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TMI Blog2017 (2) TMI 657X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants to file a petition for amendment and may argue on the question of removal of 11th respondent, if he is removed by the decision of the EGM during the pendency of the Company Petition. In case the question of maintainability and/or waiver on merit is decided in favour of the appellants, it is always open to the Tribunal to pass appropriate order restoring the original position of Respondent No. 11, was at the time of filing of the Company Petition. - Company Appeal (AT) No. 17, 18 and 19 of 2017 - - - Dated:- 3-2-2017 - Mr. Balvinder Singh and S.J. Mukhopadhaya, JJ. For The Appellant : Mr. C.A. Sundram, Senior Advocate, Mr. Arun Kathpalia, Senior Advocate with Mr. Manik Dogra, Mr. Somasekhar Sundresan, Mr. Jaiyesh Bakhshi, Ms. Sonali Bakshi, Mr. Rohan Jaitley, Mr. Nikhil Rohtagi, Ms. Rohini Musa, Mr. Ravi Tyagi, Mr. Shubhansh Gupta, Ms. Sanya Kapoor, Mr. Pallav Pandey, Mr. Akshay Sharma, Mr. Shashi Shekhar, Ms. Mohana Nijhawan, Mr. Kabir Chillwar and Mr. Satik Mahapatra, Advocates For The Respondent : Dr. Abhishek Manu Singhvi with Mr. Rajiv Nayar, Senior Advocates, Mr. Amit Sibbal, Mr. Darpan Wadhwa, Mr. Prateek Seksaria, Ms. Suman Rohatgi ad Mr. Aditya Shan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e hearing of the matter, a consent order came to be passed whereby urgent hearing of the petition could be done. However, 14th, 17th and 20th respondents within few days of the consent order and in utter violation of order dated 22nd December 2016 made requisition to call for an EGM to remove the 11th respondent as the Director of the 1st respondent company. This led to the appellants to file a Contempt Petition. 5. It is further contended that by impugned order dated 18th January 2017, the Tribunal took a view that the attempt to remove 11th respondent from the Board of Directors did not constitute contempt of court, inter alia on the ground that contempt jurisdiction is a narrow and strict jurisdiction. It is further contended that second impugned order dated 18th January 2017 did not at all deal with the stay application on merits and only set out the views of Tribunal. On the subject matter of removal of 11th respondent on which a stay was sought, the Tribunal directed that an affidavit may be filed by the appellants instead of an application to amend the Company Petition within three days. This clearly indicated that the Tribunal wanted pleadings on the proposed removal so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Singhvi, Shri S.N Mookerjee, Shri Ravi Kadam and Shri Mohan Parasaran conceded for the following Consent Order as mentioned below: The answering Respondents' side has agreed to file reply within 15 days hereof The Counsel appearing on behalf of Rll, who is evidently sailing along with the Petitioners side, agreed to file reply to the company petition within one week hereof enabling the answering Respondents to file response to file response to Rl 1 reply with one week thereof and reply to the main Petition within 15 days hereof. The Petitioner shall file rejoinder to the reply within 15 days thereof. In case Rl 1 notices any new facts in the response of the answering Respondents to Rll Reply, he is at liberty to further respond to the same within 15 days. It has also been further agreed by all the parties, more specially by the Petitioner Counsel, R11 Counsel and the Counsel on behalf of the answering Respondents, that they will not file any interim Application or initiate any action or proceedings over this subject matter pending disposal of this Company Petition. They have also further agreed that they will not violate the time schedule mentioned above. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of Director of the Company they have committed Contempt of Court. 14. In the Contempt Petition, a prayer was also made by appellants to stay the EGM due to be held on 6th February 2017. According to appellants that if EGM is allowed to be held, it would constitute a deliberate and contemptuous violation of order dated 22nd December 2016 and, therefore, it was necessary to restrain and injunct the respondents from holding such a meeting or transacting any business. 15. The Tribunal, by impugned order dated 18th January 2017 while held that no case of contempt has been made out, given the background in which the order dated 22nd December 2016 was passed, the relevant portion of which reads as follows:- 8. We must at the outset, before dealing with the contempt application mentioned against the answering Respondents, clarify that this order dated 22.12.2016 being passed by this Bench, it is not only relevant but also bounden duty of this Bench to put across as to what was the situation warranted this Bench to pass such an order on 22.12.2016. 9. It was recorded in the order itself that the petitioners counsel argued 90 minutes inter alia asking three interim relief ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts and there is no end to it. 17. At this juncture, it is relevant to notice that under Section 422, 90 days' time is prescribed for Tribunal for expeditious disposal of a petition. Where appeal is not disposed of within the period of 90 days, the Tribunal is required to record the reasons for not disposing of the petition and the President may after taking into account reasons so recorded, may extend the period not exceeding 90 days. This means a Company Petition in any case is required to be disposed of at an early date. 18. In a number of cases which were listed recently before this Appellate Tribunal, it came to our notice that those cases are pending since 2013, onwards and have not been disposed of because of one or other interlocutory application(s) is filed by one or other party. 19. In Central Bank of India v. Vrajlal Kapurchand Gandhi, [2003] 6, SCC 573 the Hon'ble Supreme Court decided the remedy against conclusiveness and statement in judgment, if parties taking a different view. In the said case the Hon'ble Supreme Court referring the earlier decision in State of Maharashtra v. Ramdas Srinivas Nayak [1982] Vol.II, page 463 and Bhav Nagar Uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainst Rl Company not to take up issues to meet the requirements of the company or even about removal of Rll. When battle of senior counsel appear on either side, can it be assumed that one side directly agreed for consent order without even giving their reply submissions? 