Dr Acharya Laboratories Private ... vs Venkatraman Narayan Bhagwat

[Arising out of Order dated 12.01.2026 passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench) in Company Petition No. 162 of 2022]

IN THE MATTER OF: 1. Dr. ACHARYA LABORATORIES PRIVATE LIMITED A Company Registered Under the Companies Act, 2013, Having Its Registered Office at Sal Jyot, Office No.105, 1st Floor. Neepa CHS, Junction of S.N. Road & S.L. Road, Mulund West, Mumbai City, Maharashtra - 400080 CIN: U24200MH2005PTC153343 ...Appellant No. 1 2. ANAND ACHARYA An Adult Indian Inhabitant, Having his Office Address at Sal Jyot, Office No. 105, 1st Floor. Neepa CHS, Junction of S.N. Road & S.L. Road, Mulund West, Mumbai City, Maharashtra - 400080 ...Appellant No. 2 3. SHRIKANT ACHARYA An Adult Indian inhabitant, Having his Office Address at Sal Jyot, Office No. 105, 1st Floor. Neepa CHS, Junction of S.N. Road & S.L. Road, Mulund West, Mumbai City, Maharashtra - 400080 ...Appellant No. 3 4. SHRIPATI ACHARYA An Adult Indian Inhabitant, Having his Office Address at Sal Jyot, Office No. 105, 1st Floor. Neepa CHS, Junction of S.N. Road & S.L. Road, Mulund West, Mumbai City, Maharashtra-400080 ...Appellant No. 4 5. USHA ACHARYA An Adult Indian Inhabitant, Having her Office Address at Sal Jyot, Office No. 105, 1st Floor. Neepa CHS, Junction of S.N. Road & S.L. Road, Mulund West, Mumbai City, Maharashtra - 400080 ...Appellant No. 5

Versus

VENKATRAMAN NARAYAN BHAGWAT An Adult Indian inhabitant, Having his Office Address at Sal Jyot, Office No.105, 1st Floor. Neepa CHS, Junction of S.N. Road & S.L. Road, Mulund West, Mumbai City, Maharashtra-400080. ...Respondent

Present: For Appellants : Mr. Rahul Chitnis, Mr. Parmatma Singh, Ms. Nishita Jagetia and Ms. Manorama Mohanty, Advocates.

For Respondent : Mr. Bharadwaj S. Iyengar, Advocate.

JUDGMENT

Per Justice Sharad Kumar Sharma, Member (Judicial)

1. This Company Appeal arises out of proceedings under Sections 241,

242 & 244 of the Companies Act, 2013, which were initiated by the

Respondents to the Company Appeal. The said proceedings were registered

as Company Petition No. 162 of 2022, Venkatraman Narayan Bhagwat

Versus Dr. Acharya Laboratories Pvt. Ltd. & Ors. before the NCLT, Mumbai

Bench, and were adjudicated by the judgment dated 12.01.2026, which is

under challenge in the instant Company Appeal.

2. The Appellant's case is that Respondent No. 1, who was a graduate in

Science (Chemistry), owing to the fact that he had considerable control over

the subject and was backed by knowledge in the field of pharmaceutical

development and manufacturing, was employed with M/s Anand Comp. App. (AT) No. 100 of 2026 2 of 10 Synthochem, as far back as 1972-1973. It is against this backdrop, while

working with Anand Synthochem, that Respondent No. 1 is said to have met

with late Mr. Srinivas Acharya. Because of his past background and

persuation, Respondent No. 1 was shown to have been added as a partner in

a partnership firm with late Dr. Acharya, Respondent No. 3 herein, and late

Dr. Acharya's mother, alongside another partner, Mr. V.S. Hosurkar, and

they founded a firm named "Acharya Chemicals" in 1973.

3. One of the partners, Mr. V.S. Hosurkar, retired from the firm, and

consequent to it Appellant No. 4 was inducted as a partner, carrying on the

business of manufacturing and selling chemicals. Right from the date of his

inception, the Petitioner was shown to be holding 16% of the profits and

losses of Acharya Chemicals. In 1997, Dr. Srinivas Acharya's mother was

replaced by Appellant No. 2 as a partner. Owing to the passing away of Dr.

Srinivas Acharya, who died on 10.11.1999, Appellant No. 5 was added as a

partner in Acharya Chemicals. After acquiring all these business

experiences, the partners of Acharya Chemicals acquired another private

company which too was engaged in the business of manufacturing and

selling chemicals, i.e., M/s Shirdi Chemicals Private Limited. In view of the

expansion attained by the Company the business and Appellant No. 1

Company - Dr. Acharya Laboratories Private Limited - was incorporated in

2005 by the partners of Acharya Chemicals.

