Eyelid Infrastructure Private Limited vs Birenbhai R. Panchal

1) Mr. Birenbhai R. Panchal ....Respondents S/o. Rameshkumar S. Panchal 2377, Parabdi Ni Pole, Near Halim Ni Khadki, Shahpur, Ahmedabad- 380001

2) Mr. Vasudev B. Patel S/o. B. Patel At Saduthala, TA-Visnagar, Mehsana -2-

3) Shri. Mayank R. Bhatt ....Pro forma S/o. R. Bhatt Respondents Patel Falia, Borsad, Dist. Anand

Present: For Appellant: Mr. Gaurav Goel, Advocate

For Respondent: Mr. P. Nagesh And Shri Abhishek Bansal, Advocates

ORDER

27.10.2017: Heard counsel on the point of delay in filing the appeal. For

reasons stated, the delay is condoned. Now the Appeal is taken up for hearing

with consent of both sides.

Heard learned counsel for the appellants and the respondents on the

grounds raised in Appeal. In this matter in the Company Petition filed between

the parties the appellants were respondents. In the Company Petition (No.

27/111/CLB/MB/MAH/2013) respondents filed Consent Terms which were

dated on 18th October, 2013 (Annexure-4) before the Company Law Board on

22nd December, 2014. The order passed reads as under:

C. P. No. 27 of 2013

1. Case taken up today in presence of the Respondents Counsel

named above. Nobody is present on behalf of the Petitioners.

2. The Ld. Counsel appearing for the Respondents submitted a copy

of the Consent Terms. Let the same be taken on record. The Consent

Terms reveals that the Petitioners have agreed therein to withdraw -3-

their petition. The petition is, accordingly, dismissed as withdrawn.

The Consent Terms shall form part of this order.

3. No order as to costs.

4. Copy of the order be issued to the parties.

Dated this 22 December, 2014.

It is apparent that in the absence of the petitioners of the Company

Petition the matter was taken up on Board and the copy of the Consent Terms

was acted upon. The respondents filed an Application for withdrawal of this

orders passed, for which application Dt. 27th January, 2015 was filed before

Company Law Board for recalling of the order of Company Law Board which

was passed on 22nd December, 2014.

The matter appears to have subsequently got transferred from Company

Law Board to the learned National Company Law Tribunal Mumbai Bench,

Mumbai. The National Company Law Tribunal has recalled that the order

passed behind back of present respondents and recalled the Ex-parte order Dt.

22nd December, 2014 and directed listing of the Company Petition. This is

impugned order passed in C.A. 30/2015 in C.P. No. 27/111/

CLB/MB/MAH/2013 Dt. 02.05.2017.

Aggrieved by this order, the present appellants have moved this appeal. It

is submitted by the learned counsel for the appellants that the respondents in -4-

the appeal have not disputed that they indeed joined the Consent Terms. The

Consent Terms were substantially acted upon it is stated. He is referring to

Annexure R-1 before the Company Law Board (Pg. 118 of PaperBook) to point

out that they had objected in the Tribunal below & pointed out various actions

taken under the compromise whereby the present Appellants have taken

benefit of the Consent Terms. It is submitted by the learned counsel that the

only thing remained to be done under the Consent Terms was that the present

respondents were to return the original deeds and documents to the

Appellants. As now the rates of property have increased the present

respondents moved the 'Application for Restoration' of the Company Petition

and withdrawal of the compromise terms which had been taken on record by

the Company Law Board, it is stated.

Learned counsel for the Respondents is however opposing the application

and submitting that the Consent Terms which were executed between the

parties entered into troubled waters soon after they were executed and the

terms were decided not to be acted upon. He says that there were various acts

on the part of the present Appellants because of which it did not become

possible for present respondents to continue with the Consent Terms which

they had entered into. The Appellants had failed to fulfill their commitment. It

is stated that after more than a year photocopy of the Consent Terms were filed

before the Company Law Board and the Petition was got disposed behind the

back of the respondents who were Petitioners in the Company Petition and

such procedure is unknown to procedural Law.

-5-

We have gone through the matter. The learned NCLT observed in Para 6

as under:

Heard both the sides at some length in the light of the pleadings

on record and the case law cited. Although an Order had been

passed and the impugned petition was "dismissed as

withdrawn" but the admitted factual position is that the said

Judgment was passed in the absence of the Petitioner. Only the

Learned Counsel of the Respondent was present who had

placed a copy of the Consent Terms on Record. No one was

present from the side of the Petitioner to affirm the authenticity

of the Consent Terms. As a result the admitted factual position

on the said date of hearing was that an Ex-parte Order was

passed qua the Petitioner. Moreover, another admitted factual

position had created a genuine doubt that why the impugned

withdrawal petition was signed on a day earlier (i.e.

17.10.2013), than the date on which the Consent Terms was

signed (i.e. 18.10.2013). The Petitioner is stating that taking the

undue advantage of ex- party dismissal of the Petition, the

Respondents are not fulfilling their part of commitment as

agreed upon in the said Consent Term.

Then it was observed in Para 10 as follows:

I therefore conclude that no prejudice is going to be caused to

the Respondent if the impugned Ex-parte Order dated -6-

22.12.2014 is recalled and the C.P. be listed for hearing. This

view is almost in line with an observation earlier made by that

very Hon'ble Member on 30th of March 2015 (reproduced supra)

granting hearing to the Petitioner. The Respondent shall, as

well, get a fair chance either to demonstrate that the terms of

the Consent have been implemented or to challenge the merits

of the Petition. Nevertheless, in either case, the Respondent's

legal rights are not going to be adversely effected if the matter

is listed for hearing.

Looking to the reasonings recorded by the NCLT and the facts & law we

find that principles of natural justice require that when the matter is to be

disposed on the bases of Consent Terms which are stated to have been

executed between the parties, it is duty of the authority to ensure that both the

parties are before the authority and both the parties agree to the Consent

Terms before same are acted upon. It is also necessary to see that the terms

are lawful. Only after such exercise the concerned authority can act upon those

consent Terms. In this matter the learned counsel for the respondent states

that the original Consent Terms are with them and on the basis of photocopy

the matter was got disposed off.

This point was raised even before the learned NCLT where it was pointed

out that on the basis of Xerox copies produced the Company Law Board had

disposed off the matter. The copy of the order which has been reproduced

above also shows that the counsel for the respondents had submitted "a copy" -7-

of the Consent Terms. In such circumstances, we are unable to persuade

ourselves to find error with the impugned order where the learned Member

(Judicial) has recalled Ex- parte dated 22nd December, 2014 and directed that

the Company Petition should be listed for hearing.

We did not find any substance in this appeal the same is rejected. No

order as to costs.

(Justice A.I.S. Cheema) Member (Judicial)

(Justice Bansi Lal Bhat) (Member (Judicial)

(Balvinder Singh) Member (Technical) sh/nn