COMPANY LAW
Removal As Director Did Not Bar Shareholder's Oppression Plea: NCLT Ahemedabad
The National Company Law Tribunal, Ahmedabad bench, held that a shareholder's right to seek relief under Section 241 of the Companies Act, 2013 for oppression and mismanagement was not extinguished by his removal as a director. However, while holding the petition to be maintainable, the tribunal ultimately dismissed a plea filed by Hardeep Singh Gill against Glulam Technologies Pvt. Ltd., finding no case of oppression or mismanagement. The bench of Judicial Member Shammi Khan and Technical...
Civil Courts Cannot Decide Shareholder Disputes Requiring Rectification Of Register: Bombay High Court
On 6 April, the Bombay High Court held that only the NCLT can decide disputes over shareholding or rectification of the register of members, and civil courts have no jurisdiction under Section 430 of the Companies Act, 2013. A Bench of Justice R.I. Chagla heard Notices of Motion in a suit filed by the son and ex-wife of a deceased shareholder of Panache Securities Pvt Ltd, who alleged that individuals claiming to act on behalf of the company fraudulently transferred shares, removed a director,...
Compromise Schemes Are Consensual, Class-Based; No Omnibus Liability Extinguishment: NCLT Hyderabad
The National Company Law Tribunal (NCLT) at Hyderabad has rejected a debt restructuring scheme proposed under Section 230 of the Companies Act during the liquidation of Sarda Agro Oils Ltd, holding that such schemes, in effect, cannot be used to grant a blanket “clean slate” by extinguishing liabilities. A bench of Judicial Member Rajeev Bhardwaj and Technical Member Sanjay Puri clarified that a scheme under Section 230 is inherently consensual and class-based, binding only identified...
Breakdown Of Trust: NCLT Mumbai Orders Buyout In Family Dispute Over Stake In R.K. Paper, Jai Kaushal Industries
The National Company Law Tribunal (NCLT) at Mumbai has ordered a buyout in a family-run company dispute, holding that a breakdown of trust in a quasi-partnership justified an exit instead of winding up. A bench of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar, in its order dated April 7, observed, “There is a breakdown of trust and confidence amongst Petitioner group on one side and the Surendra Group, Jatindra Group and Sushil Group on the other side,” while...
NCLT Mumbai Dismisses Plea By Former Director R.C. Bawa's Wife, Daughter To Be Removed From IL&FS Proceedings
The National Company Law Tribunal at Mumbai has dismissed a plea filed by Asha Kiran Bawa and Akansha Bawa in the IL&FS proceedings, holding that they continue to be necessary parties in the Union of India's petition alleging oppression and mismanagement and large-scale financial irregularities in the company. R.C. Bawa, a former director of IFIN (IL&FS Financial Services Ltd), is the husband of Asha Kiran Bawa and the father of Akansha Bawa. A bench of Judicial Member Sushil...
Wrong Excel Upload Administrative, Not Substantive Revision Under Section 131 Companies Act: NCLT Delhi
The New Delhi Bench of the National Company Law Tribunal (NCLT) on 11 March, held that the company's error in uploading an incorrect Excel file while filing Form AOC‑4 XBRL was a clerical mistake amounting to an administrative issue, not a substantive revision under Section 131.A Bench comprising Judicial Member Mahendra Khandelwal and Technical Member Anu Jagmohan Singh dismissed a petition by P & R Infraprojects Limited seeking approval to revise its financial statements for FY...
NCLAT Chennai Holds Share Purchase Rights Forfeited By Delay In Exercising First Option
The National Company Law Appellate Tribunal (NCLAT) at Chennai on 26 February dismissed an appeal by PM Johny challenging an NCLT order that permitted respondents to purchase shares at a higher valuation, holding that the appellant forfeited the right by failing to act at the appropriate stage. A Bench comprising Judicial Member Justice Sharad Kumar Sharma and Technical Member Jatindranath Swain observed: “…the Appellant cannot take an advantage at this stage by carving arguments when the...
NCLT Mumbai Directs Stakeholder Meetings In Merger Of Mandawewala Enterprises With AYM Syntex
On 6 April, the National Company Law Tribunal (NCLT) at Mumbai allowed the first motion application to merge Mandawewala Enterprises Ltd into AYM Syntex Limited and directed the convening of stakeholder meetings. A Bench comprising Judicial Member K.R. Saji Kumar and Technical Member Anil Raj Chellan approved the first motion under Sections 230–232 of the Companies Act. The Tribunal directed: “In view of the facts submitted hereinabove, this Bench directs the convening of the meeting of the...
NCLT Mumbai Approves Nirmal Lifestyle Realty–Oberoi Realty Merger
The National Company Law Tribunal (NCLT) Mumbai on Monday approved the scheme of amalgamation between Nirmal Lifestyle Realty Pvt Ltd and Oberoi Realty Ltd., allowing the merger and granting consequential directions. A bench comprising Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar held that the scheme was fair, reasonable, and not contrary to law or public policy, noting that no objections were received from stakeholders or regulatory authorities. The scheme,...
NCLT Mumbai Clears First Motion For Merger of Jaypore, TG Apparel Into Aditya Birla Fashion
The National Company Law Tribunal's Mumbai Bench on Monday allowed a first motion application in a scheme of amalgamation between Jaypore E-Commerce Pvt Ltd and TG Apparel and Decor Pvt Ltd with Aditya Birla Fashion and Retail Limited, dispensing with meetings of shareholders and creditors in specified cases. A bench of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar passed the order under Sections 230 to 232 of the Companies Act. The appointed date for the scheme...
Only NCLT Can Decide Premature Loan Repayment Disputes Under RBI Act: Allahabad High Court
The Allahabad High Court on 31 March held that under Section 45QA of the Reserve Bank of India Act, 1934 read with Section 430 of the Companies Act, 2013, only the National Company Law Tribunal (NCLT) has the jurisdiction to decide disputes regarding premature repayment of a loan. A Single-Judge Bench of Justice Sandeep Jain dismissed the appeal filed by Shivam Traders And Hire Purchase Pvt. Ltd. against Madhusudan Vehicles Pvt. Ltd., holding that the civil court had no jurisdiction over...
NCLT Chennai Allows First Motion In Apollo Hospitals Scheme, Orders Stakeholder Meetings
The National Company Law Tribunal (NCLT) at Chennai has recently directed meetings of equity shareholders as well as secured and unsecured creditors, while dispensing with such meetings in certain cases, in a composite scheme of arrangement involving Apollo group companies. A coram of Judicial Member Jyoti Kumar Tripathi and Technical Member Ravichandran Ramasamy was dealing with a joint application filed by Apollo Hospitals Enterprise Limited, Apollo Healthco Limited, Keimed Private Limited,...