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2021 (6) TMI 345 - Tri - Companies LawSeeking direction to investigate the affairs of Company by Inspector(s) appointed by the Central Government - freezing of assets of the R-1 Company for a period of 3 years pursuant to the investigation by the Inspector(s) appointed by the Central Government - HELD THAT - In the instant case, though the Petitioner has no locus standi even to raise the alleged grievance before statutory Authorities or to approach various Courts/Tribunal, used to file frivolous Applications/Petitions on untenable grounds. The Petitioner did not stop to file its frivolous Petitions/Applications, even when the Central Government has passed a detailed order dated 10th November, 2017, in pursuance to an order passed by Delhi High Court by inter alia holding that there is nothing wrong in the affairs of 3 Companies involved in the instant Application. Therefore, the contentions/allegations of the Petitioner that there are various illegalities committed by Respondent and in all three Companies in question has no substance at all, and they are baseless and liable to be rejected. The Petitioner has no locus standi to file instant Petition, and it wants to order roving enquiry for ulterior purpose by abusing the process of law and resorting to forum shopping - petition dismissed.
Issues Involved:
1. Eligibility of the Petitioner to file the application under Section 213 of the Companies Act, 2013. 2. Prima facie case for ordering an investigation into the affairs of the Respondent Company. 3. Impact of previous adverse orders from various courts on the current petition. Issue-wise Detailed Analysis: 1. Eligibility of the Petitioner: The Tribunal examined whether the Petitioner, a non-profit company, had the locus standi to file the petition under Section 213 of the Companies Act, 2013. The Respondents argued that the Petitioner was not a member, creditor, or depositor of the Respondent Company and thus lacked standing. The Tribunal agreed, noting that the Petitioner was neither an aggrieved party nor a bona fide litigant. The Tribunal emphasized that Section 213(b) of the Act is intended to protect the interests of members, creditors, and depositors, and not to entertain applications from rank outsiders. The Tribunal found that the Petitioner failed to demonstrate any legitimate interest or connection to the Respondent Company. 2. Prima Facie Case for Investigation: The Tribunal assessed whether the Petitioner established a prima facie case for an investigation into the affairs of the Respondent Company. The Petitioner alleged various fraudulent activities and mismanagement, including the diversion of assets worth crores to a private trust and non-compliance with NBFC regulations. However, the Tribunal found these allegations to be vague and unsupported by substantial evidence. The Tribunal noted that the Petitioner had previously raised similar issues in other forums, including the High Court of Karnataka and the Supreme Court of India, without success. The Tribunal concluded that the Petitioner failed to present a compelling case warranting an investigation under Section 213 of the Companies Act, 2013. 3. Impact of Previous Adverse Orders: The Tribunal considered the impact of previous adverse orders from various courts on the current petition. The Petitioner had filed multiple petitions and complaints against the Respondents in different forums, all of which were dismissed. The High Court of Karnataka had dismissed several writ petitions filed by the Petitioner, imposing costs for forum shopping and abuse of process. The Tribunal highlighted the High Court's findings that the Petitioner was engaging in speculative litigation and repeatedly filing frivolous petitions. The Tribunal noted that the High Court had dismissed the Petitioner’s claims with costs, indicating a pattern of vexatious litigation. Consequently, the Tribunal found that the Petitioner was estopped from insisting on adjudication of the same issues before the Tribunal. Conclusion: The Tribunal concluded that the Petitioner lacked the locus standi to file the application under Section 213 of the Companies Act, 2013, and failed to establish a prima facie case for ordering an investigation. The Tribunal also acknowledged the adverse findings of the High Court of Karnataka regarding the Petitioner’s conduct. Therefore, the petition was dismissed, and all pending interlocutory applications were rendered infructuous. No order as to costs was made.
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