4. Respondent No. 1 accepts that Acharya Chemicals and three private

limited companies (being Appellant No. 1, Asvik Pharma and Chemicals

Private Limited, and Shirdi Chemicals Private Limited), together with M/s Comp. App. (AT) No. 100 of 2026 3 of 10 Herbert Brown Pharmaceutical and Research Laboratory (in which Appellant

Nos. 2, 3, and 5 were partners), carried forward the business under the

name of the M/s Acharya Group.

5. According to Respondent No. 1, Acharya Chemicals it continued its

business with Appellant No. 1 and carried on new businesses operations. As

such, it was argued that Appellant No. 1 cannot be treated as a quasi-

partnership, owing to the fact that the quasi-partnership concept could only

be available when the partnership is converted into a corporate form and its

previous business is subsequently continued through the company.

Because, according to the case of the Appellant, there were no such

ingredients available, the so-called concept of quasi-partnership did not

stand fulfilled.

6. The dispute started arising amongst themselves when an allegation

was raised in 2019, where Appellant No. 2 suggested to the Respondent to

exit from the Acharya Group consisting of the two firms as referred to above;

however, owing to the Respondent not being satisfied with the valuation of

the shares, he accordingly refused to exit.

7. Because of the change in configuration of the companies due to the

progression made in the business of the company, an AGM of the company

was held on 31.12.2020, wherein certain amendments were made to be

carried in the Articles of Association of the company. The AGM of

31.12.2020 showed that the Respondent attended the meeting, and not only

Comp. App. (AT) No. 100 of 2026 4 of 10 that, he voted in favour of the amendments, and his name also finds

reference in the attendance slip of the AGM held on 31.12.2020.

8. Respondent No. 1, despite having attended the AGM of 31.12.2020

and having voted in favour, started raising allegations contending that the

alleged amendments carried out in the company's Articles of Association

vide various resolutions passed in the AGM of 31.12.2020 were alleged to be

illegal. Also, because of the fact that it was brought to his knowledge for the

first time in March 2022, based upon the aforesaid grounds, the Respondent

has put a challenge to the AGM of 31.12.2020 wherein under Article 60,

Appellant Nos. 2, 3, and 5 have been designated as permanent Directors;

under Article 69, the board's meetings were left open to be summoned by

Appellant Nos. 2, 3, and 5; under Article 64, it permitted the holding of

board meetings with at least two days' notice; and lastly, by Article 72, only

Appellant Nos. 2 and 5 can be the chairperson of meetings.

9. On the basis of the AGM of 31.12.2020, an amendment was made in

the company's Articles of Association. The amendment that was made by the

AGM of 31.12.2020, bringing changes in the Articles of Association as

detailed above, they were not welcomed and hence was subjected to

challenge in the proceedings of the Company Petition, which ultimately,

upon its adjudication, was held not to be an oppressive act because of the

fact that Article 64 did permit the holding of the board's meeting for at least

two days' notice which was mandatory.

Comp. App. (AT) No. 100 of 2026

5 of 10

10. There had been a corresponding resolution to amend the

Memorandum of Association (MoA) too for the purposes of increasing the

authorised share capital, in which the Respondent attended the board's

meeting and discussed the issue with regard to the issue of increase of the

authorised share capital and to carry out the alteration in the MoA.

Consequently, in the board's meeting of 27.12.2021, the resolution was

carried by an unanimous decision of which the petitioners were also shown

to be the signatories.

11. Consequently, on 21.12.2021, a notice of the EOGM was issued to the

members of the Company, including to the Appellant, for convening the

EOGM on 31.12.2021, for the purposes of discussing the upon the issues

pertaining to share capital and its alteration, which too was attended by the

Respondent, and it was thereupon resolved to increase the share capital and

to alter the MoA. After carrying out the aforesaid EOGM on 31.12.2021,

Form No. SH-7 was issued to the Registrar of Companies, giving intimation

about the increase in the authorized share capital vide the resolution carried

by the EOGM of 31.12.2021.

12. The Respondent, by projecting a false case, has alleged that he could

learn about the amendment carried out in the Company's MoA for the first

time in March, 2022, and by alleging that he was not in receipt of any

notices of such meeting, it was based upon the aforesaid facts and

circumstances, that the Company Petition was preferred by the Respondent

seeking a declaration that the business affairs of the Appellant No. 1

Company were carried out by Appellant Nos. 2 to 5 in a manner prejudicial Comp. App. (AT) No. 100 of 2026 6 of 10 to the interest of the Appellant No. 1 Company, alongside with other reliefs

prayed for in the proceedings under Sections 241, 242, and 244 of the

Companies Act.

13. The learned Tribunal, while deciding the Company Petition on its own

merits by the judgment dated 12.01.2026, observed that as far as the

amendment in the MoA through the EoGM held on 31.12.2021 is concerned,

as the Respondent had marked his attendance, in the attendance sheet of

the first Respondent Company, showing their presence for the EoGM of

31.12.2021, the learned Tribunal recorded a finding regarding the

amendment in the MoA together with the impugned rights issue.

