M/S A P Refinery Pvt Ltd & Ors vs Aar Kay Chemicals Pvt Ltd & Ors

(Arising out of the Order dated 03.06.2022 passed by the National Company Law Tribunal, Chandigarh Bench in Execution Application - CA No.722/2019 in Company Petition No.146/ND/2012 (RT CP No.27/CHD/PB/2016)

In the matter of:

1. M/s. A.P. Refinery Pvt. Ltd. Village TaparHarnia, Nakodar Road, Jagraon - 142026 Distt. Ludhiana, Punjab ...Appellant No.1

2. M/s. Dhuri Cold Storage Pvt. Ltd. 17-18-19, Apex Nagar Near Easy Day, Barewal Road, Ludhiana - 141001 ...Appellant No.2

3. Ravi Nandan Goyal 17-18-19, Apex Nagar Barewal Road, Near Easy Day, Ludhiana - 141001 ...Appellant No.3

4. Shiv Kumar Goyal, B-35-951/45/7-1, Shivalik Enclave Barewal Road, Near Easy Day, Ludhiana - 141001, Punjab ...Appellant No.4

5. Bhuwan Goyal 17-18-19, Apex Nagar Barewal Road, Near Easy Day, Ludhiana - 141001 ...Appellant No.5

6. Arun Kumar Goyal 17-18-19, Apex Nagar Barewal Road, Near Easy Day, Ludhiana - 141001 ...Appellant No.6

7. Anu Buildwell Pvt. Ltd. 18, Chander Lok Enclave, 2

Pitam Pura New Delhi - 34 ...Appellant No.7

8. Ms. Anita Rani, B-35-951/45/7-1, Shivalik Enclave Barewal Road, Near Easy Day, Ludhiana - 141001, Punjab ...Appellant No.8

9. Ms. Kusum Garg, Gali No.3, Talwandi Road, Raikot, Punjab ...Appellant No.9

10. Mr. Pratul Goyal, House No.153, Punjabi Bagh, Patiala ...Appellant No.10

Versus

1. AAR KAY Chemicals Pvt. Ltd. Village Saroud, Ludhiana Road, Malerkotla - 148023 ...Respondent No.1

2. Mr. Achhru Ram Sharma Son of Late Mr. Karam Chand, 349, A.P. Enclave, Dhuri - 148024 ...Respondent No.2

3. Mr. Pawan Kumar Singla, Son of Late Mr. Miri Mal, Kothi Opp. P.S.E.B. M.K. Road, Dhuri - 148024 ...Respondent No.3

4. Mr. Vijay Kumar Goyal, Son of Late Mr. Payare Lal, 16B-146/6, Yash Chaudhary Market Dhuri - 148024 ...Respondent No.4

5. Mr. ParshotamDass Garg, Son of Late Mr. Jagan Nath, 352, A. P Enclave, Dhuri - 148024 ...Respondent No.5

Company Appeal (AT) No.102 of 2022 3

6. M/s Kaveri Shilpkala Limited TU-[19, 2ND Floor, Pitampura, New Delhi - 110019 ...Respondent No.6

7. M/s Rajasthan Plantation Co. Ltd. 4858, Sham Nagar, Ludhiana - 141001 ...Respondent No.7

8. Mrs. Rita Singla, Wife of Mr. Pawan Kumar Singla Kothi Opp. P.S.E.B. Malerkotla Road, Dhuri - 148024 ...Respondent No.8

9. Mr. Dev Raj, Son of Mr. Miri Mal, Kailash Oil Mills, Dhuri - 148024 ...Respondent No.9

10. Registrar of Companies, Corporate Bhawan, Plot No.4-B, Sector 27-B, Madhya Marg, Chandigarh - 160019 ...Respondent No.10

11. Regional Director B-2 Wing, 2nd Floor, Paryavaran Bhawan, CGO Complex, New Delhi - 110003 ...Respondent No.11

Present

For Appellants : Mr. Arnav Kumar & Mr. Mudit Gupta, Advocates

For Respondents : Mr. Sudhir K. Makkar, Sr. Advocate along with Ms. Tushita Ghosh, Mr. Sarojanand Jha, Ms. Renu Gupta, Mr. Rohit, Ms. Rajreeta Ghosh & Mr. Rahul Kumar, Advocates

Company Appeal (AT) No.102 of 2022 4

JUDGEMENT

(06.05.2024)

NARESH SALECHA, MEMBER (TECHNICAL)

This Appeal has been filed under Section 421 of the Companies Act, 2013

challenging the Impugned Order dated 3rd June, 2022 passed by National

Company Law Tribunal, Chandigarh Bench (in short, the Tribunal) in the

Execution Application filed by the Respondent Nos.1 to 9 herein being Company

Application No.722/2019 in Company Petition No.146/ND/2012 (RT CP

No.27/Chd/Pb/2016).

2. Heard the Counsel for the parties and perused the record made available

including cited judgements.

3. The Execution Application CA No.722 of 2019 was filed by the

Respondents No.1 to 9 seeking enforcement of Order dated 16th April, 2019

passed by this Appellate Tribunal in Company Appeal No.394 of 2017 and

Company Appeal No.55 of 2018. These Company Appeals were filed by the

Respondents No.1 to 9 and the Appellants respectively against the final Order

dated 15th November, 2017 passed by the Tribunal, Chandigarh in CP

No.146/ND/2012 being oppression and mismanagement petitions filed by the

Respondents No.1 to 9 against the Appellants under Section 397, 398, 237(b)

and 111(4)(a)(ii) of the Companies Act, 1956. It has been alleged by the

Appellants that Impugned Order wrongly concluded that Appellants herein have

Company Appeal (AT) No.102 of 2022 5

not complied with this Tribunal Order under execution dated 16th April, 2019. It

is further case of the Appellants that the Appellant No.1 vide Board Resolution

dated 24.11.2017 and 10th May, 2019 had already complied with the directions

passed by the Tribunal in Order dated 15.11.2017 by this Appellate Tribunal in

the Order dated 16.4.2019 and therefore there was error in the Impugned Order

to this effect. The Appellants stated that the Tribunal has misinterpreted this

Appellate Tribunal's Order dated 16.4.2019 and passed wrong Impugned Order.

4. The Appellants brought out that on 1st August, 2003, the Appellant No.1

Company was incorporated and is engaged in the business of manufacturing

and supply of refined rice bran oil. The Appellants stated that in the year 2009

they held approximately 88.70% of equity shares of the Company and

Respondent No.1 to 9 held around 11.30% of equity shares. It was brought to

the notice that the Appellants contributed Rs.6,96,70,000/- (88.7%) towards

equity capital whereas the RespondentsNo.1 to 9 collectively contributed

Rs.88,45,000/- (11.31%).

5. The Appellants clarified that on 19.5.2010, Respondent No.1 Company

purchased 14,96,000 shares of Appellant No.1 Company from the five

investment companies and the same is reflected in the register of members of

the Appellant No.1 Company at Serial No.16 to 20 and the said transfer dated

19.5.2010 from the five investment companies to the Respondent No.1 Company

is called as "First Transfer".

