Bhavna Sanjay Mistry vs Jupiter Comtex Pvt. Ltd. & Ors & Ors

IN THE MATTER OF: Jupiter Comtex Pvt. Ltd. & Ors. ...Applicants/ Appellants Versus Bhavna Sanjay Mistry & Ors. ...Respondents Present: For Appellant : Mr. Krishnendu Datta, Sr. Advocate with Mr. Karan Valecha, Ms. Shivangi Khandelwal, Ms. Alina Merin Mathew, Advocates for A1 to A6.

Mr. Vaibhav Gaggar (Sr. Adv.), Mr. Arjun Sheth, Mr. Ketan S., Ms. Noopur K. Dalal, Advocates for A1 to A9.

Mr. Vansh Srivastava, Advocates.

For Respondents : Mr. Gaurav Mitra, Sr. Advocate with Ms. Natasha Dhrumanshah, Mr. Aniruddha Deshmukh, Ms. Aishwarya Seth, Advocates. With I.A. No. 6537 of 2026 In Company Appeal (AT) No. 340 of 2026

IN THE MATTER OF: Bhavna Sanjay Mistry ...Applicant/ Appellant Versus Jupiter Comtex Pvt. Ltd. & Ors. ...Respondents Present: For Appellant : Mr. Gaurav Mitra, Sr. Advocate with Ms. Natasha Dhrumanshah, Mr. Aniruddha Deshmukh, Ms. Aishwarya Seth, Advocates.

For Respondents : Mr. Krishnendu Datta (Sr. Adv.), Mr Karan Valecha, Ms. Shivangi Khandelwal, Ms. Alina Merin Mathew, Advocates for R1 to R6.

Mr. Vaibhav Gaggar (Sr. Adv.), Mr. Arjun Sheth, Mr. Ketan S., Ms. Noopur K. Dalal, Advocates for R1 to R9.

ORDER

Per Justice Sharad Kumar Sharma, Member (Judicial)

1. This Order, would be covering the Orders, to be passed on I.A. No.

6189 of 2026 in Comp. App. (AT) No. 329 of 2026and I.A. No. 6537 of

2026 in Comp. App. (AT) No. 340 of 2026.

2. The proceedings, under Sections 241 and 242 of the Companies Act,

2013, stood initiated at the behest of Bhavna Sanjay Mistry, in an

adjudication that has taken place on 06.07.2026 by the learned NCLT

Ahmedabad in CP No. 29(AHM)/2021. Whereby, the Company Petition has

been decided with the following directions:-

"62. Accordingly, the following directions are issued:

I. It is declared that the conduct of Respondent Nos.2 to 4 in the affairs of Respondent No.1 Company amounts to oppression within the meaning of Section 241 of the Companies Act, 2013. The Respondent No.1 is also being mismanaged.

II. Respondent Nos. 2 to 4 shall jointly and severally purchase the entire shareholding of the Petitioner in Respondent No. 1 Company at the fair value determined by Mr. Dharmendra Dhelariya (IBBI Registration No. IBBI/RV /06/2019 / 11555), Independent Registered Valuer appointed by this Tribunal vide order dated 11.12.2024, in his valuation report dated 28.03.2025, (which is accepted by this Tribunal as being fair and reasonable for the purposes of granting relief under Section 242 of the Companies Act, 2013) as on

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

2 of 20 31.03.2023, or at such a value as may be mutually agreed between the parties within a period of Ninety (90) days from the date of this order.

III.Immediately upon receipt of the entire sale consideration, the Petitioner shall execute all necessary share transfer deeds, instruments and other documents required for transferring her shareholding in favour of Respondent Nos. 2 to 4, and Respondent No. 1 Company shall record and give effect to such transfer in its statutory records in accordance with law. This process should also be completed within 90 days from the date of this order.

IV.Upon completion of the aforesaid transfer, the Petitioner shall cease to have any rights, title, interest and all incidental shareholder rights in the shareholding of Respondent No. 1 Company, without prejudice to the rights and obligations arising under this order.

