2018 (7) TMI 2024 - Tri - Companies Law

Maintainability of application/affidavit - Rectification of order - rights issue - direction to pay dividends and interest accrued on such dividends in respect of three rights issue - Rule 154 of NCLT Rules - HELD THAT - The Tribunal can rectify any order where there is an arithmetic or clerical error occurred in the order. The power of Tribunal under Rule 154 NCLT Rules is limited for effecting correction in case of clerical or arithmetical mistakes or error arising from accidental slip or omission. It is not the case of Applicant that there is any clerical or arithmetical mistake occurred in the order. On the other hand she is asking for review of the order as if this Tribunal ought to have granted relief in her favour that she is entitled for the dividends declared on the allotment of shares in connection with three rights issue. So it is apparent that Tribunal by order dated 14.03.2017 had not committed any clerical or arithmetic error but the case of Applicant that Tribunal ought to have granted a relief of her entitlement to the dividends basing on the reliefs prayed by her. The learned Counsel for Respondent; rightly pointed that the order of this Tribunal stands merged with the order of Hon ble NCLAT as order of this Tribunal was questioned before Hon'ble NCLAT and it was confirmed. This Tribunal cannot order for any rectification. In fact, the Applicant is seeking review of the judgement. The power of review is not conferred on the Tribunal. Secondly, when appeal was preferred to Hon'ble NCLAT, Section 420 (2) prohibits the tribunal for making any amendment. There is no clerical or arithmetical error in the order. Secondly, the appeal was preferred against the order to the Hon ble NCLAT. Therefore, this order becomes merged with the order of the Hon'ble NCLAT. Thirdly, Tribunal has no power to review. Further, Applicant has not preferred any appeal for not granting any relief prayed by her to Appellate Authority - the present Application filed by the Applicant is not maintainable and is liable to be dismissed.

Summary

Issues:
Rectification of order to include payment of dividends and interest accrued on shares from three rights issues.

Analysis:
1. The Applicant filed an application seeking rectification of an order passed by the Tribunal related to three rights issues. The Applicant, Mrs. Mallina Bharathi Rao, filed CP No. 13/2013, seeking various reliefs, including the allotment of shares and payment of dividends accrued on those shares from 1991-92, 1995-96, and 2004-2005. The Tribunal disposed of the petition by directing the Respondents to allot shares but did not include a directive for the payment of dividends.

2. The Applicant argued that the Tribunal inadvertently omitted the directive for the payment of dividends in its order and sought rectification. The Respondents opposed the application, stating that it was essentially a request for a review of the order, which is impermissible under Rule 154 of NCLT Rules. The Respondents also highlighted that the Tribunal's order had been appealed, and the appeal was dismissed by NCLAT.

3. The Tribunal considered whether the application under Section 154 of NCLT Rules was maintainable. It was emphasized that the power of the Tribunal under Rule 154 is limited to rectifying clerical or arithmetical errors, not granting additional reliefs. The Tribunal found that there was no clerical or arithmetical mistake in the order and that the Applicant was essentially seeking a review of the judgment, which the Tribunal is not empowered to do.

4. The Respondents pointed out that they had appealed the Tribunal's order to NCLAT, which confirmed the order. As a result, the Tribunal's order merged with NCLAT's order, and the Tribunal could not order any rectification. The Tribunal reiterated that the Applicant should have appealed if dissatisfied with the order and that the present application was not maintainable on these grounds.

5. Ultimately, the Tribunal dismissed the application, concluding that there was no clerical or arithmetical error in the order, the order had been appealed and confirmed by NCLAT, and the Tribunal lacked the power to review its own decision. The Applicant's failure to appeal further supported the dismissal of the application.