CTCP allows you access to the client-to-client protocol used to perform certain client specific actions between different clients on the network. The CTCP mechanism works by sending a specially coded message to another user whose client is supposed to reply with a reply message of the type, or with an error message, unless you sent it to a channel.
For example, if you do:
ctcp BigCheese VERSION
you will receive:
*** CTCP REPLY VERSION from BigCheese: ircII 2.2.2 *IX.
The <command> field may be of several types, new ones are introduced all the time, but there is a mechanism for you to find out what you can use: see CLIENTINFO. If the nickname is "*" the output is sent to the current channel.
See Also: ctcp/clientinfo on/ctcp on/ctcp_reply