14. To conclude with the increase in the authorized capital as a rights

issue made in March, 2022, it was observed that in accordance with the

notice dated 10.03.2022 for the board meeting to be held on 12.03.2022--

even though the said notice was in violation of Section 173(3) of the Act,

which prescribes 7 days' notice, but since the Petitioner had signed the

letter on 12.03.2022, giving consent for a shorter notice, and also because of

the fact that the board's meeting lasted for three minutes, as is evident from

the minutes book recording the start and conclusion of the meeting, the

Tribunal, upon considering the rival contentions, observed thereof that five

days before the rights issue was placed for consideration, the Company had

liquidated a fixed deposit of Rs. 4.5 Crores with Saraswat Bank, which had

matured on 07.03.2022. Ultimately, the Tribunal came to the following

conclusion:-

Comp. App. (AT) No. 100 of 2026

7 of 10 "52. We have noted that the amendment to AoA as well as Right issue constitutes act of oppression to the petitioner. Further, the pleadings of both the parties demonstrate that an irretrievable breakdown in trust and confidence between the Petitioner and Acharya Family has taken place. Accordingly, it will just and equitable to wind up the affairs of the Respondent Company, however, it is also pertinent to note that such winding up shall be unfairly prejudicial to the Respondents, we consider it appropriate to direct the Respondent No. 1 Company to buy out the shares of the Petitioner on a fair value of the Respondent Company as on 31.3.2022 to be determined by a reputed valuer on pre-right issue shareholding and the value so determined shall be further adjusted by an interest factor of 8% p.a. till 31.12.2025 so as to account for the compensation to the Petitioner for the period, he was kept out of money. The Respondent No. 1 shall pay the amount so determined within 3 months from the dated of this order. Alternatively, the Respondent No. 2 to 5 shall be at liberty to pay the amount so determined to the Petitioner for purchase of his shares in their name or in their nominee(s) name. The Respondent Company shall file appropriate application before this Tribunal by 15th April, 2026 for taking compliance on record."

15. On the basis of the aforesaid conclusions drawn, the Company

Petition was allowed, and CA No. 265 of 2022, which was filed by the

Petitioner for urgent listing, was disposed of. The Company Appeal was

preferred before this Tribunal on 22.02.2026, wherein notices were issued

Comp. App. (AT) No. 100 of 2026 8 of 10 and an interim Order was passed, to the effect that the deadline given of

15.04.2026 would stand extended.

16. While the matter remained pending, the parties filed I.A. No. 6310 of

2026 under the joint signatures of the Appellant, contending thereof that as

the shareholding of the Appellant No. 1 in the Company was 6.4% of equity

shares. Because the challenge under Sections 241 and 242 of the

Companies Act, 2013, as raised in the Company Petition was restricted to a

rights issue undertaken by the Company on 15.03.2022, the parties had

placed on record the consent terms agreed between them. Wherein they

prayed that the Company Appeal may be disposed of, observing thereof that

the Application may be allowed and the consent terms dated 31.08.2026

may be taken on record.

17. Heard learned counsel for the parties. I.A. No. 6310 of 2026 which is

accompanied by respective affidavits of the parties supporting the contents

of the terms of settlement as referred to in the application and made as a

part of it, which has been submitted under the joint signatures of the

parties to the Appeal. The said consent terms would be treated as part and

parcel of the decision being rendered by us in the instant Company Appeal.

18. On the basis of the settlement, and in view of the terms contained in

the settlement/consent terms, the Order dated 12.01.2026 passed by the

NCLT, Bench - I, so far as it relates to holding the amendment of the Articles

of Association, as well as the rights issue, as constituting acts of oppression

to the Respondent, is set aside and is quashed by consent. Accordingly, the

Comp. App. (AT) No. 100 of 2026 9 of 10 parties agree that they will adhere to the conditions of the settlement dated

31.08.2026.

19. Owing to the quashing of the Order by consent, the parties would be

strictly bound by the terms of the consent letter in relation to the aspects

covered therein, as contained in Para No. 3 of the said consent letter. Owing

to the consent arrived at between the parties, the impugned Order dated

12.01.2026 passed in Company Petition No. 162 of 2022 would stand

quashed, and inter se rights, liabilities, and the conduct of the parties to the

Appeal would be governed by the terms and conditions contained in the

consent letter dated 31.08.2026, to which the Respondents have also

agreed.

20. Accordingly, owing to the above, the Company Appeal would stand

allowed. The impugned order on 12.01.2026 as rendered in Company

Petition No. 162 of 2022 is quashed. All pending interlocutory application

would stand closed.

[Justice Sharad Kumar Sharma] Member (Judicial)

[Arun Baroka] Member (Technical)

[Indevar Pandey] Member (Technical) NEW DELHI

25th September, 2026

rashmi

Comp. App. (AT) No. 100 of 2026 10 of 10