V. However, in case the share sale as contemplated in Clauses II and III does not take place within the stipulated period of ninety (90) days, whether on the valuation determined by the Independent Registered Valuer or at such mutually agreed value between the parties, Respondent No. 2, Mr. Gitesh Mistry, shall stand removed and cease to hold office as Director of Respondent No. 1 Company upon expiry of the aforesaid period if the buy-out is not completed in exercise of the powers of this Tribunal under Section 242(2)(h) of the Companies Act, 2013. VI.The Petitioner shall, within thirty (30) days thereafter, communicate to Respondent No. 1 Company the name of her nominee for appointment as Director. Upon receipt of such communication, Respondent No. 1 Company through Board of Directors shall appoint the Petitioner's nominee as Director in exercise of the powers conferred under Section 242(1) read with Section 242(2)(h), (k) and

(m) of the Companies Act, 2013, and give effect to such appointment within thirty (30) days thereafter. VII. Further, in case the share sale as contemplated in Clauses II and III does not take place, the profits

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

3 of 20 earned by Respondent No.7 for Financial Years 2017-2018 to 2019-2020 be deemed to be the profits of the Respondent No.1 for the respective years. The Respondent Nos. 2 to 4 & 7 shall restore the same to Respondent No.1 within thirty (30) days.

VIII. All other prayers, including those seeking appointment of an Administrator, appointment of forensic or Independent auditors and other consequential reliefs, stand rejected.

IX. Subject to the directions contained herein, all remaining reliefs sought in the Company Petition stand rejected.

63. In the event of failure on the part of Respondent Nos. 2 to 4, 7 or Respondent No. 1 Company to comply with any of the directions contained in this order within the stipulated time, the Petitioner shall be at liberty to approach this Tribunal by filing an appropriate application seeking implementation, execution or enforcement of this order in accordance with law.

64. Accordingly, Company Petition No. 29 of 2021 stands partly allowed and disposed of in the aforesaid terms.

65. All pending Interlocutory Applications, if any, stand disposed of accordingly. There shall be no order as to costs."

3. Both, the Petitioner, Bhavna Sanjay Mistry, and the Appellant herein,

i.e., Jupiter Comtex Pvt. Ltd., who was an opposite party to the proceedings

of the Company Petition, have expressed their disagreement with the

Impugned Order dated 06.07.2026, and, hence, are before us.

4. The Company Petition was initiated by Bhavna Sanjay Mistry, wherein

she sought a relief of declaration to the effect that, the conduct of

Respondent Nos. 2 to 4 in CP, i.e., Gitesh Jayantilal Mistry, Jatin Jayantilal

Mistry and Rakesh Giteshkumar Mistry, who were the Directors of

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

4 of 20 Respondent No. 1 Company, amounted to be the acts of aberration and

malfunctioning in the internal management of the Company and there were

blatant acts falling within the domain of Sections 241 and 242, which itself

would be establishing intentional acts of oppression and mismanagement.

5. The Petitioner, Bhavna Sanjay Mistry, prayed for reconstitution of the

Board of Respondent No. 1 by excluding Respondent Nos. 2 to 4, along with

their conniving officers, agents, servants and representatives, and for

passing of an appropriate Order to have her representative in the form of

Directors, who was to be nominated by the Petitioner, as per the

arrangement since the incorporation of Respondent No. 1 Company.

6. The other ancillary relief that, was sought was for, was appointment of

an independent Auditor to inquire into the financial irregularities allegedly

committed by Respondent Nos. 2 to 4, for the period between 2010-11 to

2019-20 (which, has otherwise been argued by the Appellant in Comp. App.

(AT) No. 329 of 2026 to be 2024-2025) and to submit his report, so that a

buy-back proposal may be taken into consideration by the Petitioner,

Bhavna Sanjay Mistry, for purchasing the shares, based upon the actual

valuation report. The Petitioner also sought a direction for Respondent Nos.

2 to 4 to undo the illegal gains made by them, which had ultimately resulted

in unprecedented losses suffered by the Petitioner and Respondent No. 1

Company.