Company Appeal (AT) No.102 of 2022 6

6. The Appellants further submitted that on 24.05.2010, the Respondent

No.1 Company transferred the 14,96,000 shares to the Appellant No.2 Company

and the same was reflected in the register of members of the Appellant No.1

Company at Serial No.21 and is referred in the present case as "Second

Transfer". It has been submitted that in November 2012, the Respondent No.1

to 9 herein filed Company Petition against the Appellants under Section 397,

398 and 111 of the Companies Act, 1956 in CP No.146/ND/2012 alleging

oppression and mismanagement regarding the affairs of Appellant No.1

Company and challenged the transfer of 14,96,000 shares of Appellant No.1

Company from Respondent No.1 Company to Appellant No.2 Company on

24.5.2010. In the said Petition, the RespondentsNo.1 to 9 also challenged

allotment of 3,50,000 shares by Appellant No.1 Company to the Appellant No.7

on 29.6.2011 (Allotment No.1) and allotment of 4,00,000 shares by the

Appellant No.1 Company to Appellant No.2, 3, 8, 9 and 10 on 10.10.2012

(Allotment No.2).

7. It was submitted that the Tribunal vide its Judgement dated 15.11.2017,

disposed Company Petition No.146/ND/2012, inter alia, setting aside the second

transfer and directed the Appellants to transfer back 14,96,000 shares to

Respondent No.1 Company. It was brought to the notice of this Appellate

Tribunal that the detailed directions were contained in para - 161 of the

Tribunal's Order dated 15.11.2017, especially, para- 161(ii) contained direction

Company Appeal (AT) No.102 of 2022 7

of transfer of 14,96,000 shares to the Respondent No.1 which was to be with

prospective effect from 15.11.2017 and the second transfer of 24.5.2010 was

primarily declared invalid by the Tribunal on the ground that the supporting

board resolution in respect of the second transfer was not produced. The

Appellants stated that, under protest and without prejudice, it transferred

14,96,000 shares to the Respondent No.1 Company w.e.f. the date of Judgement

dated 15.11.2017 and transferred date was recorded in the list of transfers in

the Register of Members of Appellant No.1 Company at Sl. No.24 and Board

Resolution was passed in this respect on 24.11.2017. The Appellants also

claimed that they complied with directions contained in para - 162 (iii) to (vi) of

the Tribunal Order dated 15.11.2017 by sending offer letter to Respondent No.2

to 9 of offer them proportionate shares from allotment made by the Appellant

No.1 Company in the year 2011 and 2012. However, the same was not accepted

by Respondent No.2 to 9.

8. The Appellants stated that both the Appellants and the RespondentsNo.1

to 9 challenged the Order of the Tribunal dated 15.11.2017 before this Appellate

Tribunal by way of two different Appeals. The Respondents No.1 to 9 challenged

the Order in Company Appeal No.394/2017 and the Appellants also challenged

the Tribunal Order dated 15.11.2017 vide Company Appeal No.55 of 2018.

9. The Appellants claimed that in the meantime on 27.11.2017, the

Respondent No.1 Company vide Board Resolution, authorized sale of 14,96,000

Company Appeal (AT) No.102 of 2022 8

shares of Appellant No.1 Company to the Appellant No.2 Company which was in

conformity with the Settlement-Cum-Exit-Arbitral Award dated 12.7.2017. It has

been stated that on 28.11.2017, the Appellant No.2 Company vide Board

Resolution dated 28.11.2017 again authorized purchased of 14,96,000 shares

from the Respondent No.1 Company for a consideration of Rs.15,10,960/-.

10. The Appellants clarified that acting on the Board Resolution dated

27.11.2017 and 28.11.2017 passed by the Respondent No.1 Company and

Appellant No.2 Company respectively, a separate share purchase agreement was

executed between the Respondent No.1 Company and the Appellant No.2

Company for sale/purchase of 14,96,000 shares of Respondent No.1 Company

and a fresh transfer deed dated 28.11.2017 was also executed between the

parties and further pointed out that a fresh transfer on 28.11.2017 was a new

and completely separate independent transaction which was made pursuant to

Board Resolution dated 27.11.2017 and 28.11.2017 in the Respondent No.1

Company and the Appellant No.2 Company and has got no connection with the

earlier second transfer dated 24.5.2010 which was challenged by the

Respondents No.1 to 9 in earlier proceeding in CP No.146/ND/2012. The

Appellants stated that on 29.11.2017, the Appellant No.1 Company after Board

Resolution duly recorded in its register of members, fresh transfer of 14,96,000

shares from Respondent No.1 Company to Appellant No.2 Company and it

Company Appeal (AT) No.102 of 2022 9

reflected in the register of members of Appellant No.1 Company at Sl. No.28

(Termed as "FRESH TRANSFER").

11. The Appellants have highlighted that all directions were complied and

steps were taken to issue the fresh transfers, without prejudice with the rights

of the Appellants to challenge the Tribunal's Order dated 15.11.2017 and the

same was specifically mentioned in Clause - 5 of the share purchase agreement

dated 28.11.2017 according to which in case Appellants succeed in the Appeal

that the Respondent No.1 Company would be liable to return the sale

consideration.

12. The Appellants submitted that pursuant to fresh transfer of28.11.2017,

the Register of Members of Appellant No.1 Company reflected the ownership of

14,96,000 shares as under:-

"

Transfer Date Event Owner of No. 14,96,000 shares 16-20 19.05.2010 Transfer of 14,96,000 R1 shares from five (Aar Kay investment companies Chemicals) to R1 21 24.05.2010 Transfer of 14,96,000 A2 (Dhuri shares from R1 to A2 Cold Storage)

24 15.11.2017 Date of NCLT R1 (Aar Kay Judgment Chemicals)

Company Appeal (AT) No.102 of 2022 10

28. 28.11.2017 Fresh Transfer Deed A2 (Dhuri again transferring Cold 14,96,000 shares from Storage) R1 to A2

"

13. The Appellants further submitted that Respondent No.5 i.e. Mr. Parshotam

Dass Garg, as shareholder of Respondent No.1 Company - AARKAY Chemicals

Pvt. Ltd., filed a fresh Company Petition under Section 241, 242 of the

Companies Act, 2013 being CP No.276 of 2017 alleging oppression and

mismanagement regarding the affairs of Respondent No.1 Company and

challenged the validity of Board Resolution dated 27.11.2017 passed by

Respondent No.1 Company which authorized fresh sale of 14,96,000 shares and

alleged that the Board Resolution was in violation of Section 188 of the

Companies Act, 2013 and also transfer deed dated 28.11.2017 was not

supported by Board Resolution. The Appellants clarified that this Company

Petition No.276/2017 is still pending adjudication before the Tribunal and it was

also clarified that the said CP No.276/2017 came up for hearing before the

Tribunal on 13.12.2017 on which date the Tribunal restrained the Appellant

No.2 from further alienating or transferring these 14,96,000 shares.