22. For the reason aforesaid no interference is called for against the order dated 18th January 2017 passed by the Tribunal, the appeal against the said order is dismissed. 23. From third impugned order dated 31st January 2017 it is clear that the Company Petition was posted for hearing of the main Company Petition pursuant to order dated 22nd December 2016 and subsequent issue raised in the affidavit filed pursuant to order dated 18th January 2017. On the said date arguments were advanced on behalf of the appellants over the interim relief. The Tribunal observed that the counsel for the petitioner had already argued over the interim relief on 16th January 2017 while arguing the Contempt Petition and it was made clear that the Bench will take a call over holding meeting on 6th February 2017, after completion of submissions over the main Company Petition which was scheduled to be taken on 31st January 2017. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Petition before hearing main petition, then the question of hearing on waiver would arise. No such objection has either been raised by this Bench or from the Respondents' side. 11. It is settled proposition of law that a party can raise maintainability at any point of time, therefore, it is the discretion of the Court to decide whether the maintainability point is to be decided at threshold or along with the main Company Petition. So when this Bench, itself is interested to hear the main company petition, this Bench is virtually perplexed of seeing the Petitioner Counsel stating that they will not argue the main Company Petition unless the waiver plea under proviso to Section 244 of the Companies Act 2013 is decided. 14. On reading para 24, 25 and 26 of the order above, it appears that though the Petitioner vehemently argued over this interim relief on EGM to be held on 6.2.2017 without any separate application, this bench having felt that this issue must be taken into consideration while hearing the main Company Petition, it has been held that the petitioners and Rll is given liberty to bring in this subsequent issue as part of hearing to main petition, accordi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng on the said date. Therefore, this Appellate Tribunal cannot make any comment about the conclusiveness of the facts so stated by the Tribunal which cannot contradicted by filing an affidavit before this Appellate Tribunal. What we can observe that some unfortunate situation took place may be of misunderstanding for which the case could not be taken up to decide any matter in one or other way. 27. In the aforesaid background, we are not inclined to interfere with the impugned order dated 31st January 2017. 28. Learned counsel for the appellants also requested to pass an interim order restraining the respondents from holding EGM on 6th February 2017. This prayer is opposed by learned counsel for the 1st respondent. 29. According to the appellants the action on the part of the respondents to hold EGM on 6th February 2017 for removal of 11th respondent is against the interim order passed on 22nd December 2016. A specific undertaking was given by the respondents that they will not take any action and such undertaking amounts to maintenance of status quo until final hearing or the Company Petition. 30. It is contended that apart from the 'oppression and mismanagement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shareholders. 36. In the Company Petition one of the substantive prayer (Prayer 'F') has been made to direct the 1st respondent and/or 2nd to 10th and 12th to 22nd respondents not to remove 11th respondent as a director from the Board of Directors of Respondent No. 1. This is also one of the interim relief. 37. Since the very beginning for one or other reason, the Tribunal has not passed any interim order of stay. It also observed that the Tribunal was not inclined to stay the EGM. 38. In these appeals we are not deliberating the question as to whether prima facie case has been made out or not, as no such argument was advanced nor deliberated by the Tribunal. The question of maintainability of the Company Petition is also pending. In this background while we are not inclined to pass any interim order, observe that if EGM is held on 6th February 2017 and the 11th respondent is removed, it is always open to the Tribunal to restore the status quo ante, if 'oppression and mismanagement' of 1st respondent company comes to the notice of the Tribunal. 39. In Life Insurance Corporation of India v. Escorts Limited and Others [1986] 1 SCC cases page 264 , Hon' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or in the interest of the company, if a prima facie case of 'oppression and mismanagement' is noticed. However, in view of the fact that in the present case as the appellants have raised the question of maintainability which is yet to be determined and their waiver application is pending we are not inclined to pass any interim relief at this stage. 41. In so far preliminary issue of maintainability is concerned, if the court after hearing hold the petition not maintainable, the Tribunal in such case is required to decide the question of waiver of the conditions set out under Section 244 of Act 2013 before the decision on merit. In National Council for Cement and Building Materials v. State of Haryana [1996] 3 SCC page 206 , the Hon'ble Supreme Court held as follows:- 15. In D.P. Maheshwari v. Delhi Admn. this Court speaking through O. Chinnappa Reddy, J. observed that the policy to decide the preliminary issue required a reversal in view of the unhealthy and injudicious practices resorted to for unduly delaying the adjudication of industrial disputes for the resolution of which an informal forum and simple procedure were devised with avowed object of keeping ..... X X X X Extracts X X X X X X X X Extracts X X X X
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