Section 420(2) of the Companies Act, 2013 empowers the Tribunal, at any time within two years from the date of the order, to amend any order passed by it with a view to rectifying any mistake apparent from the record. The power is narrower than the recall power. It is directed at clerical or arithmetical errors and other mistakes that are evident on the face of the record, not at errors that require a re-examination of the evidence or a re-argument of the case.
The “Mistake Apparent from the Record” Standard
A mistake is apparent from the record where it can be demonstrated without any further evidence or argument. A clerical error, an arithmetical miscalculation, or an obvious misstatement of a fact that is already on the record is a mistake apparent from the record. A disputed question of law, a finding of fact that is challenged on the basis of new evidence, or an error that requires the Tribunal to reconsider the merits is not a mistake apparent from the record.
The Two-Year Limitation
The rectification must be sought within two years from the date of the order. The period is computed from the date of the order, not from the date of the discovery of the mistake. An application filed after the two-year period is not maintainable.
The Bar After Appeal
The first proviso to Section 420(2) provides that a rectification application filed subsequent to the filing of an appeal is not entertainable. The NCLAT has applied the proviso to hold that once an appeal is filed, the Tribunal cannot rectify the order, and the rectification must be sought from the Appellate Tribunal. The bar is designed to prevent the parallel exercise of jurisdiction by the Tribunal and the Appellate Tribunal.
The Procedure
The rectification application is filed under Rule 154 of the NCLT Rules, and it must specify the mistake and the correction sought. The application is heard by the Bench that passed the order, and the Bench may allow or reject the application. The rectification order is a part of the original order, and it relates back to the date of the original order.
A technically sound rectification application is precise. It identifies the mistake, the evidence on the record that demonstrates the mistake, and the correction that is sought. A broad application that seeks a re-hearing is likely to be dismissed.
Call to Action
Anuj Desai & Associates advises companies and parties on the rectification of NCLT orders—from the “mistake apparent from the record” standard and the two-year limitation to the bar after appeal and the procedure. If you are considering a rectification application, we can help you assess whether the power is available.
📧 office@anujdesaiassociates.com
📞 9619456656
🌐 https://anujdesaiassociates.com
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