14. The Appellants further elaborated that in January, 2018, the Respondent

Nos.1 to 9 herein as shareholders of Appellant No.1 Company also filed a fresh

Company Appeal (AT) No.102 of 2022 11

Company Petition No.24/2018 under Section 241, 242 of the Companies Act,

2013 alleging oppression and mismanagement regarding the affairs of the

Appellant No.1 Company and further challenged the fresh transfer of 14,96,000

as fresh transfer on 28.11.2017 which is also pending adjudication before the

Tribunal. The Appellants emphasised that the fresh transfer of 14,96,000 shares

on 28.11.2017 was neither subject matter of challenge in CP 146/ND/2012 nor

was subject matter of Company Appeal No.394/2017 or Company Appeal

No.55/2018 in which the Order dated 16th April, 2019 was passed, and,

therefore, at the best, fresh transfer of 28.11.2017 can be treated as fresh cause

of action which is still sub-judice before the Tribunal in CP No.276/2017 and CP

No.24/2018.

15. The Appellants have stated that on 16.4.2019, this Appellate Tribunal vide

its Orders dismissed Company Appeal No.55/2018 filed by the Appellants and

allowed the Company Appeal filed by the RespondentsNo.1 to 9 i.e. CA

No.394/2017.

16. The Appellants submitted that with respect to challenge to the second

transfer of 24.5.2010, this Appellate Tribunal modified the Order dated

15.11.2017 passed by the Tribunal to the extent that instead of "transferring

back" the 14,96,000 shares to the Respondent No.1 Company but it set aside

the transfer of 14,96,000 shares retrospectively w.e.f. 24.5.2010 and this

Appellate Tribunal never made any mention about fresh transfer dated

Company Appeal (AT) No.102 of 2022 12

28.11.2017 in the said Order dated 16.4.2019. Thus, the direction of this

Appellate Tribunal was that in the list of transfers in the register of members of

the Appellant No.1 Company regarding entry at Sl.No.21 and 24 would have to

be omitted and 14,96,000 shares would stand registered in the name of R1

Company w.e.f. 19.5.2010.

17. The Appellants conceded that they challenged the Order of this Tribunal

dated 16.4.2019 before the Hon'ble Supreme Court by filing Civil Appeal No.4774

- 4775 of 2019 which is still pending before the Hon'ble Supreme Court of India.

18. In this background, the Appellants pointed out that this Tribunal in Order

dated 16.4.2019 did not reflect the present ownership of 14,96,000 shares as on

28.11.2017 and the Respondent No.1 Company vide fresh transfer deed had

independently transferred these 14,96,000 shares to the Appellant No.2

Company. On 10.8.2019, the Respondents No.1 to 9 vide their letter dated

10.8.2019 requested the Appellants to comply with this Appellate Tribunal's

Order dated 16.4.2019 and the Appellant No.1 Company replied vide letter dated

19.8.2019 stating that it has complied with the Order of this Appellate Tribunal

and not satisfied with this, the Respondent No.1 to 9 filed Execution Application

in October, 2019 before the Tribunal being CA No.722 of 2019 seeking

enforcement of this Tribunal's Order dated 16.4.2019 passed in Company Appeal

No.55 of 2018 and Company Appeal No.394 of 2017, without mentioning the

facts regarding subsequent fresh transfer on 28.11.2017.

Company Appeal (AT) No.102 of 2022 13

19. It is the case of the Appellants that tribunal after hearing the party passed

the Impugned Order dated 3rd June, 2022 where it wrongly held that Appellants

have not complied with the directions passed by this Tribunal in its Order dated

16.4.2019. The Appellants alleged that the Tribunal erred in wrong

interpretation of this Appellate Tribunal's Order dated 16.4.2019 and passed the

Order contrary to this Tribunals' Order and in fact made out a new case and new

decree beyond the jurisdiction of the executing Court.

20. It is the case of the Appellant that the Impugned Order wrongly observed

that even if shares were transferred by Respondent No.1 Company to the

Appellant No.2 Company on 28.11.2017, then also the shares have to be

transferred back in the name of the Respondent No.1 Company in pursuant to

the Order dated 16.04.2019 of this Appellate Tribunal. The Appellant claimed

that there was no such direction in the Order dated 16.04.2019 passed by this

Appellate Tribunal and this Appellate Tribunal only directed the Appellant No.1

Company to rectify the register of members so as to reflect 14,96,000 shares

standing in the name of Respondent No.1 Company w.e.f. 19.05.2010 and not

from 15.11.2017. The Appellant further argued that the Order of this Tribunal

dated 16.04.2019 did not take into cognizance of the subsequent fresh transfer

dated 28.11.2017 nor it directed the Appellant No.1 Company to reflect the

Respondent No.1 Company at present owners of the 14,96,000 shares and

furthermore it did not prohibit the Respondent No.1 Company from transferring

Company Appeal (AT) No.102 of 2022 14

14,96,000 shares to the Appellant No.2 Company in future. The Appellant,

therefore, pleaded that directions passed by the executing Court vide Impugned

Order to return back the share certificates to the Respondent No.1 Company are

illegal and perverse and need to be set aside as it completely ignored the fact that

the subsequent fresh transfer of 28.11.2017 was beyond the scope of the original

decree/original proceedings.

21. The Appellant emphasised that, under protest and without prejudice to

their rights and contentions in the Civil Appeal pending before the Hon'ble

Supreme Court, the Appellant have complied with direction passed by the

Tribunal in the Order dated 15.11.2017 and the Order of this Appellate Tribunal

contained in Order dated 16.04.2019 and also rectified the register of members

in accordance with the direction passed by the Tribunal as well as this Appellate

Tribunal.

22. The Appellant further stated that the Tribunal did not appreciate the

reason that 14,96,000 shares stand in the name of the Appellant No.2 Company

is because of the fresh share transfer of 28.11.2017 which was independent

cause of Respondent No.1 Company to retransfer 14,96,000 shares to Appellant

No.2 Company by way of fresh transfer deed, which incidentally was not subject

matter of Company Petition No. 146/ND/2012 or Company Appeal No.397 of

2017 or Company Appeal No.55 of 2018 and therefore the question of this

Company Appeal (AT) No.102 of 2022 15

Appellate Tribunal setting aside the subsequent fresh transfer of 28.11.2017 did

not arise.

23. The Appellant emphasized that the specific directions contained in para

161(ii) to (vi) of the Order dated 15.11.2017 of the Tribunal were complied and

there was no direction to the Respondent No.1 Company prohibiting retransfer

of 14,96,000 shares to the Appellant No.2 Company, which was done through

fresh transfer on 28.11.2017 which was complete separate transactions and was

done pursuant to Board Resolution dated 27.07.2017 and 28.7.2017passed by

Respondent No.1 Company and Appellant No.2 Company respectively and also

in accordance with share purchase agreement dated 28.11.2017. The Appellants

emphasized that the subsequent fresh transfer of 14,96,000 shares has no

connection with the transfer of 24th May, 2010 which was challenged by the

Respondent in CP 146/ND/2012.

