2022 (8) TMI 505 - Tri - Companies Law

Seeking direction to transfer the petitions and other proceedings in its present stage, before the Hon'ble Principal Bench at New Delhi - HELD THAT - The entire gamut of the investigation arises from the transaction of Adarsh Credit 85 Cooperative Society Limited (ACCSL) which allegedly took money from public and several key persons concerned with this society, allegedly siphoned off amounts to various individuals and group companies. Taking note of the factors which has been stated by the applicant and keeping in mind the fraud alleged which is to the extent of ₹ 5003 Crores and the various proceedings pending before different NCLT Benches, the interim Orders those have been passed and the applications which have been filed and likely to be filed by the interveners, it will be appropriate in the interest of applicant/Union of India as well as the various respondents to have a common Bench for hearing of all the matters on merits. The plea of prejudice to respondents is a mirage. The various Company Petitions pending before different bench of Chandigarh, Jaipur, Ahmedabad, Kolkata, Chennai and Allahabad as set out in the prayer are directed to be transferred to New Delhi Bench along with all interim applications and case files. Thereafter, all the Company Petitions as mentioned in the prayer will be transferred to a Special Bench consisting of Sh. Dharminder Singh, Member (Judicial) with Sh. Binod Kumar Sinha, Member (Technical). Petition disposed off.

Summary

Issues:
Transfer of company petitions to a common bench for joint decision-making.

Analysis:
The Union of India filed an application seeking the transfer of multiple company petitions pending before different NCLT benches to the Hon'ble Principal Bench at New Delhi for a joint decision with another company petition. The application requested the continuation of proceedings, maintenance of interim reliefs, and prevention of alienation of properties by respondents. The investigation into the affairs of 125 Adarsh Group of Companies & LLPs by SFIO led to orders for freezing assets and restraining directors and KMPs from dealing with properties. The Central Government's approval for filing references under relevant sections of the Companies Act aimed to protect public interest. Interim orders for asset attachment were obtained from various NCLT benches, and new materials uncovered more individuals involved in the alleged fraud.

The applicant highlighted the need for a common bench due to the complexity of the case involving siphoning off public funds, estimated fraud amounting to crores, and the risk of conflicting orders from different benches. The multiplicity of proceedings could disadvantage the Union of India and investigating agencies, leading to distraction from the core issue. Respondents' objections of prejudice were countered by the argument for efficient adjudication before a single bench. The applicant faced challenges in responding to individual applications and sought a common platform for addressing various reliefs and concerns raised by multiple parties.

Considering the interests of all parties and the magnitude of the alleged fraud, the Tribunal ordered the transfer of all mentioned company petitions to the Special Bench at New Delhi. The Special Bench, comprising specific members, would hear these matters along with any related cases in the future. The continuation of interim reliefs was also addressed, with the Special Bench authorized to decide on extensions or necessary orders for each case. The Tribunal's decision aimed to streamline the proceedings, ensure efficient adjudication, and protect the interests of both the applicant and respondents involved in the complex investigation.