2019 (6) TMI 1545 - Tri - Companies Law

Issuance of witness summons - applicant submitted that the said documents were furnished to the Applicant on 01.11.2018 and on the same day the argument was commenced without giving time to scrutinize the documents by the Applicant - HELD THAT - A discretion is conferred on the Tribunal to regulate its own procedure and be guided by the principles of natural justice. It is considered just and necessary that evidence should be led to ascertain the authenticity of the documents produced vide IA No. 390/2018. Establishing the authenticity of these documents is vital to the determination of the issues raised in the two company petitions. Since the NCLT empowered under section 424(2) of the Companies Act, 2013 and Rule (39)(1) of the NCLT Rules, 2016 to deal with the matter of taking evidences, This Tribunal has not dealt with the case laws quoted by the parties - Put up the matter on 30.08.2019.

Issues Involved:
1. Issuance of witness summons for cross-examination.
2. Admissibility and authenticity of disputed documents.
3. Appointment of a Commissioner for evidence collection.
4. Summary nature of NCLT proceedings and application of natural justice principles.

Issue-Wise Detailed Analysis:

1. Issuance of Witness Summons for Cross-Examination:
IA No. 28/2019 & IA 33/2019:
- Applicant's Request: The applicants sought issuance of witness summons to examine certain individuals, alleging that the documents provided were fictitious and they needed time to scrutinize them.
- Respondent's Counter: The respondents argued that cross-examination is discretionary in NCLT proceedings, which are summary in nature, and that the Tribunal should adjudicate based on affidavits unless it is a rare case requiring cross-examination.
- Tribunal's Decision: The Tribunal acknowledged that strict civil court procedures do not apply and emphasized the principles of natural justice. It decided that evidence should be led to ascertain the authenticity of the documents, but it did not allow the applications for witness summons, stating that the parties could prove the documents' authenticity during the hearing of the main petition.

2. Admissibility and Authenticity of Disputed Documents:
IA No. 29/2019 & IA No. 30/2019:
- Applicants' Request: The applicants sought to eschew disputed photocopies of documents filed by the respondents, claiming they were inadmissible.
- Respondents' Counter: The respondents contended that the applicants were falsely raising doubts about the documents' admissibility and had not demonstrated a fit case for eschewing them.
- Tribunal's Decision: The Tribunal did not specifically address the admissibility issue in the judgment but focused on the need to establish the authenticity of the documents through evidence, appointing a Commissioner for this purpose.

3. Appointment of a Commissioner for Evidence Collection:
- Tribunal's Action: The Tribunal appointed Shri D. Gopala Krishna, Advocate, as the Commissioner to record evidence regarding the veracity of the documents. The Commissioner was tasked with receiving evidence by affidavit and allowing cross-examination of witnesses, strictly adhering to the mandate and time-frame provided.
- Remuneration: The Commissioner was to be paid ?2,00,000/- plus incidental expenses, equally borne by the applicants in both IAs.

4. Summary Nature of NCLT Proceedings and Application of Natural Justice Principles:
- Legal Framework: The Tribunal referred to Section 424(1) of the Companies Act, 2013, which allows it to regulate its own procedure and be guided by natural justice principles, rather than strict civil court procedures.
- Relevant Case Law: The Tribunal cited the Supreme Court judgment in Union of India Vs. Madras Bar Association (2010) 11 SCC 1, which supports the flexibility of Tribunals in regulating their procedures.
- Tribunal's Approach: Emphasizing the summary nature of its proceedings, the Tribunal decided not to allow the applications for witness summons but provided a mechanism to test the documents' authenticity through the appointed Commissioner.

Conclusion:
The Tribunal dismissed the applications for witness summons (IA No. 28/2019 & IA 33/2019) but appointed a Commissioner to record evidence regarding the authenticity of disputed documents. The Tribunal emphasized the summary nature of its proceedings and the application of natural justice principles, allowing the parties to prove their cases during the main petition hearing. The matter was scheduled for further proceedings on 30.08.2019.

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