24. It is the case of the Appellants that the Tribunal misinterpreted this

Tribunal's Order dated 16.04.2019, especially, contained in para - 40(A) where

this Tribunal held that "steps taken by the party pursuant to such directions"

include the fresh transfer dated 28.11.2017 despite the fact that the fresh

transfer was not deliberated by the Appellate Tribunal. It is the case of the

Appellant that this Appellate Tribunal vide Order dated 16.04.2019 merely

directed the Appellant No. 1 Company to ignore the Second Transfer of

24.05.2010 and rectify the Register of Member so as to reflect 14,96,000 shares

Company Appeal (AT) No.102 of 2022 16

standing in the name of Respondent No. 1 Company w.e.f. from 19.05.2010, and

not from 15.11.2017. The Appellants stated that this Appellate Tribunal in its

Order dated 16.04.2019 does not take cognizance of the subsequent Fresh

transfer of 28.11.2017; nor does it direct the Appellant No. 1 Company to reflect

Respondent No. 1 Company as present owner of these 14,96,000 shares; and

nor does it prohibit the Respondent No. 1 Company from transferring the

14,96,000 shares to the Appellant No. 2 Company in future. Therefore, directions

passed by the Executing Court vide the Impugned Order to reflect Respondent

No. 1 Company as present owner of the 14,96,000 shares or to return back the

share certificates to the Respondent No. 1 Company, are liable to be set aside.

25. The Appellants submitted that the Appellant No. 1 Company had rectified

its Register of Member and other relevant records to reflect cancellation/setting

aside of the allotment of 3,50,000 shares to Appellant No. 2 on 29.06.2011 and

allotment of 4,00,000 shares on 10.10.2012 to Appellant No.2, 3, 8, 9 and 10 in

terms of directions recorded at Para 40(C) of the order dated 16.04.2019 passed

by this Appellate Tribunal.

26. The Appellants stated that the Tribunal wrongly noted that the

Respondent No. 1 never received back the share certificates for 14,96,000 shares

in pursuance of Order dated 16.04.2019, without appreciating the fact that there

is no direction in the Appellate Tribunal's order with respect to the Share

Certificates, moreover, the Appellant No. 1 Company has never issued any

Company Appeal (AT) No.102 of 2022 17

physical share certificates to any of its shareholders. As such, there was no

question of delivering back the Share Certificates to the Respondent No. 1

Company.

27. Concluding pleadings, the Appellants requested to allow their Appeal and

set aside the Impugned Order.

28. Per contra, the Respondent stated that the pleadings of the Appellants are

baseless, mischievous and misleading and submitted that the Adjudicating

Authority, after going through all the records and the legal issues, passed the

reasoned impugned order which is free from any error whatsoever.

29. It has been pleaded by the Respondents No.1 to 9 that Appellants have not

complied with the Order dated 16.4.2019 since as per list of shareholders filed

by the Appellant on 21.11.2019 along with Form MGT 7 in 2018-2019;

14,96,000 shares stand in the name of Appellant No.2 and not in the name of

Respondent No.1.It is the case of the Respondent that since subsequent transfer

of 28.11.2017 was step taken by the Appellants pursuant to direction contained

in para - 161 (ii) and (vi) of the Tribunal Order dated 15.11.2017, therefore, the

same has been specifically and clearly set aside by this Appellate Tribunal in its

Order dated 16.4.2019. It is the case of the Respondents No.1 to 9 that the

Appellant No.1 Company should have omitted transfer No.28 from the register

of members and should have shown 14,96,000 shares in the name of

Respondent No.1 Company and not in the name of Appellant No.2 Company.

Company Appeal (AT) No.102 of 2022 18

30. The Respondents No.1 to 9 stated that the pleading of the Respondents

No.1 to 9 was accepted by the Tribunal as contained in para - 23 to 26 of the

Impugned Order and concluded that Appellants have not complied with this

Tribunal Order dated 16.4.2019 and directed the Appellants to transfer back the

share certificate to Respondent No.1.

31. The Respondents No.1 to 9 submitted that there has been chequered

history of the case which has seen several rounds of litigations and the Orders

of the Tribunal as well as this Appellate Tribunal has gone against the Appellants

and supported the Respondents No.1 to 9. The Respondents No.1 to 9 further

submitted that it is only for the compliance of the Orders of the Tribunal as well

as this Appellate Tribunal, the Respondents No.1 to 9 moved for execution

Orders and the Impugned Order was passed accordingly in the Tribunal.

32. The Respondent alleged that they have been facing oppression and

mismanagement almost since 12 years as they filed the original Petition

No.146/ND/2012 in October, 2012 challenging the reduction of their

shareholding in the Appellant No.1 Company to 9.52%through illegal transfer of

14,96,000 shares of Respondent No.1 to Appellant No.2 Company purportedly

made on 24.5.2010 and illegal allotment of 3,50,000 shares on 29.6.2011 and

4,00,000 shares on 10.10.2012 to the Appellants group which was without

consent of the Respondents No.1 to 9.

Company Appeal (AT) No.102 of 2022 19

33. The Respondent alleged that the Appellant No.3 - Ravi Nandan Goyal and

Appellant No.4 - Shiv Kumar Goyal who are on Board of Directors of all the

relevant companies i.e. Respondent No.1 Company (AAR KAY Chemicals Pvt.

Ltd.) purported transferor), Appellant No.2 Company - Dhuri Cold Storage Pvt.

Ltd. (purported transferee) and Appellant No.1 - A.P. Refinery Pvt. Ltd., it is the

case of the Respondents No.1 to 9 that the fraudulent transfer of 14,96,000

shares illegal transfer was caused by Respondent No.1 company to the Appellant

No.2 Company, which was facilitated by Appellant No.3 and Appellant No.4 at a

time when the Respondents No.1 to 9 herein held clear majority shares in the

Respondent No.1 Company.

34. The Respondents No.1 to 9 stated that the Tribunal vide Order dated

15.11.2017 after hearing all the parties came to the clear conclusion regarding

oppression and mismanagement being done by the Appellants and set aside the

illegal transfer of 14,96,000 shares from Respondent No.1 Company to Appellant

No.2 Company. The Respondents No.1 to 9 submitted that cross appeals were

filed by both the Respondents No.1 to 9 and the Appellants before this Appellate

Tribunal against the Tribunal's Order dated 15.11.2017 i.e. CA(AT) 294/2017

filed by Respondent No.1 to 9 on 28.11.2017 and Company Appeal (AT) 55/2018

was filed by the Appellants.

It is the case of the Respondents No.1 to 9 that during this interregnum

period and after passing of the Order by the Tribunal on 15.11.2017 i.e. from

Company Appeal (AT) No.102 of 2022 20

24.11.2017 to 28.11.2017, the Appellants No.3 and 4 illegally and only on paper

allegedly transferred 14,96,000 shares from Appellant No.2 to Respondent No.1

on 24.11.2017 and within four days of this transfer again on 28.11.2017

retransferred the same back to Appellant No.2 and again registered shares of

Respondent No.1 to Appellant No.2 by fabricating documents in violation of

Section 188 of Companies Act, 2013.

