NCLT Finds Jawed Akhter's Conduct Oppressive, Structures Exit From Jawed Habib Hair and Beauty
The National Company Law Tribunal (NCLT) at Mumbai has held that acts of financial mismanagement by promoter Jawed Akhter amounted to oppression under the Companies Act, while also finding that attempts by the RBPL group to alter the board structure of Jawed Habib Hair and Beauty Ltd were similarly oppressive.
While finding JA's conduct prejudicial to the company's interests, a bench of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar observed:
“We have found the acts of JA in relation to alleged financial mismanagement to be oppressive and prejudicial to the interest of company as well its shareholders. Further, the acts of RBPL in relation to changes in the composition of board of the company at their behest are also oppressive to PD and JA.”
Observing that mutual distrust had made joint management unworkable, the tribunal structured an exit mechanism enabling the JA group and Greenfield Investments to exit the company, with RBPL taking effective control.
Jawed Habib Hair and Beauty operate over 900 salon franchises and more than 80 academies across India. The company's shareholding is divided among the JA group, the RBPL group, and Greenfield Investments-2 (GI).
RBPL, which acquired shares from Sampurna Maitra and BCCL and claimed majority control, alleged financial mismanagement by JA, including cash withdrawals, non-deposit of collections, including cash withdrawals, non-deposit of collections despite tribunal directions dated August 7, 2024, outstanding receivables and contravention relating to loans.
Akhtar in turn challenged RBPL's share acquisitions as violative of the Right of First Refusal (ROFR) under earlier agreements and opposed changes to board composition.
The tribunal noted that JA had withdrawn Rs. 1.71 crore between December 2024 and March 2025, partly to fund a proposed buyout of RBPL shares, in contravention of the company's Article 26 of the Articles of Association prohibiting financial assistance for purchase of company shares. It also recorded non compliance with earlier directions regarding deposit of excess cash collections.
At the same time, the bench found that RBPL acted oppressively by attempting to alter board control beyond what was permitted under the existing Articles of Association and Tribunal orders dated July 4 and July 15, 2025, which had structured board representation in a 2:1:3 ratio among JA, GI, and RBPL. The tribunal said:
“Indubitably, the AoA has still not been amended and the AoA amended to incorporate the understanding amongst JA, GI and Saksham in still in force. Also, RBPL, JA and GI had not entered into shareholder agreement amongst themselves after acquisition of shares from BCCL and Saksham by RBPL.”
Concluding that “mutual distrust” made continued joint management unworkable but that winding up would prejudice stakeholders, the tribunal structured an exit mechanism primarily to enable the JA group and Greenfield Investments to exit Jawed Habib Hair and Beauty, with the RBPL group taking effective control.
The exit contemplates a buyout at Rs 33 per share, subject to adjustments for loans, cash withdrawals and changes in net current assets, while directing refund of excess cash and compliance measures.
For Applicant: Advocates Sanjay Gupta, Aditi Bhatt, Deeksha Jani, Agam Maloo, Rohit Gupta, Aditya Bapat, Saroj Jadhav
For Respondents: Advocates Umang Thakar, Aditya Bapat, Saroj Jadhav, Shubhi Dotiya, Sanjay Kumar Gupta, Prakhar Tandon, CS Sanjay Kumar