7. It is under these factual circumstances that, when the matter was

taken up in the context of the reliefs sought in the main Company Petition,

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

5 of 20 the Petitioner argued that she, Bhavna Sanjay Mistry, then held a

shareholding of 33.2%, as it stood reflected in the shareholding pattern

placed on record and had further substantiated by placing the copy of the

share certificate on record. It was further contended by the Petitioner,

Bhavna Sanjay Mistry, in her pleadings that Respondent Nos. 2 to 4, had

been persistently functioning in utter breach of their fiduciary relationships

and the trust reposed in them in the functioning of Respondent No. 1

Company, thereby resulting in multifarious losses.

8. She, in continuation submitted that M/s Jupiter Comtex Private

Limited, was incorporated in the year 2007 under the provisions of the

Companies Act, 1956, and was accordingly registered with the Registrar of

Companies, Ahmedabad. Prior to its incorporation, the business of the

Company was carried on through partnership firms, namely, Jupiter

Enterprises and Jupiter Engineering. It is argued that they were engaged in

the manufacturing of textile machinery, which was a business being

managed by the companies/partnership firms. However, owing to the

demise of one of the partners in 2001, these two entities were converted into

Jupiter Comtex Private Limited, which came into existence in 2007 to

facilitate the business expansion.

9. The Petitioner in the Company Petition submitted, that they had

control over the affairs and finances of the Respondent Company, though its

management remained under the control of Respondent Nos. 2 to 4 and

certain other members of the Mistry family, i.e., Saurin Gitesh Mistry, the

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

6 of 20 son of Respondent No. 2, who was engaged in the administration, though it

was a fact that he was not holding any official position, within the setup of

the Company.

10. Records reveal that in 2008, one of the founding members of

Respondent No. 1, namely Shri Sanjay Mistry, met with the said demise. It

is because of the said situation that, since the Respondent No. 1 was

functioning as a family-run quasi-partnership and the family members

continued to hold the shareholding and were participating in the

management of the Company. Hence, in terms of the understanding that,

was arrived at between the partners, the shares held by Shri Vishal Mistry

and Smt. Janki Vishal Mistry were shown to have been subscribed amongst

the family members.

11. However, because of the fact that, despite the demise of Mr. Sanjay

Mistry, the Petitioner contends that she was holding faith in Respondent

Nos. 2 to 4 to manage the affairs of Respondent No. 1, but the trust was

breached by Respondent Nos. 2 to 4, who were indulging themselves in the

act of oppression and mismanagement, including the siphoning and

diversion of funds. In the Petition, the Petitioner has come up with a case

that her son, who was employed with Respondent No. 1 Company, was

assured that he would be subsequently inducted as a Director on the Board.

However, it was pleaded by Petitioner, that later on, he was meted out with

discriminatory treatment and coercion at the hands of Respondent Nos. 2 to

4.

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

7 of 20

12. It is because of the aforesaid reasons, that the Company Petition was

preferred for the aforesaid relief, as it has been briefly stated in the

preceding paragraphs. When the breach persisted, the petitioner is shown to

have written a letter on 08.09.2020, requesting Respondent Company to

split the shares held by her. It was submitted that Respondent No. 1

Company, through Respondent No. 3, would be placing the issue before the

Board, for consideration regarding splitting of the shares and for carrying

out the Resolution for its adoption.

13. Thereafter, after the exchange of pleadings, the learned Tribunal

formulated three major issues for consideration to decide the controversy

inter se between the parties. Primarily, the issues, which were considered by

the learned Tribunal were to the effect:-

(1) The issue whether the conduct of Respondent Nos. 2 to 4, looking at it

from the perspective of the constitution of Respondent No. 1 Company, will

fall within the ambit of oppression and mismanagement under Sections 241

and 242 of the Companies Act;

(2) As to whether Respondent Nos. 2 to 4, who were at the helm of affairs of

Respondent No. 1 Company, had breached their fiduciary duties; and

(3) Whether the Petitioner is entitled to the relief sought under Section 242

of the Companies Act.

