Esquire Electronics Inc & Anr vs Netherlands India Communications ...
- CitationCompany Appeal (AT) No.351 of 2019
Ratio decidendi
The rule this decision rests on
The appellate tribunal declined to modify an interim order of the Company Law Tribunal, reasoning that while the question of alleged operational mismanagement remains pending before the Tribunal and notice has been issued, it will not interfere with the interim direction. The appellate tribunal held that the pendency of a parallel criminal FIR and a High Court execution proceeding does not restrain the parties from pursuing those proceedings, and that any transfer of the FIR to the Tribunal under Section 434 of the Companies Act, 2013 is a matter for the High Court to decide in accordance with law.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
IN THE MATTER OF: Esquire Electronics Inc & Anr. .....Appellants Vs. Netherlands India Communications Enterprises Ltd. & Ors. ......Respondents
Present : For Appellant: Mr. Rajeev Ranjan, Senior Advocate, Mr. K.Datta, Mr. Manu Beri, Advocates
For Respondents: Dr. U.K. Chaudhary, Senior Advocate, Mr. Akshay Malik, Mr. Dhruv Gupta, Advocates
O R D E R
04.12.2019 - The Appellant 'M/s Esquire Electronics Inc & Anr.' filed an
application u/s 398 of the Companies Act, 1956 (now Section 241 and 242 of
the Companies Act). In the said petition, 'National Company Law Tribunal',
New Delhi, Special Bench by impugned order dated 29th November, 2019 issued
notice and passed certain interim order which is as follows: -
"CA-2665(PB)/2019
The applicants in the instant application
have filed the CP.No. 108(ND)/2016 under Section
Company Appeal (AT) No.351 of 2019 1 397-398 of the Companies Act, 1956. The applicants
have filed the instant application mainly seeking a
direction to the respondents to deposit the award
amount of the Execution Petition being OMP (ENF)
(COMM.) 25/2018 into this Tribunal and also a
further direction to the respondents to restrain them
from conducting/holding Annual General Meeting
scheduled to be held on 30.11.2019.
Heard, Mr. Datta, Ld. Counsel for the applicant and
Mr. Yogesh Jagia, Ld. Counsel for the respondent No.
1 to 3 and have perused the pleadings on record. Mr.
Jagia, Ld. Counsel for the respondent No. 1 to 3 shall
file their reply within ten days with a copy in advance
to the counsel for the applicant.
Notice of the application to the remaining non
applicant-respondents and affidavit of service shall
be filed thereto.
In the circumstances and in view of the submissions
made by Ld. Counsels, respondent No. 1 to 3 are
directed to keep at least 15% of the amount of awar4d
to be received in Execution Petition OMP (ENF)
(COMM.) 25/2018 intact until further orders. The
Company Appeal (AT) No.351 of 2019 2 AGM scheduled to be held on 30.11.2019 may go on,
however, respondent No. 1 to 3 are directed not to
disturb the share distribution ratio of the applicants
without leave of this Tribunal.
List for further consideration on 06.02.2020."
Learned Counsel appearing on behalf of Appellant submitted that the
appeal is being filed for modification of the direction to the Respondents to
immediately deposit the full award amount with NCTL as and when the same
are released to Respondent Company in execution petition from the Hon'ble
High Court of Delhi pending investigation in FIR No. 0258/2018 filed on 13th
August, 2018.
We have heard learned Counsel appearing on behalf of the Appellant Mr.
Rajiv Ranjan, Sr. Advocate with Mr. Vishnu Sharma and Dr. U.K. Chaudhary,
Learned Sr. Advocate with Mr. Akshay Malik, Learned Counsel for the contesting
Respondents.
Taking into consideration the fact that the matter is still pending before
the Tribunal to determine the question of operational mis-management as
alleged and notice has been issued, we are not inclined to modify the interim
order already passed.
The order passed by the Tribunal or this Appellate Tribunal will not come
in any way of the Appellant for pursuing the matter of execution case, or the FIR
Company Appeal (AT) No.351 of 2019 3 which has already been lodged and to request the Hon'ble High Court for its
transfer to the 'National Company Law Tribunal' Delhi, in terms of Section 434
of the Companies Act, 2013. It is for the Hon'ble High Court of Delhi to decide
the same in accordance with law.
It will also be open to the parties to pursue the FIR pending before the
Forum.
The appeal stands disposed of with aforesaid observation.
[Justice S. J. Mukhopadhaya] Chairperson
[ Justice Bansi Lal Bhat ] Member (Judicial)
[Justice Venugopal M.] Member (Judicial)
ss/sk
Company Appeal (AT) No.351 of 2019 4
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