35. The Respondents No.1 to 9 emphasized that all these facts were brought

to the notice of this Appellate Tribunal through pleadings and arguments by both

the parties and, therefore, this Appellate Tribunal was very conscious and

cognizant of these facts including the fact that the Appellant allegedly

purportedly transferred the shares to Appellant No.2 only on papers based on

forged documents and thereafter this Appellate Tribunal vide its Order dated

16.4.2019 gave clear directions.

36. The Respondents No.1 to 9 further reiterated that this Appellate Tribunal

was made aware of the illegal acts of the Appellant after the Order of the Tribunal

dated 15.11.2017 regarding alleged paper transfers and this Appellate Tribunal

set aside all the steps taken by the parties pursuant to the order of the Tribunal

dated 16.11.2017 vide suitable directions as contained in para - 40, where it

was clearly indicated that "any steps taken by the party pursuant to such

directions" recorded in para - (ii) to (vi) pending Appeal shall stand set aside."

Company Appeal (AT) No.102 of 2022 21

37. It is the case of the Respondents No.1 to 9 that this Appellate Tribunal

held that 14,96,000 shares would be shown in the name of Respondent No.1

Company w.e.f. 19.5.2010 and thus in effect set aside the fresh allotment of

shares of the Appellants on 29.6.2011 and 10.10.2012 along with fresh transfer

of 28.11.2017 and imposed cost on the Appellant Directors.

38. The Respondents No.1 to 9 disputed the claims of the Appellants that they

did not press for the stay in the Hon'ble Supreme Court and submitted that

Appellant in fact filed I.A. No.78176 of 2019 for ex-parte stay on operation of this

Appellate Tribunal's Order dated 16.4.2019,however, Hon'ble Supreme Court of

India vide Order dated 10.5.2019 did not grant any stay of operation of the

Judgement of this Appellate Tribunal and in absence of any stay and also

keeping in view the fact that the Appellant had not implemented the Orders dated

16.4.2019, Respondent No.1 to 9 on 6.9.2024 filed an Application before the

Tribunal under Section 424(3) of the Companies Act, 2013 for execution and

enforcement of the order passed by this Appellate Tribunal.

39. The Respondent elaborated that during the Execution Petition, the

Tribunal called for report from ROC, Punjab and Chandigarh who filed its report

dated 14th January, 2020 clearly advising regarding non-compliance by the

Appellants of this Appellate Tribunal's Orders dated 16.4.2019 and based on

such report of the ROC, the Tribunal passed the Impugned Order dated 3.6.2022

allowing the Execution Petition and directed ROC to appoint a Gazetted Officer

Company Appeal (AT) No.102 of 2022 22

to ensure strict compliance of this Tribunal's Order dated 16.4.2019 and to verify

and ensure that the Appellant No.1 Company had rectified its register of

members so as to reflect 14,96,000 shares in the name of Respondent No.1

Company. The Tribunal also passed necessary direction for payment of cost by

the Appellant Directors from their own funds to the Respondents No.1 to 9.

40. The Respondents No.1 to 9 submitted that during the hearing of the

present Appeal, a status quo Order was passed by this Appellate Tribunal on

7.7.2022 in the present Appeal, therefore, the direction contained in this

Appellate Tribunal's earlier Order dated 16.4.2019 are yet to be implemented

even after four years of the Orders of this Appellate Tribunal, which in fact

tantamount that Appellants despite losing the legal battle in various legal Fora

still enjoy the status of the majority shareholders in the Appellant No.1

Company.

41. The Respondents No.1 to 9 submitted that this Appellate Tribunal's Order

dated 16.4.2019 has already been challenged by the Appellants but could not

succeed in getting a stay and as such there is no legal embargo in execution of

the Orders of this Appellate Tribunal which has correctly been passed by the

Tribunal in the Impugned Order as Execution Court and, therefore, the

Execution Court has not gone beyond the decree i.e. the Judgement dated

16.4.2019 by this Appellate Tribunal.

Company Appeal (AT) No.102 of 2022 23

42. The Respondent submitted that Executing Court i.e. the Tribunal has

powers and jurisdiction to interpret the decree for ensuring proper authority and

decree and in case any ambiguity found then the Executing Court is required to

look into the true import of such decree and cited the Judgement of "Raj Kumar

vs. Harbans Lal, AIR 1978 P&H 186", "Laxmidhar Sahu Vs. Smt. Padmini

Tripathy and others, AIR 1991 Ori 9", Bhavan Vaja and others vs. Solanki Hanuji

Khodaji Mansang and Another, AIR 1972 SC 1371", "Manish Mohan Sharma and

Others v. Ram Bahadur Thakur Limited and Others, (2006) 4 SCC 416", Justice

(RTD.) Shambhu Singh and Ors. vs. Union of India and Ors., 2020 ILR (M.P.) 2804), "Jai Narain Ram Lundia v. Kedar Nath Khetan and Ors., 1956 SCR 62",

"Brakewel Automotive Components (India) Pvt. Ltd. v. P.R. Selvam Alagappan,

2017 (5) SCC 371", "Rajinder Kumar v. Kuldeep Singh and Ors. 2014 (15) SCC

529", "Desh Bandhu Gupta v. N.L. Anand & Rajinder Singh,

MANU/SC/0562/1994", "Hira Devi and others v. Harinath Chaurasia and

others, AIR 1989 ALL 11 at p 13", in support of their arguments.

43. The Respondents No.1 to 9 submitted that the Appellants have failed to

comply with Appellate Tribunal's Order dated 16.4.2019 and the same fact has

been elaborated by the ROC and further the register of members of the Appellant

No.2 Company does not reflect the name of Respondent No.1 Company even on

date i.e. after this Tribunal's Order dated 16.4.2019, holding14,96,000 shares.

Company Appeal (AT) No.102 of 2022 24

44. The Respondents No.1 to 9 also alleged that no share certificate has been

handed over to the Respondent No.1 company in pursuant to direction contained

in this Appellate Tribunal's Order dated 16.4.2019.

45. The Respondent further mentioned that subsequent transfer dated

28.11.2017 regarding transfer of 14,96,000 shares from Respondent No.1

Company to Appellant No.2 Company was specifically set aside by this Appellate

Tribunal and the pleadings of Respondents No.1 to 9 were acknowledged by this

Appellate Tribunal and therefore this Appellate Tribunal in the common Order

dated 16.4.2019 recorded the correct position in para - 23. Further, this

Appellate Tribunal also observed in para - 30 of the Order dated 16.4.2019 to

show Respondent No.1 as shareholders of 14,96,000 shares w.e.f. 19.5.2010 as

if shares were never transferred to Appellant No.2.