14. The learned counsel for the Appellant of Company Appeal (AT) No. 329

of 2026, primarily has drawn the attention of this Tribunal to the finding

that has been recorded in the Impugned Judgment, pertaining to the

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

8 of 20 manner in which the valuation report has been taken into consideration.

Particularly, he has made reference to the finding recorded in Para No. 59 of

the Judgment and argues the issue from the perspective that, as a matter of

fact, the valuer who was thus later appointed, i.e., Mr. Dharmendra

Dhelariya, and the report submitted by him on 28.03.2025 was nothing but

rather a replica of the earlier reports submitted by the earlier valuers, viz.

M/s Crest Valuation Services Private Limited, Mr. Pranav Parikh and Mr.

Shirish Sharma.

15. Respondent No. 1's case before us had been, that, because of the

earlier Order passed by the Tribunal on 07.12.2021, it is recorded in the

proceedings that exclusively a reply from Respondent No. 1, i.e., Jupiter

Comtex Private Limited, was received and by that time i.e., till 07.12.2021

no reply was received from Respondent Nos. 2 to 10, and hence, they were

directed to be proceeded ex-parte. Considering the response given by

Respondent No. 1 while contesting the proceedings, the Respondent No. 1

had contended that the institution of the Company Petition itself was a

gross abuse of process, having been instituted with a malafide intention, as

none of the ingredients contemplated to be satisfied under Sections 241 and

242 and Sections 58, 59, 210 and 213 of the Companies Act, 2013 were

made out and the Company Petition was liable to be dismissed.

16. Apart from pleading the aforesaid fact, the Respondent before the

learned Tribunal had submitted that there was no prima facie case

established to be brought within the ambit of the aforesaid provisions and,

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

9 of 20 thus, it deserved dismissal. It was argued that, rather the proceedings of the

Company Petition were nothing but an attempt to interfere in the smooth

functioning of the Company and to settle personal disputes under the guise

of minority shareholder rights.

17. They further denied the aspect pertaining to the allegation of diversion

of the funds and its business of the Respondent Company, as the

Respondent entities operate in a distinct line of business and they do not

compete with or prejudice the interest of Respondent No. 1 Company.

18. The said response of the Respondent was answered by the Petitioner

by filing a rejoinder on 07.06.2022.

19. When the proceedings were again taken up on 17.08.2022,

Respondent Nos. 2 to 10, who were earlier directed to be proceeded ex-parte

by an Order dated 07.12.2021, they had appeared through their counsel.

Respondent Nos. 4 to 6 appeared through their counsel and prayed for filing

of reply to the petition. The learned Tribunal observed that, since, by virtue

of the earlier Order passed on 17.01.2023, they had already been directed to

be proceeded ex-parte, the parties were permitted only to file their written

notes of submissions.

20. Similarly, by an Order dated 19.06.2023, the counsel for Respondents

were also directed to file their reply within two weeks. After the exchange of

pleadings, the learned Tribunal took up the matter for its final adjudication

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

10 of 20 and, upon considering the rival contentions and particularly in the context

of the pleadings raised by the parties, came to conclusion.

21. During the course of the proceedings of this Company Appeal, what

we could see from the findings recorded by the learned Tribunal was that,

on 08.02.2024, the parties recorded their submissions in order to bring an

end to the controversy by appointment of an independent valuer for the

purposes of carrying fresh valuation of the shares of Respondent No. 1

Company, or there was an additional request made that the Company may

be directed to buy back the shares of Respondent No. 1 Company, from the

Petitioners.

22. The learned Adjudicating Authority, with the consent of the counsel

for the parties, appointed M/s Crest Valuation Services Private Limited, a

registered valuer, to determine the fair value of shares of Respondent No. 1

Company, as it was existing between 31.03.2018 and 31.03.2023, and the

valuer was expected to give its report within a period of 35 days.

23. However, there was some distrust which was expressed with the

earlier valuer, who was appointed on 11.03.2024 because of the fact that

the Petitioner had filed I.A. No. 27 of 2024 under Rule 11 of the NCLAT

Rules, 2016 seeking modification of the earlier order of appointment of the

valuer dated 11.03.2024, on the ground that M/s Crest Valuation Services

Private Limited, which had been appointed as the valuer, had expressed its

inability to undertake the valuation and had proposed for a substitution of

the valuer.

