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2024 (9) TMI 626 - AT - Companies LawOppression and mismanagement - Recall of an earlier order - appeal against order should have been filed, which was not done - HELD THAT - In Budhia Swain and others Vs Gopinath Deb and Others 1999 (5) TMI 596 - SUPREME COURT the Hon ble Supreme Court held ' The power to recall a judgment will not be exercised when the ground for re-opening the proceedings or vacating the judgment was available to be pleaded in the original action but was not done or where a proper remedy in some other proceeding such as by way of appeal or revision was available but was not availed. The right to seek vacation of a judgment may be lost by waiver, estoppel or acquiescence.' Admittedly the order dated 20th December, 2023 did not fall within the four conditions as enumerated in para 8 of Budhila Swain. Instead of filing an appeal against the order dated 20.12.2023, the appellant had preferred a recall application, not permissible under Rule 11 of NCLT Rules. There are no illegality in the impugned order dated 05.04.2024 - there is no merit in this appeal and accordingly it is dismissed.
Issues:
Appeal against order dismissing company petition on grounds of incomplete information due to appellant's ill health, Restoration/recall application dismissed without proper reasoning, Maintainability of appeal against impugned order dated 5th April, 2024 seeking restoration of order dated 20th December, 2023, Distinction between review and recall, Legal grounds for recalling an order, Inherent power of the Tribunal to recall judgment, Upheld orders by NCLAT and Supreme Court, Comparison with Budhia Swain case, Lack of jurisdiction, Fraud or collusion, Mistake of the court prejudicing a party, Failure to file an appeal against the order dated 20th December, 2023, Permissibility of recall application under Rule 11 of NCLT Rules, Legality of impugned order dated 5th April, 2024. Analysis: The appellant filed an appeal under Section 421 of the Companies Act, 2013 against the order dated 5th April, 2024, passed by the Ld. National Company Law Tribunal, Mumbai Bench in Restoration Application No. 7 of 2024 in CP No.4024 of 2018. The company petition was dismissed on account of the appellant's inability to provide certain information due to her bad health, leading to a Restoration/recall Application No.7/2024. The respondent argued against the maintainability of the appeal, citing the lack of an appeal against the original order dated 20th December, 2023. The appellant's ill health was used as a ground for not filing the necessary documents, but questions arose regarding why only the appellant filed the appeal and recall application when there were three other petitioners involved. The Tribunal noted that the order dated 20th December, 2023 was appealable, and since no appeal was filed against it, the recall application was not maintainable. In a reference to the Union Bank of India Vs Dinkar T Venkatasubramanian case, the Tribunal highlighted the distinction between review and recall, emphasizing that the power to recall a judgment is inherent in the Tribunal. The Tribunal also referenced the Budhia Swain case, which outlined the grounds for recalling an order, such as lack of jurisdiction, fraud, mistake of the court, or failure to serve a necessary party. The Tribunal found that the order dated 20th December, 2023 did not fall within these grounds and that filing a recall application instead of an appeal was impermissible under Rule 11 of the NCLT Rules. Ultimately, the Tribunal examined the impugned order dated 5th April, 2024, and found no illegality in it. As a result, the appeal was dismissed, and pending applications were closed. The judgment emphasized the importance of following the correct legal procedures and grounds for challenging orders to maintain the integrity of the legal process.
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