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(2024) Law Today Live Doc. Id. 18925
Decided on: 02.02.2024
For Petitioner(s):
Ms. Aparajita Singh, Sr. Adv., Mr. Aditya Bharat Manubarwala, Adv., Ms. Prachi Johri, Adv., Mrs. Sarvagnya P Trivedi, Adv., Mrs. Akriti A Manubarwala, Adv., Ms. Tanishka Grover, Adv., Mr. Surya Kanta Parhi, Adv., Mr. Hitesh Kr Sharma, Adv.,Mr. Bharat Thakorlal Manubarwala, AOR, Mr. Shubham Rajhans, Adv.
For Respondent(s):
Mr. Abhimanyu Bhandari, Adv., Mr. Rajiv Kumar Virmani, AOR, Mr. Arjun Agarwal, Adv., Mr. Naman Saraswat, Adv., Mr. Arav Pandit, Adv.
Constitution of India, Article 227 -- Companies Act, 2013 (No. 18 of 2013), Section 241, 242 -- Oppression and mismanagement -- Company Petition – Maintainability of -- Objections were heard by the NCLT and the judgment was reserved -- At this stage, the first respondent moved the High Court in its jurisdiction under Article 227 of the Constitution – Held, High Court was not justified in entertaining a writ petition at the stage -- High Court ought not to have impeded the process of the NCLT pronouncing the judgment -- Thereafter, if any of the parties was aggrieved by the order of the NCLT, it was open to them to pursue their rights and remedies in accordance with law -- Invocation of the jurisdiction under Article 227 of the Constitution was not warranted.
(Para 1-7)
ORDER
1. A Company Petition1 [1CP No 44 of 2022] has been filed before the National Company Law Tribunal2 [2“NCLT”] by the first respondent claiming oppression and mismanagement. The petitioner challenged the maintainability of the Company Petition. The objections were heard by the NCLT and the judgment was reserved on 13 March 2023.
2. At this stage, the first respondent moved the High Court in its jurisdiction under Article 227 of the Constitution seeking a direction, inter alia, that the judgment should not be pronounced by the NCLT.
3. The High Court by its impugned judgment dated 17 March 2023 issued notice and directed that judgment in IA No 71/CB/2022 should not be pronounced till the next date of hearing. The writ appeal against the order of the Single Judge has been dismissed on 22 August 2023 on the ground of delay.
4. The High Court was not justified in entertaining a writ petition under Article 227 of the Constitution at the stage when arguments had been addressed on the IA filed by the petitioner, raising an objection to the maintainability of the main petition before the NCLT. The High Court ought not to have impeded the process of the NCLT pronouncing the judgment. Thereafter, if any of the parties was aggrieved by the order of the NCLT, it was open to them to pursue their rights and remedies in accordance with law.
5. Ms Aparajita Singh, senior counsel appearing on behalf of the petitioner has submitted that after this Court issued notice on 12 January 2024 and stayed the operation of the interim directions contained in paragraph 3 of the Single Judge’s order dated 17 March 2023 in IA No 3616 of 2023, the first respondent has, in fact, moved the NCLAT.
6. Mr Abhimanyu Bhandari, counsel appearing on behalf of the respondent, on the other hand, submits that though the first respondent has moved the NCLAT, the proceedings are lying in objection in the Registry.
7. Be that as it may, we are clearly of the view that the invocation of the jurisdiction under Article 227 of the Constitution was not warranted. We accordingly issue the following directions:
(i) The writ petition instituted by the first respondent under Article 227 of the Constitution, namely, WP (C) No 8079 of 2023, shall stand dismissed;
(ii) The NCLT would be at liberty to proceed to pronounce the judgment on the objections which have been raised to the maintainability of the main petition for oppression and mismanagement;
(iii) Since it appears that one of the Members of the Bench has since been transferred, the NCLT shall act in accordance with the administrative arrangements which are in place to deal with such an eventuality; and
(iv) In the event, that any of the parties are aggrieved by the order which may be passed by the NCLT, it would be open to them to pursue their rights and remedies in accordance with law.
8. This Court has not expressed any opinion on the merits of the rival contentions in the dispute before the NCLT.
9. The Special Leave Petitions are accordingly disposed of.
10. Pending applications, if any, stand disposed of.
Order accordingly.
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