Biju Scaria vs Media Team Solutions India Private ...

Tessy Scaria Flat No.9C, Mangalam Towers, Vennala P.O., Cochin - 682 028. ...Appellants V Media Team Solutions (I) Pvt Ltd Having its registered office at 47/667 B, Media Enclave, Chalikkavattom Kumbalappilly Road, Vennala P.O., Kochi, Kerala - 682 028.

Binoy Govindhan Sree Vihar, Chamakala P.O., Kothanalloor, Kottayam - 686 603.

Abraham Mathew Ambattu, Asamannoor, Vaikkara, Ernakulam - 683 549.

Shamini T.V. Sree Vihar, Chamakala P.O., Kothanalloor, Kottayam - 686 603.

Comp App (AT) (CH) No.123/2025 Page 1 of 10 Savitha Mani Ambattu, Asamannoor, Vaikkaram, Ernakulam - 683 549. ...Respondents s

Present :

For Appellants : Dr. KS. Ravichandran, PCS For Ms. S. Manjula Devi, Advocate For Respondents : Ms. Sreepriya Kalarikkal, CS for R1-R5

JUDGMENT

(Hybrid Mode)

[Per : Justice Sharad Kumar Sharma, Member (Judicial)]

The Appellant in the instant Company Appeal, is the Petitioner / Applicant

to the Application IA(C/Act) No.115/KOB/2025, where the Appellant had sought

for grant of an interim relief during the pendency of the Company Petition

preferred by him, being CP(C/Act) No.31/KOB/2024 before Learned NCLT,

Kochi. The said Application has been rejected by the Learned Tribunal by the

order dated 26.08.2025. Aggrieved by the said order, the instant Appeal has been

filed.

2. Brief facts, which require a marginal reference is that, the Appellant had

preferred a Company Petition, by invoking the provisions contained under

Section 241 & 242 of the Companies Act, 2013, praying for a grant of appropriate

orders, directions and reliefs under Section 241 & 242 of the Companies Act and

other applicable provisions of the Companies Act, to bring to an end to the

aforesaid alleged acts of oppression and mismanagement, as detailed therein in

Comp App (AT) (CH) No.123/2025 Page 2 of 10 the Company Petition, being perpetuated by Respondents 2 to 5, a declaration

that the act of Respondent No.2 is oppressive and prejudicial to the interest of the

1st Respondent company, to set aside notice of board meeting dated 09.10.2024,

to declare that Respondents 2 to 5 are not entitled to continue as directors of

Respondent 1 company and to direct their removal, and to pass appropriate orders

regulating conduct of affairs of the Respondent 1 company by superseding the

Board & directing reconstitution of the same as may be deemed just and proper.

In the memo of Company Petition itself, the Appellant had also modulated the

interim relief, which he had prayed for to be granted during the pendency of the

Company Petition, which was modulated in the following manner: -

"The facts and circumstances of the case clearly show that the Petitioner has a strong prima facie case and that the balance of convenience is in favour of orders being passed as prayed for. Unless interim orders as prayed for herein are passed, the Petitioner will suffer irreparable loss and injury and will be gravely prejudiced. In such circumstances, the petitioner prays that the Hon'ble Board may be pleased to grant the following interim reliefs, pending disposal of the company petition;

1. Set Aside the Annexure-A6 Notice and direct the 2nd Respondent to call back the proposed meeting.

2. That the Respondents be directed to maintain status quo with regard to the Shareholding of the 1st Respondent company as on 29.10.2024;

3. That the Respondents 2-5 be restrained from filing any documents, returns, forms, report, certificate, balance sheet,

Comp App (AT) (CH) No.123/2025 Page 3 of 10 statements on behalf of the 1st Respondent company, without the approval of the Hon'ble Tribunal;

4. Grant such interim reliefs in terms of the main relief to the extent deemed just and necessary by this Hon'ble Tribunal".

