Under Section 213(b), the Tribunal must record satisfaction and hear affected parties before directing investigation or involving external agencies.

The appellants challenged two orders passed by the NCLT, Kolkata Bench, in Transfer Petition No. 26(KB)2025: the order dated 12 December 2025 challenged in Company Appeal (AT) No. 55 of 2026, and the order dated 13 February 2026 challenged in Company Appeal (AT) No. 137 of 2026.

The underlying proceedings arose from allegations of fraud and misconduct concerning Startups Club Services Pvt. Ltd. and Startups Club Networks LLP, in proceedings initiated under, inter alia, Sections 73(4) and 213 of the Companies Act, 2013.

In the first order, the NCLT directed issuance of notice to the Enforcement Directorate and required tracking information to be placed on record.

In the subsequent order, the NCLT issued notices to the Enforcement Directorate and the CBI for the same purpose.

The appellants contended that these directions constituted premature steps towards an investigation under Section 213(b), passed without recording satisfaction, reasons, or granting them an opportunity of hearing.

1. Whether the NCLT could issue notices to the Enforcement Directorate and call for tracking information at the inception of proceedings under Sections 73(4) and 213 of the Companies Act, 2013, without first recording satisfaction under Section 213(b) and hearing the affected parties.

2. Whether the directions issued to the Enforcement Directorate and the CBI in the orders dated 12 December 2025 and 13 February 2026 violated the statutory procedure under Section 213(b) and the principles of natural justice.

Section 213(b) of the Companies Act, 2013, which permits the Tribunal to direct investigation into a company’s affairs only when it is satisfied that circumstances suggest fraudulent or unlawful conduct, fraud or misfeasance by persons concerned with the company, or withholding of information from members.

Before directing an investigation, or taking steps that effectively initiate such investigation, the Tribunal must apply its mind, record its satisfaction, and provide the concerned parties a reasonable opportunity of being heard.

The Court further applied the principles of natural justice and the requirement that judicial orders contain reasons, particularly where they may carry civil consequences, economic effects, or social stigma.

The NCLAT held that the NCLT’s directions to the Enforcement Directorate and the CBI were not merely administrative, because seeking tracking information from external investigative agencies constituted an initial step towards investigation and could adversely affect the company and the appellants.

Section 213(b) required the NCLT first to examine whether any of the statutory circumstances existed, record a reasoned satisfaction, and hear the affected parties before directing investigative steps.

However, the impugned orders did not disclose any consideration of the Section 213(b) parameters, did not record why the involvement of the Enforcement Directorate or CBI was necessary, and were passed at the initial stage without hearing the appellants on that issue.

The absence of reasons and denial of an opportunity of hearing rendered the directions procedurally improper, perverse, and violative of natural justice.

The directions in the order dated 12 December 2025 requiring notice to the Enforcement Directorate and production of tracking information were quashed.

The corresponding directions in the order dated 13 February 2026 concerning the Enforcement Directorate and CBI were also quashed.

The matter was remitted to the NCLT, Kolkata Bench, with liberty to pass fresh orders only after hearing the appellants and other concerned parties, considering the requirements of Section 213(b), recording appropriate satisfaction and reasons, and determining whether issuance of notices to the Enforcement Directorate or CBI was legally necessary.

The underlying proceedings in Transfer Petition No. 26(KB)2025 were left open for determination in accordance with law.