46. The Respondents No.1 to 9 submitted that this Appellate Tribunal was

aware of the fact that subsequent retransfer of 14,96,000 shares were pursuant

to direction contained in para - 161(ii) and observation in para - 158 of the Order

dated 15.11.2017 passed by the Tribunal and accordingly this Appellate

Tribunal, in the background of above Orders of the Tribunal, set aside all the

steps taken by the parties pursuant to directions recorded in para - 161(ii) to

(vi). This Appellate Tribunal in para - 40(B) issued fresh direction to the

Appellant No.1 to rectify the register of members so as to reflect 14,96,000 shares

standing in the name of Respondent No.1 Company w.e.f. 19.5.2010.

Company Appeal (AT) No.102 of 2022 25

The Respondent submitted that as a consequence to subsequent transfer

dated 28.11.2017 regarding alleged illegal transfer of 14,96,000 shares from

Respondent No.1 company to Appellant No.2 Company, there were no choice left

with the RespondentsNo.1 to 9 but to file the Company Petitions before the

Tribunal and accordingly, Company Petition No.276(CHD) of 2017 and Company

PetitionNo.24(ND) of 2018 were filed and therefore filing of the fresh Company

Petitions does not come in way regarding Execution Order passed by the

Tribunal.

47. Concluding their arguments, the Respondents No.1 to 9 submitted that

the Appeal may be dismissed with exemplary cost since the Respondents No.1

to 9 have been deprived of their rights despite getting all the favourable decisions

from the Tribunal as well as this Appellate Tribunal.

48. We will now examine various issues discussed in preceding discussions.

49. At this stage, we will like to reproduce relevant portions of the Tribunal's

Order dated 15.11.2017 as contained in para - 161 which reads as under:-

"161. From the discussion made above, it is found that the facts of the case would attract the provisions of Section 397 of the Companies Act, 1956, but winding up would unfairly prejudice the members. The instant petition is disposed of with the following directions:-

i) CA No. 255 of 1015 filed by the respondents is dismissed;

Company Appeal (AT) No.102 of 2022 26

ii) 14,96,000 shares now existing in the name of R-2 company be transferred back in the name of P-1 and its name be entered in the register of members of R-1 company. At the same time, the amount of Rs.15,00,000/- shown in the account of P-1 Company towards loan to AP Oil Mills shall stand written off and the name of R-2 company be omitted from the register of members of R-1 company; and

iii) R-1 company shall hold fresh meeting of the Board of Directors offering the proportionate shares out of additional allotment of 3,50,000 shares in 2011 and 4,00,000 shares in 2012 respectively at the rates at which these were transferred to some of the respondents. The transfer shall be made in favour of the petitioners proportionately as per shares held by P-2 to P-9, on these petitioners offering to subscribe to these shares at the rates allotted to some of the respondents within the time to be allotted by R-1 company in the said meeting and they shall deposit the required amount with R -1 company; and

iv) Failing the petitioners to send the offer for allotment of proportionate shares as were held by them on the date of allotment of additional shares or in making payment, the Board of Directors of R-1 Company would be at liberty to decide against the said allotment of proportionate shares; and

v) Rest of the shares out of the additional allotment of 3,50,000 and 4,00,000 shares, will continue to be held by the respondents to whom the shares were allotted; and

vi) The petitioner No.1 is not to be offered any share in these additional shares on the basis of this order as P-1 company

Company Appeal (AT) No.102 of 2022 27

became the shareholder only on 19.05.2010. Rest of the prayers regarding mis-management on account of falsification of the accounts or siphoning of the funds and other reliefs are declined."

50. We will also revisit our earlier Order dated 16.4.2019. We would also like

to take into consideration the relevant portion of Order of this Appellate Tribunal

contained in Order dated 16.04.2019, especially, para - 40 which reads as

under:-

"(A) We do not disturb directions in para marked - 163 of the Impugned Order. We agree with the learned NCLT as regards operative direction - 'i' in para 161 of the Impugned Order that CA 255 of 2015 filed by the Respondents deserved to be dismissed. However, for reasons discussed above, we set aside rest of the operative Order as recorded in para - 161 of the Impugned Order and reasons recorded by NCLT in support of the same. Any steps taken by the parties pursuant to such directions recoded in para - ii to vi, pending Appeals shall stand set aside.

(B) For the above reasons, we set aside the second transfer dated 24.05.2010 recorded in the register of members in the record of OR1 transferring the shares of OP1 in favour of OR2. The Respondents will rectify the register of members so as to reflect 14,96,000 shares standing in the name of OP1 - Aar Kay Chemicals Pvt. Ltd. with effect from 19.05.2010, and the second transfer dated 24.05.2010 done shall stand ignored.

Company Appeal (AT) No.102 of 2022 28

(C) We find that the first allotment made on 29.06.2011 as well as the second allotment made on 10th October, 2012 were both illegal and are hereby struck down.

(D) The Company Petitions shall stand disposed accordingly.

(E) Original Respondents 3 to 5, each will pay costs of Rs.50,000/- to each of the Original Petitioners (Appellants of CA 394/2017), from their own funds."

51. We note that the first transfer occurring on 19th May, 2010 where the

Respondent No.1 Company purchased 14,96,000 shares from five investment

companies and this transfer was reflected in the list of transfers in the register

of members of the Appellant No.1 company at Serial No.16 to 20 which is termed

as "First Transfer" in the various petitions and the Appeal herein. This was

followed by the second transfer on 24th May, 2010 whereby the Respondent No.1

Company subsequently transferred exact number of shares i.e. 14,96,000 to

Appellant No.2 Company. This transfer was reflected in the list of transfers in

the register of members of the Appellant No.1 company at Serial No.21 and the

said transfer of 24th May, 2010 has ben referred as "Second Transfer" in various

petitions and the Appeal herein.

52. This was challenged by Company Petition No. CP 146/ND/2012 filed by

the RespondentsNo.1 to 9 herein challenging the validity of second transfer and

Company Appeal (AT) No.102 of 2022 29

the Tribunal in its Order dated 15th November, 2017 directed transfer back of

share to Respondent No.1 company.

53. The bone of contention is regarding subsequent fresh transfer which

occurred on 28th November, 2017 whereby the Respondent No.1 Company

retransferred the same exact number of shares to the Appellant No.2 Company

under alleged separate Board Resolution and alleged share purchase agreement

against which the Company Petition No.276/2017 and Company Petition

No.24/2018 were filed by the Respondents No.1 to 9 challenging the validity of

the Board Resolution and fresh transfers made thereon. We have noted that this

Appellate Tribunal in its Order dated 16th April, 2019 dismissed the Appellants'

Appeal and modified the Tribunal's Order allowing the Respondents No.1 to 9

Appeal, which was challenged by the Appellants herein before the Hon'ble

Supreme Court of India in Civil Appeal No.4774 - 4775 of 2019, however, no stay

was granted by Hon'ble Supreme Court of India and the same is still pending for

adjudication before the Hon'ble Supreme Court of India. We may reiterate that

the Tribunal vide its Order dated 15.11.2017 disposed the Company Petition

No.146/ND/2012 whereby the second transfer was set aside and directed to

transfer back 14,96,000 shares to Respondent No.1 company.