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

11 of 20

24. Consequently, the learned Adjudicating Authority, vide its Order of

25.04.2024, while disposing of the said I.A. No. 27 of 2024 preferred by the

Petitioner, appointed Mr. Pranav Parikh (Land & Building), Mr. Shirish

Sharma (Plant & Machinery) and Mr. DharmendraDhelariya (Financial

Assets) as independent registered valuers to determine the actual face value

of shares of Respondent No. 1 Company as on 31.03.2018 and 31.03.2023.

25. The valuation report was submitted, and the Adjudicating Authority,

on 11.07.2024, took on record the valuation reports submitted before the

Tribunal, by the appointed valuers in respect of the financial assets,

movable assets and immovable assets of Respondent No. 1 Company.

Respondent No. 1 is shown to have contested the valuation reports as

aforesaid and had filed an affidavit dated 21.08.2024, raising objections

towards the contents of the valuation reports as submitted on 11.07.2024.

26. The Petitioners too filed their objections to the valuers' reports dated

11.07.2024. Since there was a massive rift between the parties as regards

the contents of the reports submitted by the valuers, it was observed that

the existing valuation reports demonstrated the acts of mismanagement,

siphoning of funds, diversion of business to sister concerns, including to

M/s Jupiter Machinery, and undervaluation of the Company's assets, which

ultimately caused prejudice to the interests of the Petitioners and the other

shareholders.

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

12 of 20

27. Since there had been a doubt pertaining to the valuers' reports as

submitted by the earlier valuers, the Tribunal, vide its order of 28.11.2024,

while recording the submissions of both the counsels as against the valuers'

reports and on the question of appointment of a new valuer to undertake a

fresh valuation of shares of Respondent No. 1 Company, accordingly

directed the parties to suggest a valuer.

28. In pursuance of the Order dated 28.11.2024, Respondent Nos. 1 to 9

filed a proposal, thereby proposing Mr. Darshil Shah, the registered valuer,

while the Petitioner also filed its request on 03.12.2024, proposing the name

of CA Dr. Anjali Nirav Choksi as a registered valuer. While considering the

aforesaid two proposals during the course of hearing that was held on

05.12.2024, the Tribunal considered the proposed name of valuers for

appointment as an independent valuer from the panel of the Tribunal.

Ultimately, Mr. DharmendraDhelariya was appointed as an independent

valuer to determine the valuation of shares of the Company and was called

upon to submit the valuation report within 30 days.

29. It has been argued by the learned counsel for the Appellant that,

though Mr. Dharmendra Dhelariya was appointed as an independent valuer

to carry out the valuation a fresh, but owing to the fact that whatever report

has been submitted by him, in fact, its not an independent report, rather, he

has relied upon the earlier reports and made the earlier report as the basis

of his report. It is submitted by the Appellant of Comp. App. (AT) No. 329 of

2026 that, the said report submitted by Mr. Dharmendra Dhelariya, should

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

13 of 20 not have been taken as to be the basis for determination of the exact value

of the Company's assets.

30. It is argued by the counsel for the Appellant that, since the valuation

report itself does not reflect a true and correct valuation, and as no

independent valuation was ever carried out by Mr. Dharmendra Dhelariya,

rather, he has referred to the earlier two valuation reports and borrowed the

earlier reports, which themselves had been doubted by the parties to the

proceedings in the Company Petition, because of the subsequent order by

learned NCLT, the same ought not to have been taken as the basis for the

fresh report submitted by Mr. Dharmendra Dhelariya for the purposes of

being considered while deciding the Company Petition.

31. Ultimately, the learned Tribunal, while deciding the respective issues

based upon the report of Mr. Dharmendra Dhelariya, proceeded to decide

the aforesaid issues as mentioned above, observing that Respondent No. 1,

i.e., Jupiter Comtex Private Limited, did have an organisational structure

having the characteristics of a closely held family company, in which

equitable consideration cannot be divorced from the corporate structure.

