2019 (5) TMI 1818 - Tri - Companies Law

Oppression and Mismanagement - absolute and unconditional right to ask for an unconditional withdrawal - HELD THAT - It is a settled position of Law that when a Petitioner seeks for a withdrawal simpliciter, the Tribunal will not continue with the said Petition and in order to put an end to the matters complained of it would be in the interest of all the parties involved that such withdrawal simpliciter be allowed - It is also pertinent to note that the main Company Petition has been filed citing various acts of oppression and mismanagement in the affairs of R1 Company. However, both the Petitioner and R1 have entered into a Settlement Agreement dated 27.04.2019 and have put to rest all their differences. This Tribunal has observed that none of the parties except R5 has raised any objection for withdrawal. The objections raised by R5 mostly revolve around the internal disputes in R4 Company relating to the acts of Alanda media and Entertainment Pvt Ltd and four others in taking over R4 Company and removal of R5 other directors from R4. Those disputes cannot be raised in the present Company Petition and also do not form any valid ground for rejecting the instant Application for withdrawal of main Company Petition. It is the statutory duty imposed on Tribunal to ensure that the Tribunal puts an end to the Litigation by passing appropriate orders, considering the facts and circumstances of the Case. In the instant case, it is the main litigating parties who have put an end to the disputes among themselves and have come before the Tribunal praying to permit the withdrawal of the Company Petition which would ultimately result in putting an end to the Litigation between the parties - Application allowed.

Summary

Issues:
Application for withdrawal of Company Petition under Rule 82 of NCLT Rules, 2016.

Analysis:
1. The Application sought permission to withdraw the Company Petition along with pending Interlocutory Applications citing a settlement between the Petitioner and Respondent No. 1, which had been honored. The Petitioner intended to withdraw the proceedings due to the settlement agreement.

2. The Tribunal noted that the Petitioner and Respondent No. 1 had indeed entered into a settlement agreement, and both parties expressed their intention to withdraw the main Company Petition. However, proper procedural steps under Rule 82 of NCLT Rules, 2016 had not been followed initially.

3. Various hearings were conducted where counsels for the parties presented written submissions and arguments. The Petitioner emphasized its unconditional right to withdraw the Petition, while Respondents also supported the withdrawal, citing legal precedents to support their stance.

4. Respondent No. 5 raised objections to the withdrawal, highlighting internal disputes within the company, but the Tribunal found these disputes irrelevant to the present Company Petition. The Tribunal considered the settlement between the main litigating parties as crucial in deciding the withdrawal.

5. Citing legal precedents and statutory provisions, the Tribunal emphasized the importance of allowing withdrawal when parties seek it without asking for anything more, especially after settling their disputes. The Tribunal concluded that permitting the withdrawal would bring an end to the litigation between the parties.

6. Ultimately, the Tribunal granted permission for the withdrawal of the Company Petition, dismissing it as withdrawn along with all pending Interlocutory Applications. The interim orders were vacated, and the matter was closed with no order as to costs.