54. We note that the Order of the Tribunal dated 15.11.2017 was challenged

by both the Appellants and Respondents No.1 to 9 by cross Appeals before this

Appellate Tribunal. The Respondents No.1 to 9 preferred an Appeal before this

Company Appeal (AT) No.102 of 2022 30

Appellate Tribunal bearing Appeal No.394/2017 and similarly the Appellants

challenged vide Company Appeal No.55 of 2018.

55. It is the case of the Appellants that both the Tribunal as well as this

Appellate Tribunal have dealt only regarding second transfer dated 24.5.2010

and did not deal with the subsequent fresh transfer of 14,96,000 shares

transferring shares from the Respondent No.1 Company to Appellant No.2

Company allegedly done after passing proper Board Resolutions and share

purchase agreement by the concerned parties. We also note the plea of the

Appellant that they never issued any physical share certificate hence no physical

shares have been transferred in name of the Respondent No.1 company. The

Appellants have also claimed that since the fresh transfer dated 28.11.2017 were

not subject matter of any dispute before the Tribunal or this Appellate Tribunal,

they have legally transferred these shares and as such there could not have been

Execution Order in this regard. The Appellant has pleaded that in any case, the

Respondents No.1 to 9 have already challenged the fresh allotments of shares

before the Tribunal and is pending adjudication.

56. We note that there have been series of litigations between the Appellants

and the Respondents No.1 to 9 right from the Tribunal to this Appellate Tribunal

and up to level of the Hon'ble Supreme Court of India. We also observe that the

Tribunal gave its specific Orders after detailed Order contained in Order dated

15.11.2017 and this Appellate Tribunal upheld the Appeal of the Respondent

Company Appeal (AT) No.102 of 2022 31

and partially modified the Order of the Tribunal 15.11.2017. We have noted from

the Order contained in this Appellate Tribunal in para - 40, the five directions

were given, (which we have already discussed in detail in previous discussion).

57. The directions of this Appellate Tribunal were not to disturb directions

contained in para marked 163 of the impugned Order dated 15.11.2017 and also

agreed with the Tribunal with regard to operative directions contained in para -

161(i) i.e. "CA 255/2015 filed by the Appellants herein deserve to be dismissed."

However, this Tribunal after recording detailed reasons set aside rest of the

operative part as recorded in para - 161(ii) to (vi) of the Orders of the Tribunal

dated 15.11.2017. It is important to note that this Appellate Tribunal recorded

in para - 40(A) last line, which recorded that "any steps taken by the parties

pursuant to such directions recorded in para - (ii) and (vi), pending Appeals

shall stand set aside."

58. We have taken into consideration that the Order of this Appellate Tribunal

dated 16.4.2019 was challenged by the Appellants before the Hon'ble Supreme

Court of India in April, 2019. However, despite the application for stay by the

Appellants, no stay was granted by the Hon'ble Supreme Court of India and is

pending for adjudication before the Hon'ble Supreme Court of India.

In this background, the objection of the Appellants that the Tribunal

should not have gone ahead with the execution order since the Appellants have

Company Appeal (AT) No.102 of 2022 32

filed the Appeal before the Hon'ble Supreme Court of India, we note Order 41

Rule 5 of CPC which reads as under:-

"...........

5. Stay by Appellate Court (1) An appeal shall not operate as a stay of proceedings under a decree or order appealed from except so far as the Appellate Court may order, nor shall execution of a decree be stayed by reason only of an appeal having been preferred from the decree;

but the Appellate Court may for sufficient cause order stay of execution of such decree."

[Emphasis supplied]

59. Hence, it is clear that the Appeal does not operate as a bar on decree or

execution order except if ordered so by the superior Court. Thus, we are not

convinced with pleadings of the Appellants on this issue.

60. We note that the Tribunal before passing the Execution Orders has gone

through further objection of the Appellants and accorded clear finding in para -

21 of the Impugned Order:-

"After hearing both the parties and careful perusal of the order dated 16.04.2019, we are of the considered view that there are three cardinal points for determination before this Bench are as under:-

i) Whether the present execution application is not maintainable in view of pendency of appeal against

Company Appeal (AT) No.102 of 2022 33

order dated 16.04.2019 before the Hon'ble Supreme court?

ii) Whether applicant No.1 has itself transferred 14,96,000 shares to Dhuri Cold Storage Private Limited, respondent No.2? If so its effects?

iii) Whether respondents have already acted upon for implementation of order dated 16.04.2019?"

61. We further take into consideration that the issue framed in the Impugned

Order regarding maintainability of the Execution Petition pending adjudication

Civil Appeal before the Hon'ble Supreme Court was rejected in para - 22. Another

issue regarding Respondent No.1 itself transferred back 14,96,000 shares to

Appellant No.2 on 28.11.2017 was also discussed and rejected in para - 23 of

the Impugned Order by referring to para - 40(A) of this Appellate Tribunal on

16.4.2019. Third issue whether the Appellant has implemented completely

directions of this Appellate Tribunal dated 16.4.2019 was also discussed in full

in para - 25 and 26 of the impugned Order and concluded that the Appellants

were found to be non-compliance of the direction contained in Order dated

16.4.2019 under execution.

62. We note that there was no dispute regarding the first transfer of shares

dates 19th May, 2010. However, the second transfer dated 24.5.2010 was

challenged and was adjudicated by the Tribunal as well as this Appellate

Tribunal in terms of para - 40 of this Appellate Tribunal's Order dated 16.4.2019.

Company Appeal (AT) No.102 of 2022 34

The second transfer dated 24.5.2010 recorded in the register of members

transferred the shares in favour of Appellant No.2 was set aside and further

direction was given to the Appellant No.1 company to rectify the Register of

Members so as to reflect 16,94,000 shares standing in the name of Respondent

No.1 Company w.e.f. 19.5.2010 and second transfer dated 24.5.2010 shall stand

ignored.

63. This Appellate Tribunal also recorded in para - 40(C) that the first

allotment made on 19.6.2011 i.e. 3,50,000 shares and second allotment made

on 10th October, 2012 for 4,00,000 shares were declared as illegal and were

struck down. This Appellate Tribunal in 40(E) also imposed the cost of

Rs.50,000/- each on the original respondents Nos.3 to 5 each to pay to each of

the original petitioners (Appellant of CA 394/2017) from their own funds.

64. With these observations, the Company Petition was disposed.

65. It is important to note that this Appellate Tribunal in Para - 40(A) in the

last sentence very categorically stated that any steps taken by the party pursuant

to such directions recorded in para -(ii) to (vi) of para - 161 of the Tribunal

pending Appeal shall stand set aside.

66. We have already noted para - 161 of the Order of the Tribunal dated

15.11.2017 and held after detailed discussions that in terms of this Appellate

Tribunal's Order dated 16.4.2019, only para - 161(i) was allowed remining all

Company Appeal (AT) No.102 of 2022 35

directive contained in para - 161(ii) to (vi) were set aside. In effect, the status quo

as on 19th May, 2010 was allowed and all subsequent actions of the Appellants

in transferring shares were set aside.

