NCLAT New Delhi Restores Status Quo Over Company Assets Pending Share Valuation And Buyback
The New Delhi National Company Law Appellate Tribunal (NCLAT) on 18 August directed that status quo be maintained in a family dispute over Rukshmani Syntex Pvt. Ltd. until valuation of the appellant's shares is completed.
A Bench comprising Judicial Member Justice Sharad Kumar Sharma and Technical Member Indevar Pandey disposed of an appeal filed by Mehul Narayan Thakkar against an order of the Mumbai National Company Law Tribunal (NCLT) and directed the NCLT to appoint a valuer and obtain a valuation report expeditiously. It observed:
“This appellate Tribunal has granted a status quo order on 27.03.2026 and owing to the fact that the appellant petitioner had offered a buyback of share in respondent no.1. The respondents much controversy was not left to be decided on merits”
Thakkar had filed a petition under Sections 241, 242 and 246 of the Companies Act, 2013, alleging oppression and mismanagement by his elder brother, Vikram Narayan Thakkar, and father, Narayan Dalpatram Thakkar.
He alleged that the irregular appointment of his father as a director, seizure of the company's financial and banking control by his brother and father, his exclusion from the company's affairs, obstruction of his functioning at the factory, removal as whole-time director and termination of his employment constituted acts of oppression. Further, that extraction of money from the company, sale and disposal of its assets, mismanagement of production and oppressive planning amounted to acts of mismanagement.
Thakkar held 45,993 equity shares, constituting 37.09% of the company's paid-up capital. His brother held an equal stake, while his father had a negligible shareholding. He sought, among other reliefs, restoration of joint management and, alternatively, a buyback of his shares at a fair value determined by an independent valuer.
On 5 March 2026, the NCLT directed the parties to maintain status quo after the respondents conceded to Thakkar's request. However, on 9 March 2026, it vacated the interim order after noting that the respondents had agreed to consider buying back Thakkar's shares. It also directed both sides to suggest names of valuers and clarified that distribution of assets could proceed in accordance with law after valuation was completed.
Aggrieved by the vacation of the status quo order before valuation, Thakkar approached the NCLAT, contending that the respondents were proceeding to dispose of company assets without appointment of a valuer.
On 27 March 2026, the NCLAT restored the status quo after noting that a valuer had not yet been appointed and the issue was pending before the NCLT. It noted that the dispute had narrowed to the buyback of Thakkar's shares and that the NCLT's 9 March order was essentially consensual, as both sides had agreed to consider the buyback and appoint a valuer.
The Tribunal held that Thakkar's grievance was confined to the premature vacation of the status quo order. Since names of valuers had already been suggested, the matter remained pending valuation.
Accordingly, the NCLAT directed that the status quo order passed by the NCLT on 5 March 2026 and revived by the NCLAT on 27 March 2026 would continue until the valuation was completed and acted upon. It also directed the NCLT to appoint a valuer, obtain the valuation report expeditiously and have the buyback offer decided independently on the basis of the valuation report.
For Appellant: Mr. Bishwajit Dubey with Mr. Anuj Tiwari, Mr. Shivendra Nath Mishra, Mr. Vaibhav Vats, and Mr. Sameer Mishra Advocates.
For Respondents: Mr. Krishnendu Datta and Mr. Gaurav Mitra, Sr. Advocates Mr. Utsav Trivedi, Mr. Sohan Kinkhabwala, Ms. Aditi Prabhu, Mr. Kashual Parsekar, Ms. Shivani Bhushan, Mr. Yash Tandon, Ms. Lavanya and Mr. Gaurav Sharma, Advocates.