2017 (9) TMI 1951 - Tri - Companies Law

Waiver of the requirement in respect of right to apply to the Tribunal under Section 241 of the Act - Section 244 read with Section 241 of Companies Act, 2013 - HELD THAT - Admittedly, the applicant is not a member. Therefore, the applicant cannot seek waiver of any of the conditions specified in clauses (a) and (b) of Section 244 (1). The proviso also clearly stipulates that the Tribunal may, on an application made to it in this behalf, waive all or any of the requirements specified in clause (a) and (b) so as to enable the members to apply under Section 241. Thus, it is clear that the Tribunal can waive all or any of the conditions to enable the members to apply under Section 241. Thus, waiver can be granted by the Tribunal only on the application filed by a member or members, but, not by a third party. A plain reading of Section 244(1) of Companies Act, 2013 provides that members of a company have a right to apply under Section 241 of the Act. The very opening of Section 244 provides that members of a company have a right to apply under Section 241. A non-member, therefore, cannot apply for waiver under Section 244. The proviso also provides that waiver can be ordered on the application made to the Tribunal by a Member - the contention of the learned counsel for applicant that the proviso to Section 244(1) empowers a non-member to seek waiver since the applicant is a non-member, it cannot maintain this application under Section 244 of Companies Act, 2013, cannot be agreed upon. Application dismissed.

Summary

Issues:
1. Company application for waiver under Sections 241-242 of Companies Act, 2013.
2. Whether a non-member can seek waiver under Section 244 of the Act.

Analysis:
1. The company filed an application under Sections 241-242 of the Companies Act, 2013, seeking waiver of requirements to maintain the application. The application highlighted mis-governance in the private and corporate sector, focusing on public interests and financial impacts. Allegations were made against the respondents regarding asset diversion and fraud during mergers. The petitioner emphasized the serious nature of the complaints and the need for waiver to file a petition addressing oppression and mismanagement.

2. The key issue revolved around whether a non-member could seek waiver under Section 244 of the Act. The Tribunal examined the provisions of Section 244(1) and (2) which outline the right to apply under Section 241, specifying conditions for members to file petitions based on share capital or total number of members. The proviso allowed the Tribunal to waive requirements to enable members to apply under Section 241. The applicant contended that a non-member could seek waiver under the proviso, citing decisions from NCLT and High Courts. However, the Tribunal held that only members could seek waiver, as per the provisions of the Act.

3. The applicant's counsel argued that the proviso to Section 244 empowered non-members to seek waiver, citing various legal decisions. However, the Tribunal disagreed, emphasizing that Section 244(1) clearly states that members have the right to apply under Section 241. The proviso also specified that waiver could be granted on the application of a member, not a third party. As the applicant was a non-member, the Tribunal rejected the application, concluding that a non-member cannot maintain an application under Section 244 of the Companies Act, 2013.