NCLT Kochi Rejects Plea To Implead CBI In Corporate Petition Alleging Oppression And Mismanagement

The Kochi Bench of the National Company Law Tribunal (NCLT) on 6 February dismissed an application by MRPN Minority Share Holder Customer Welfare Association, seeking to implead the Central Bureau of Investigation (CBI) in a pending company petition against Mary Rani Popular Nidhi Ltd. under Sections 241 and 242 of the Companies Act, 2013. The application alleged key managerial persons of the company of oppression and mismanagement.

The Bench comprising Judicial Member Shri Vinay Goel, held that impleading an investigating agency while a probe is ongoing is neither necessary for adjudicating corporate governance disputes nor conducive to the administration of justice.

He observed:

“Further, impleadment of an investigating agency at a stage when the investigation is ongoing is neither necessary for effective adjudication of the issues involved under Sections 241–242 nor conducive to the administration of justice. Such impleadment may give rise to procedural complications, prejudice the ongoing investigation, and blur the distinction between criminal investigation and civil adjudication.”

The Association alleged several key persons of the company of siphoning and embezzlement of company funds. During the pendency of the proceedings, it filed an interlocutory application seeking to implead the CBI as a respondent, noting that the agency was already investigating the company pursuant to directions issued by the Kerala High Court.

Rejecting the plea, the Tribunal held that the High Court had directed a time-bound CBI probe into certain matters concerning the company. However, it emphasised that the scope and supervision of such investigations fall exclusively within the domain of the investigating agency and the competent court.

It clarified that disputes under Sections 241–242 concern corporate governance and can be adjudicated inter se between the company and its stakeholders without involving the investigating agency.

The Tribunal further observed that the applicant failed to demonstrate how impleadment of the CBI would be relevant to the adjudication or satisfy the test of a necessary and proper party. It held:

“The role of the CBI is confined to investigation in accordance with law, and the findings, if any, may subsequently be placed before competent forums as and when finalised. The Applicant has not demonstrated how the presence of the CBI as a party respondent is indispensable for adjudication of the reliefs sought in the main petition. The disputes raised in the present proceedings can be adjudicated inter se between the parties to the company without requiring the investigating agency to be impleaded.”

The Tribunal held that any direction compelling the CBI to participate in the corporate dispute could amount to unwarranted interference with a High Court-ordered investigation. It cautioned that allowing impleadment while the investigation is ongoing could prejudice the probe and create procedural complications.

Importantly, Mr. Goel clarified that if any report or material arising from the CBI investigation becomes relevant at a later stage, the applicant would be free to seek appropriate relief in accordance with law and subject to the orders of the competent authority supervising the investigation.

Accordingly, the NCLT dismissed the application.