Because of the aforesaid fact that, it was a closely held family company, its

commercial activities ought not to be determined divorced from the

relationship between the constituent shareholders of the Company.

32. However, the learned Tribunal, while deciding Issue No. 1, pertaining

to the aspect of determination of act of oppression, and to bring the

proceedings within the meaning of Sections 241 and 242 of the Companies

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

14 of 20 Act, ultimately observed that the acts complained of did constitute as to the

acts of oppression. While holding the aforesaid conclusion, the Tribunal

observed that, since it was a closely and internally related company owing to

the family relationship, there were different expectations from the branches

in order to continue to have a fair and meaningful participation in the affairs

of the Company. It was ultimately observed that, because the affairs of the

Company and the fruits arising out of the business had to be in consonance

with and consistent with its constitutional framework, the same stood

frustrated, and the Tribunal came to a conclusion that there had been

conduct amounting to oppression.

33. The learned Tribunal, similarly, while considering Issue No. 2, with

regard to the conduct of affairs of Respondent No. 1 Company in a manner

constituting mismanagement, based upon the same set of evidence, came to

the conclusion that there had been mismanagement in the affairs of the

Company, for the reason that a parallel new partnership was incorporated,

which was dealing with the sale of textile machinery parts, which was

carrying out the similar business to that of Respondent No. 1 Company. The

turnover of the said firm increased, whereas the turnover of Respondent No.

1 Company is shown to have decreased. The said aspect has also been

argued by the counsels for the Respondents while taking us to the various

records.

34. Ultimately, it was observed that Respondent Nos. 2 to 4 had failed to

establish and assign any justified reason for starting a new business, and

that too with the exclusion of the Petitioner from carrying out the parallel

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

15 of 20 business, which could be said to be interlinked with one another. Looking to

the tenacity of the arguments, we could conclude that the records do reflect

that had been serious discord between the parties, which raises the

question regarding the manner in which the affairs of Respondent No. 1

Company were being conducted. It is evident, that consequent to the sad

demise of Late Shri Sanjay Mistry, and based on the material placed on

record, that the management of the affairs of the Company by Respondent

Nos. 2 to 4 was in a manner that was established to be detrimental to the

interest of Respondent No. 1 Company and its shareholders.

35. It was further concluded by the learned Tribunal, that there was

diversion of business and financial impropriety, resulting in the breach of

fiduciary duties, which was of a very high magnitude. While concluding

thereof, the Tribunal observed that there was nothing on record to show that

the business of Respondent No. 1 Company was to be shared with the

Petitioner. Accordingly, the Tribunal held that Respondent Nos. 2 to 4 had

diverted the business of Respondent No. 1 Company, and had siphoned its

funds, and had entered into related party transactions and committed other

breaches, and hence, observed that it was being in a manner which was

prejudicial to and oppressive to the functioning and interests of Respondent

No. 1 Company.

36. The learned Tribunal considered as to, under the given set of

circumstances and the evidence that has been placed on record, particularly

in context of the fractured valuation report and the manner in which the

Company has been financially siphoned, adversely affecting the interest of

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

16 of 20 Respondent No. 1 Company, the learned Tribunal, while exercising its

powers under Section 242(2)(h) of the Companies Act, recorded its finding in

Para No. 5.6, that the removal of Respondent No. 2 as a Director of

Respondent No. 1 Company, by exercising powers under Section 242(2)(h) of

the Companies Act, and, at the same time, appointing the nominee of the

Petitioner, holding 33.20% shares in the Company, as a Director, would

ensure that her interest as well as the interest of the Company are

protected.

37. Thus, the removal of some Director from the existing Directors, and

adding a Director from the Petitioner's side was taken to maintain a balance

in the constitution of the Board, so as to ensure successful operation of the

Company and to protect the interest of the stakeholders of the Company.

However, and rightly so, there was a denial of appointment of an

Administrator because of the fact that the Company was already functioning

with a changed configuration of the Directorships, as observed in Para No.

56.5 of the Judgment.

