Section 270 of the Companies Act, 2013
Section 270 of the Companies Act, 2013 deals with Compromise, Arrangement, and Reconstruction of companies.
Section 270 — Power of Tribunal to Make Orders
Under this section:
The National Company Law Tribunal (NCLT) has the power to make any order it thinks fit for compromise or arrangement between a company and its members or creditors or any class of them, or for reconstruction of a company.
The Tribunal may also make an order concerning the transfer of shares, property, rights, liabilities, or obligations of the company as part of the compromise or arrangement.
The purpose is to facilitate restructuring, merger, amalgamation, or other schemes for the benefit of the company and its stakeholders.
The section empowers the Tribunal to supervise and approve schemes that affect the company’s capital or members or creditors, ensuring that the interests of all parties are protected.
In brief:
Section 270 grants the NCLT authority to sanction arrangements or compromises involving the company’s structure or obligations.
It is a key provision used in corporate reorganizations like mergers, demergers, or financial restructurings.
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