out or cheated in the process?
8:55 Nia: Exactly. They look at the "fairness" of the valuation—which brings us back to Rule 25A—and they ensure that all the proper disclosures have been made. One of the biggest reasons for delay at the NCLT is "procedural non-compliance." If you didn't give the right notice to your creditors, or if your shareholder meeting wasn't conducted exactly according to the rules, the NCLT can send you back to start over.
31:56 Jackson: And with the backlog of cases in the Indian legal system, "starting over" can mean a delay of months.
32:02 Nia: It really can. But there’s a silver lining in the recent reforms. We’re seeing an expansion of "fast-track mergers" under Section 233. This allows certain mergers—like those between small companies or between a holding company and its wholly-owned subsidiary—to bypass the NCLT entirely. Instead, you get approval from the Regional Director and the Official Liquidator. It’s much faster.
32:24 Jackson: That’s a huge relief for internal restructurings or those "reverse flips" we talked about. But for a big cross-border deal, you’re still likely stuck in the main NCLT process?
32:33 Nia: Most likely, yes. And that’s why "NCLT strategy" is now a part of deal design. You have to anticipate the questions they’ll ask. For example, if you’re doing a cross-border merger, the NCLT will want to see that you have RBI approval—or at least that you meet the "deemed approval" conditions. They’ll also look at whether the merger is being used for "tax avoidance."
32:53 Jackson: Oh, that’s an interesting point. I saw that there’s a new tax reform effective April 1, 2025, about "loss carry-forward."
33:02 Nia: Yes! This is a big one for anyone thinking about a merger. It used to be that you could "reset" the eight-year limit for carrying forward business losses through a merger. But for any merger after April 2025, you can only carry forward those losses for the *remaining* portion of the original eight years. The government is trying to curb "tax arbitrage"—where people buy failing companies just to use their tax losses.
33:25 Jackson: So, the NCLT is looking at the deal through that lens too—is this a genuine business combination, or just a tax play?
8:55 Nia: Exactly. And then you have the "multi-agency coordination" problem. While you’re waiting for the NCLT, you might also be waiting for the Competition Commission, or SEBI if you’re a listed company. If you do these in a sequence, you’re looking at that 220-day average we mentioned. The "pro" move is to do them in parallel. You file with the CCI and the NCLT at the same time, and you make sure your disclosures are consistent across both.
33:57 Jackson: Consistency seems like a simple thing, but I imagine when you have different teams of lawyers working on different filings, it’s easy for things to get out of sync.
34:06 Nia: It’s a major risk! If the CCI filing says one thing about your market share and the NCLT filing says something slightly different about your strategic rationale, a regulator is going to flag it. This is why we’re seeing the rise of "unified disclosure" platforms—where AI helps ensure that every single document, from the scheme of arrangement to the SEBI disclosure, is pulled from the same "source of truth."
34:29 Jackson: It’s about building a "regulatory fortress" around your deal. No gaps, no inconsistencies, nothing for a skeptical judge or regulator to latch onto.
34:39 Nia: That’s the goal. And for our listeners, the practical advice is: don't treat the NCLT as a "legal formality" for the lawyers to handle at the end. Treat it as a strategic stakeholder from day one. Get your "fairness opinion" early, ensure your creditor consents are ironclad, and for heaven’s sake, make sure your valuation is "evidence-linked." If you do that, you can turn a nine-month ordeal into a six-month success story.
35:02 Jackson: It really emphasizes that in 2026, the "dealmaker" isn't just the person who can negotiate the price; it’s the person who can navigate the system.