3. Apart from the said interim relief as sought for in the Company

Petition, the Appellant, on 23.06.2025, had filed yet another Interlocutory

Application IA No.115/KOB/2025, wherein the Appellant has prayed for the

grant of certain interim reliefs which are extracted hereunder: -

"In the above circumstances, it is most respectfully prayed that this Hon'ble Tribunal may be pleased to:

a. Grant an interim stay of the Extraordinary General Meeting scheduled to be held on 01.07.2025 pursuant to the notice dated 09.06.2025;

b. Pass an order restraining the Respondents from proceeding with any resolutions or corporate actions arising out of or in furtherance of the said notice;

c. Direct that status quo be maintained in all respects with respect to the management and operations of the Company pending hearing and final disposal of the Company Petition;

d. Pass such other or further orders as this Hon'ble Tribunal may deem fit and proper in the interests of justice".

4. The interim reliefs sought for as above were basically in the nature of

seeking a restraint order as against the Respondents of the Company Petition

from conducting the Extraordinary General Meeting which was scheduled to be

Comp App (AT) (CH) No.123/2025 Page 4 of 10 held on 01.07.2025, pursuant to the notice of 09.06.2025 and from proceeding

with any resolution or any corporate action arising out of and in furtherance of

the said notice dated 09.06.2025. But the fact remains that, when the

proceedings of the IA(C/Act) No.115/KOB/2025, were taken up before the

Learned Tribunal, Learned Tribunal after considering the rival contentions, and

the averments, which were made in the proceeding, held on 23.06.2025,

observed and recorded a categorial finding that there was no procedural anomaly

in so far as it relates to the issuance of the notice of 09.06.2025, for the purposes

of holding of the EGM on 01.07.2025 and further observed that any resolution

passed or any action taken in pursuance to the proceedings to be held on the basis

of the notice of the EGM dated 09.06.2025, would be subject to the decision to

be taken on the said Interlocutory Application. Learned Tribunal also observed

that the Board of Directors of the 1st Respondent Company had already called

the EGM as per the provisions of the Companies Act, 2013, and that, in the said

EGM, supposed to be conducted on 01.07.2025, the Petitioners will have all the

rights and opportunities to place their version before the shareholders of the

company.

5. Learned Tribunal observed in the order dated 26.06.2025 that, since

there was no procedural anomaly and no procedural or legal lapses as per the

provisions of the Companies Act in calling for the EGM by the Board of

Directors (BOD), staying the conduct of the said EGM, should not be ventured

Comp App (AT) (CH) No.123/2025 Page 5 of 10 into as it would amount to be an interference in the day-to-day functioning of the

company. This order passed by the Tribunal on 26.06.2025 has attained finality

and has not been put to challenge by the Appellants before any superior forum.

Subsequent thereto, the EGM was conducted on 01.07.2025, and by virtue of an

Resolution passed by the said EGM, Appellant No.2 was directed to be removed

from the position of the Whole-Time Director of the company with effect from

the date of the meeting, i.e., 01.07.2025, as per the provisions of Section 169 of

the Companies Act, 2013.

6. The Learned Tribunal, while considering the IA(C/Act)

No.115/KOB/2025, while dismissing the same, has observed that the right of the

shareholders to remove the directors is absolute, as per the provisions contained

under Section 169 of the Companies Act, 2013, and the same cannot be diluted

by virtue of a judicial interference on consideration of equity unless there is

illegality, malafide intent or violation of natural justice. The basic objective of

Section 169 is that the corporate democracy must prevail, until or unless the

statutory process is abused. In the instant case, the Appellants had not been able

to establish before the Learned Tribunal or by way of any documents, which

have been placed on record that there was any procedural anomaly, because the

notice of 09.06.2025 and the special notice, which was floated by the

shareholders holding more than 66.64% voting powers, satisfy the procedures

contemplated under the Companies Act. The copy of the said notice was duly

Comp App (AT) (CH) No.123/2025 Page 6 of 10 served upon the applicants, and they were provided with an opportunity to

represent their case, the EGM was conducted with full transparency including

the appointment of an independent scrutinizer and the minutes of the meeting

were shared. The Tribunal, after taking into consideration of the above and its

own observations made in the order dated 26.06.2025, came to a conclusion in

the impugned order that there is nothing to show any procedural anomaly or

irregularity in the conduct of the EGM, and that the EGM was duly covered in

compliance with statutory requirements and that the motion, which has been

carried was well within the ambit of the provision contained under Section 169

of the Companies Act, 2013.