38. The learned Tribunal considered the fact that the relationship between

the parties, which was initially a closely-knit family business, has ultimately

fractured, and they have been litigating for several years, levelling serious

allegations against one another. The internal mutual confidence between the

parties has already been breached. The Tribunal thought that it would not

be appropriate to exercise its powers under Section 242(1)(b) to direct the

winding up of the Company. Owing to the aforesaid situation, the Tribunal,

while drawing its authority vested in it under Section 242(2), had carved out

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

17 of 20 an alternative solution, as has been referred to in the finding recorded in

Para No. 62 of the Judgment.

39. So far as the findings recorded in the conclusion drawn by the

Tribunal are concerned:

(1) Regarding the act of oppression within the meaning of Section 241 of the

Companies Act and the findings recorded pertaining to Respondent No. 1

being mismanaged; and

(2) Respondent Nos. 2 to 4 shall jointly and severally purchase the entire

shareholding of the Petitioner in Respondent No. 1 Company at the fair

value determined by Mr. Dharmendra Dhelariya.

40. This would not have been a fair observation made by the learned

Tribunal based upon the report of Mr. Dharmendra Dhelariya because, as

per the arguments extended by the learned counsel for the Appellant, the

report submitted by Mr. Dharmendra Dhelariya was not an independent and

fair report, owing to the fact that it was motivated as he had borrowed its

implications and the conclusions drawn from the earlier report, which has

not been accepted owing to the objections raised by the parties. Hence, at

this stage, carrying out the proposal of buying out the shares of the

Petitioner/Respondent in Company Appeal may not be feasible outcome to

be permitted to be continued under the Impugned Order.

41. The other finding that has been recorded pertains to the sale

consideration and for execution of documents for share transfer deeds, as

prescribed under Clauses 2 and 3, as per the finding recorded in the

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

18 of 20 Judgment, which has been directed to be undertaken within a period of 90

days, whether on the basis of valuation determined by the independent

registered valuer or at such mutually agreed value between the parties. This,

yet again, at the moment is a controversial observation made by the

Tribunal because both the things cannot co-exist. Either the valuer's report

has to be accepted for the purposes of the transfer of shares in the buy-back

policy of the shares of the Petitioner, and if that is to be followed, then there

is no question thereafter of a mutually agreed value between the parties.

42. So far as this stage of the appellate proceedings, is concerned, we are

of the tentative view, that is exclusively for the purposes of considering the

relief prayed for in the interim application, that it is not in controversy that

late Mr. Sanjay Mistry was one of the founding members of the Company.

Owing to the fact that the Petitioner never held the office of a Director, there

would be a complete exclusion from any meaningful participation in the

affairs of Respondent No. 1 Company.

43. Further, it shows that after the said demise of Mr. Sanjay Mistry, the

management of Respondent No. 1 Company remained exclusively within the

hands of Respondent Nos. 2 to 4. Respondent Nos. 2 and 3 were brothers,

and Respondent No. 4, who is the son of Mr. Gitesh Mistry, Respondent No.

2, in fact, it shows that the business remained in the hands of the family of

Gitesh Mistry and Jatin Mistry, though, despite the fact that they were

holding only 0.13% of the shares of the Company.

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

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44. Hence, while staying the effect of the Impugned Order dated

06.07.2026, except for Clause No. (v), as regards Respondent No. 2, Mr.

Gitesh Mistry, who would stand removed and cease to hold the office of

Director of Respondent No. 1 Company, and thereafter leaving it open for

the Petitioner to appoint a nominee as a Director of Respondent No. 1

Company, and upon receipt of such communication from the

Petitioner/Respondent Company, through the Board of Directors, shall

appoint the Petitioner's nominee as a Director. The directions as contained

in Clause (vi) of the Order, are not being disturbed by us. The same would

not be given effect to by the Respondent, till next date of listing.

[Justice Sharad Kumar Sharma] Member (Judicial)

[Indevar Pandey] Member (Technical) NEW DELHI 07th October, 2026 rashmi

I.A No. 6189 of 2026 in Comp. App. (AT) No. 329 of 2026 & I.A. No. 6537 of 2026 in Comp. App. (AT) No. 340 of 2026

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