Apc Credit Rating Pvt. Ltd vs Roc, Nct Of Delhi & Haryana

19.07.2017 The appellant having violated different provisions of the

Companies Act, 1956 filed two separate petitions under Section 441 of the

Companies Act, 2013 for compounding the offence(s). The Tribunal vide

two separate orders both dated 26th September, 2016 dismissed the

petitions for the reasons mentioned therein. Thereafter, the appellant

preferred two separate applications under Rule 154 of the National

Company Law Tribunal Rules, 20 16(hereinafter referred to as 'Rule, 2016)

for review of both the orders dated 26th September, 2016 on the grounds

that there are omissions the Tribunal having not taken into consideration

the judgment of the National Company Law Appellate Tribunal (hereinafter •referred to as "Appellate Tribunal") dated 28th February, 2016 in MIs. Viavi

Solutions India Private Limited & others vs. Registrar of Companies,

NCT Delhi and Haryana - Company Appeal (AT) 49 etc. of 2016

whereunder the Appellate Tribunal laid down the factors to be taken into

consideration for compounding the offences. The Tribunal by two different

impugned orders, both dated 28th April, 2017 while holding that the review

cannot be confused with the appeal wherein one order can be replaced by

another, further held that the imposition of compounding fee was

considered as per judicial discretion of the Tribunal, taking into

consideration of long period of defaults and dismissed both the review

applications.

2. Faced with the aforesaid situation, in these appeals, the appellant

has challenged both the orders dated 28th April, 2017 passed in review

applications and the original order, dated 26th September, 2016. However,

we find that the appellant has deposited lesser fee. I However, on the

assurance made on behalf of the appellant that appellant will deposit

further fee of Rs.5,000/- within 15 days, we heard the Appeal.

3. In these appeals, one of the question arises is whether National

Company Law Tribunal (hereinafter referred to as 'Tribunal') had the

jurisdiction to review its order passed in a petition under Section 441 of

the Companies Act, 2013.

4. The Companies Act, 2013, do not empower the Tribunal to review its

own order and judgment. Under sub-Section (2) of Section 420, the

Tribunal has been empowered to act any time within two years from the date of the order, with a view to rectify,any mistake apparent from the

record, amend any order passed by it and to make such amendment, if a

mistake is brought to its notice by the parties, which reads as follows

"420. Orders of Tribunal.--

"(1) The Tribunal may, after giving the parties to any

proceeding before it, a reasonable opportunity of

being heard, pass such orders thereon as it thinks

fit.

(2) The Tribunal may, at any time within two years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it, and shall make such amendment, if the mistake is brought to its notice by the parties:

Provided that no such amendment shall be made in respect of any order against which an appeal has been preferred under this Act.

(3) The Tribunal shall send a copy of every order

passed under this section to all the parties

concerned."

5. The Tribunal has inherent power under Rule 11 of NCLT Rules,

2016, in terms of which the Tribunal may make such orders as may be

3 necessary for meeting the ends of justice or to prevent abuse of the process

of the Tribunal, as quoted below:

"11. Inherent powers,.-

owers.-

Noting in these rules shall be deemed to limit or otherwise affect the inherent powers of the Tribunal to make such orders or give such directions as may be necessary for meeting the ends of justice or to prevent abuse of the process of the Appellate Tribunal."

6. Rule 154 of NCLT Rules, 2016, empowers the Tribunal to rectify its

order, if there is any clerical or arithmetical mistake in the order of the

Tribunal or error therein arises from any accidental slip or omission of its

own motion or an application of any party by way of rectification, as quoted

below:

"154. Rectification of Order.-

(1) Any clerical or arithmetical mistakes in any order of the Tribunal or error therein arising from any accidental slip or omission may, at any time, be corrected by the Tribunal on its own motion or on application of any party by way of rectification.

(2) An application under sub-Rule (1) may be made in Form No. NCLT. 9 within two years from the date of the final order for rectification of the final order not being an interlocutory order."

