Companies Act Section 427

Companies Act, Section 427: President, Members, Officers and Employees of Tribunal and Appellate Tribunal to be Public Servants

Section 427 of the Companies Act, 2013 formally designates the President, Chairperson, Members, officers, and employees of both the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) as public servants, as defined under Section 21 of the Indian Penal Code, 1860 (IPC). 

This classification is legally significant and carries important consequences meant to uphold the integrity, accountability, and ethical conduct of individuals serving in these judicial bodies.

1. Who is Covered Under This Provision?

The following persons are all treated as public servants under the law:

The President of the NCLT, All Members of the NCLT, All officers and employees assisting the NCLT. Likewise, it also applies to:

The Chairperson of the NCLAT, All Members of the NCLAT, All officers and employees under the Appellate Tribunal.

This broad coverage ensures that everyone involved in the functioning of these Tribunals is held to the same ethical and legal standards.

2. Purpose of Declaring Them as Public Servants

Being designated as “public servants” is not ceremonial it creates legal obligations and safeguards such as:

Duty to act honestly and lawfully in all official work. Consequences for corruption or misuse of power, including criminal prosecution.

Protection from unnecessary litigation when performing official duties in good faith.

This status strengthens the integrity of the judicial process and assures the public that such officials are accountable under criminal law for misconduct.

3. Applicable Provisions Under the Indian Penal Code

Section 21 of the IPC covers numerous categories of individuals serving in government-related roles. By bringing Tribunal officials under this classification, they become subject to criminal provisions including:

Anti-corruption laws, Punishment for bribery, fraud, or abuse of office, Protection against assault, obstruction, or intimidation while performing official duties.

This legal framework enhances both ethical responsibility and security for those working within NCLT and NCLAT.

Importance of Section 427

This section plays a meaningful role in professionalizing and safeguarding Tribunal operations by ensuring:

High standards of conduct and accountability. Confidence among litigants that justice is delivered impartially.

Strong deterrence against malpractice within the Tribunal system. Legal protection for officials acting responsibly and within the scope of their duties.

It reinforces that Tribunal Members and staff are not merely administrative workers but custodians of justice with serious responsibilities.