7. The Appellant has attempted to harp upon the subject of the settlement

talks, as well as, the issue of the appointment of the valuer in pursuance to the

deliberations which were recorded in the hearings that were held on 05.06.2025

and 13.06.2025 by Learned NCLT. Learned NCLT, in this regard, has observed

that the said hearings deliberated an appointment of a valuer and no commitment

was recorded as regards to the share transfer or valuation date and no consensus

existed on these issues and that no status quo was ordered restraining the

company from conducting its business on account of the above. Based on the

above and holding that the statutory framework of the provisions contained

under the Companies Act, is predominantly intended to protect the shareholders'

right while balancing the corporate autonomy and it is absolutely legal for the

Comp App (AT) (CH) No.123/2025 Page 7 of 10 shareholders to exercise its powers within the ambit of Section 169 of the

Companies Act, 2013, to remove a director, the Learned Tribunal came to the

conclusion in the impugned order that since there was no legal flaw in calling

upon the EGM, there is no case for an interference by way of grant of an interim

order as it was prayed for in the IA that, was preferred by the Appellant.

8. By the time when the IA(C/Act) No.115/KOB/2025 was finally

considered by the impugned order of 26.08.2025, the EGM of 01.07.2025 had

already been conducted, and Appellant No.2 had been directed removed from

the post of director. Thus, the Tribunal observed that by the time the IA was

heard on 30.07.2025 or even on the date when the impugned order was passed

i.e., on 26.08.2025, since the EGM has already been conducted on 01.07.2025

consequent to which Appellant No.2 since has already been removed from the

directorship, the prayer for grant of the first relief as extracted above, as it has

been prayed for in IA(C/Act) No.115/KOB/2025; has been rendered redundant,

and that the second relief, which was modulated in the interlocutory application,

was based upon the first relief of restraining the proceedings of the EGM as

scheduled on 01.07.2025, was consequential in nature, and that once the first

relief was denied to be granted by the earlier order as passed by the Tribunal on

26.06.2025, the second relief of restraining the Respondents from proceeding

with the resolution or the corporate action arising out of or in furtherance of

the said notice, for all practical purposes, has become infructuous.

Comp App (AT) (CH) No.123/2025 Page 8 of 10

9. Owing to the savings prescribed by the Tribunal in para 16 of the

impugned order rendered on IA(C/Act) No.115/KOB/2025, while rejecting the

interlocutory application, coupled with the reasoning put forth by Learned NCLT

in respect of the need to respect corporate democracy and the right of

shareholders and the action taken holding them to be within the statutory

framework of the Companies Act, 2013, the denial to grant an interim relief by

the impugned order does not suffer from any apparent error, which will call for

any interference by this Appellate Tribunal.

10. Apart from it, the Learned Counsel for the Respondent has attempted

to draw the attention of this Tribunal to the special notice for the removal of the

Whole-Time Director which has been issued under Section 169 of the

Companies Act, to be read with Section 116 of the Companies Act, for the

reasons which have been given therein. The Respondent Counsel has attempted

to justify that the holding of the EGM of 01.07.2025, holding that it cannot be

said to be contrary to law or owing to the conduct of Appellant No.2, which was

in consonance to the special notice under Section 115 to be read with Section

169 of the Companies Act, 2013. We, at this stage, are refraining ourselves from

making any remark upon the set of eleven allegations that has been levelled

against the Appellant No.2, which obviously would be the subject matter of the

Company Petition, to be decided for which liberty has been given by Learned

NCLT as contained in para 16 of the impugned order. Owing to the above, the

Comp App (AT) (CH) No.123/2025 Page 9 of 10 interim order does not suffer any procedural flaw or violation of the Companies

Act. Further, because the EGM has already been held on 01.07.2025, the nature

of the interim relief, as it was sought in IA(C/Act) No.115/KOB/2025 has been

rendered redundant, with the efflux of time, owing to the proceedings held before

the Learned NCLT on 30.07.2025 and 26.08.2025 and therefore, at present, there

cannot be a status quo till the Company Petition itself is finally adjudicated.

Thus, the Company Appeal lacks merit and the same is accordingly dismissed.

All Interlocutory Applications would stand closed.

[Justice Sharad Kumar Sharma] Member (Judicial)

[Jatindranath Swain] Member (Technical) 13/10/2025 VG/MS/AK

Comp App (AT) (CH) No.123/2025 Page 10 of 10