7. The Tribunal has general power to amend within the period of 30

days from the date of completion of the pleadings, any defect or error in its

proceeding before it but if the same relates to determination of the real

question or issue raised or depending on such proceeding, as shown below:

"155. General power to amend.-

The Tribunal may, within a period of thirty days from the date of completion of pleadings, and on such terms as to costs or otherwise, as it may think fit, amend any defect or error in any proceeding before it; and all necessary amendments shall be made for the purpose of determining the real question or issue raised by or depending on such proceeding."

8. From the aforesaid provisions, it is clear that there is no inherent

power to review, as is under Order 47 Rule 11 of the Code of Civil

• Procedure, 1908 but the Tribunal has power conferred by sub-section (2)

of Section 420 of the Act, 2013 to rectify any mistake apparent from the

record and to amend the order accordingly.

9. The present case of the appellant do not fall within the meaning of

'mistake apparent on the face of the record' of appellant and therefore,

there was no occasion for Tribunal to exercise power conferred by sub-

section (2) of Section 420 of Act, 2013.

10. The inherent power, as provided under Rule 11, is for making such

order for meeting the ends of justice or to preventing abuse of justice, or if

necessary for meeting the end of justice or abuse of process of Tribunal. But such power can be exercised during hearing of an application/ appeal

and not after disposal or for review of its own order.

11. The appellant(s) filed the petition under Rule 154, which relates to

rectification of order, if there is clerical or arithmetical mistakes in the

order or error arising from any accidental slip or omission, as may occur.

But such power cannot be exercised to review an order or judgment, in

absence of clerical or arithmetical mistakes.

12. We do not agree with the submission made on behalf of the counsel

for the appellant that non-reference to any one or other judgment passed

by the Appellate Tribunal or any court of law falls within the category of

"omission" by the Tribunal. For the purpose of rectification of any order

under Rule 154, the omission must be such, which should be related to

the case. In absence of any evidence to show that a judgment of Appellate

Tribunal or Court was referred, it cannot be accepted to be an "omission"

by Tribunal. Further no Court or Tribunal is bound to refer all or any

judgment cited by anyone or other party, whether relevant or irrelevant.

13. For the reasons aforesaid and as the Tribunal has no general power

to review its own order or judgment, we uphold the impugned orders dated

24th April, 2017 passed by Tribunal.

14. In so far as the original orders both dated 26th September, 2016 is

concerned, we are not inclined to decide the case on merit in respect to the

aforesaid orders, which are reached finality in view of Section 421 of the

Companies Act, as quoted below:

"421. Appeal from orders of Tribunal.--

(1) Any person aggrieved by an order of the Tribunal may prefer an appeal to the Appellate Tribunal. (2) No appeal shall lie to the Appellate Tribunal from an order made by the Tribunal with the consent of parties. (3) Every appeal under sub-section (1) shall be filed within a period offorty-five days from the date on which a copy of the order of the Tribunal is made available to the person aggrieved and shall be in such form, and accompanied by such fees, as may be prescribed:

Provided that the Appellate Tribunal may entertain an appeal after the expiry of the said period of forty-five days from the date aforesaid, but within a furt her period not exceeding forty-five days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within that period.

(4) On the receipt of an appeal under sub-section (1), the Appellate Tribunal shall, after giving the parties to the appeal a reasonable opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order appealed against. (5) The Appellate Tribunal shall send a copy of every order made by it to the Tribunal and the parties to appeal."

15. As per sub-section (3) of Section 421, every appeal is required to be

filed under sub-Section (1) within 45 days from the date on which the copy

of the order of the Tribunal is made -available to the person aggrieved; As

the Appellate Tribunal is empowered to entertain an appeal after expiry of

7 the said period of 45 days from the date of receipt of the order but such

power can be exercised only within a further period not exceeding 45 days

that is total 90 days. If order(s) dated 26th September,. 2.016 were

communicated the appellant(s) in October, 2016 [actual date not supplied

by the appellant(s)], even then, we find that now more than 9 /2 months

have passed and thereby the Appellate Tribunal has no power to condone

the delay. For the said results, we express our inability to interfere with

the impugned orders both dated 26th September, 2016 and reject such

prayer.

16. We find no merit in these appeals. They are accordingly

dismissed. However, in the facts and circumstances, there shall be no

order as to cost.

[Justice S.J. Mukhopadhaya] Chairperson

[Balvinder Singh] Member (Technical)