67. We have noted that the Appellants pleaded that they have complied with

all the directives of the Tribunal as well as the Appellate Tribunal and submitted

that in the meantime on 27.11.2017, the Respondent No.1 company vide

separate new Board Resolution authorized sale of 14,96,000 shares of Appellant

No.1 company to the Appellant No.2 company and same was in conformity with

the Settlement-Cum-Exit-Arbitral Award dated 12.7.2017. It has been stated

that on 28.11.2017, the Appellant No.2 Company vide Board Resolution dated

28.11.2017 again authorized purchased of 14,96,000 shares from the

Respondent No.1 Company for a consideration of Rs.15,10,960/- and acting on

Board Resolution dated 27.11.2017 passed by the Respondent No.1 Company

and Board Resolution dated 28.11.2017 passed by Appellant No.2 Company, a

separate share purchase agreement was executed between Respondent No.1

company in the name of Appellant No.2 Company for sale and purchase of

14,96,000 shares of the Respondent No.1 company and therefore a fresh transfer

deed dated 28.11.2017 was also executed between the parties whereby

14,96,000 shares from the Respondent No.1 Company to the Appellant No.2

company on 28.11.2017 which is a case of fresh transfer (Fresh Transfer) and

there was no restriction by the Tribunal or this Appellate Tribunal and this

Company Appeal (AT) No.102 of 2022 36

transaction being completely new, separate and independent transaction was

valid as per the Appellants.

68. In this regard, we revisit the Order of the Tribunal. We also take into

account the discussion on the arbitral Tribunal as contained in para - 5 of this

Appellate Tribunal as contained in its earlier Order dated 16.4.2019 which reads

as under:-

"5. The Impugned Judgement and Order of NCLT when perused, shows summary recorded from the Company Petition. The NCLT noted the various contentions raised and prayers made by the original Petitioners. The Respondents filed written Reply in NCLT and the learned NCLT took note of the defence raised by the Respondents. The Respondents defended their actions, details of which can be seen in the Impugned Order. It appears that the original Petitioners filed Rejoinder and Respondents filed Sur- Rejoinder to support the respective cases as pleaded by the parties. All this is summarized in the Impugned Order which can be seen and we need not prolix this judgement reproducing those details, though we note the same. In para - 88 of the Impugned Judgement, the NCLT after referring to the various pleadings put up by the parties, recorded that the arguments before it were confined only with regard to transfer of 14,96,000 shares and issue of fresh equity shares.

In para - 94 of the Impugned Order, NCLT has recorded that during the pendency of the Petition, R3 and R6 filed CA 255/2015 claiming that the said Respondents being Directors of

Company Appeal (AT) No.102 of 2022 37

R1 - A.P. Refinery, entered into the Arbitration Agreement dated 12.07.2015 with P2 to P5, the Directors of Ricela Health Foods for referring the disputes to arbitration and appointing Arbitral Tribunal comprising of Ravi Kalra, Subhash Chand Singla, Meghraj Garg, Hemant Jindal, Satdev Jindal and Deepak Jindal to resolve the dispute between the parties. Copy of the agreement was attached as Annexure A-1. It was claimed that after due proceedings before the Arbitral Tribunal, a consent Order was passed on 12.07.2015 itself. The Impugned Judgement refers to details of what was recorded as consent award, which was tendered as Annexure A-2. The Respondents claimed that because of this, the Petitioners were bound to withdraw the Petition and could not challenge shareholding of R1 - AP Refinery.

5.1 The NCLT appears to have taken Reply of the Petitioners 2 to 5, who opposed the prayers of Respondents and who claimed that the said Annexures A1 and A2 had nothing to do with the present Petition. NCLT in para - 106 of the judgement took up CA 255/2015 which claimed that the Petition deserved to be dismissed on the ground of Arbitration Agreement and said Award and after discussing the matter and the provisions of Arbitration and Conciliation Act, 1996, found that the jurisdiction of the Tribunal was not barred and for reasons recorded, dismissed CA 255/2015 (para - 144 of the Judgement)."

69. The pleadings of the Appellant regarding alleged fresh transfers of shares

dated 28.11.2017 are not sustainable in view of very clear directive of this

Company Appeal (AT) No.102 of 2022 38

Appellate Tribunal contained in para - 40(A) especially in view of the last

sentence which is again reiterated:-

"(A) We do not disturb directions in para marked - 163 of the Impugned Order. We agree with the learned NCLT as regards operative direction - 'i' in para 161 of the Impugned Order that CA 255 of 2015 filed by the Respondents deserved to be dismissed. However, for reasons discussed above, we set aside rest of the operative Order as recorded in para - 161 of the Impugned Order and reasons recorded by NCLT in support of the same. Any steps taken by the parties pursuant to such directions recoded in para - ii to vi, pending Appeals shall stand set aside."

[emphasis supplied]

70. The intent of this Appellate Tribunal was very clear to restore the status

quo as was at the time of first transfer of shares on 19th May, 2010 and all

subsequent actions of the Appellants was set aside.

71. In this background and in view of the detailed discussion above, we do not

find any sound logic of the Appellants to issue alleged fresh transfer dated

28.11.2017 to justify the action of transferring back 14,96,000 shares in the

name of Appellant no.2.

72. We note that the concerned persons i.e. Appellant No.3 - Ravi Nandan

Goyal and Appellant No.4 - Shiv Kumar Goyal executed the documents for

transfer of the shares and board resolution, were the common directors of all

Company Appeal (AT) No.102 of 2022 39

three companies i.e. Appellant No.1, Appellant No.2 and Respondent No.1. If the

contention and the arguments of the Appellants about alleged fresh transfer

dated 28.11.2017 are accepted, it will tantamount of making the Order of the

Tribunal dated 15.11.2017 and Order of this Appellate Tribunal dated 16.4.2019

as nullity.

We therefore do not accept the pleadings of the Appellants regarding

validity of fresh transfer dated 28.11.2017. We also do not accept the contentions

that both the Tribunal in Order dated 15.11.2017 and this Appellant Tribunal

in its earlier Order dated 16.4.2019, did not intend to set aside fresh transfer

dated 28.11.2017 and rather allowed the same. We make it absolutely clear that

such contentions of the Appellants are wrong and illogical. The earlier Order of

this Appellate Tribunal was very clear and unambiguous in restoring

shareholding position as on 19.5.2010 and set aside all subsequent actions of

the Appellants which clearly included fresh transfer of the Appellants dated

28.11.2017.

73. We find the force in the logic of the respondents No.1 to 9 that despite 12

years legal battle and winning the legal battle before the Tribunal as well as this

Appellate Tribunal, the Respondents No.1 to 9 are still being treated as minority

shareholders.

74. Since the cost has already been imposed on the mentioned Appellants by

this Appellate Tribunal earlier in its Order dated 16.04.2019, which has

Company Appeal (AT) No.102 of 2022 40

apparently yet not been paid to the Respondents No.1 to 9. We are restraining

ourselves from further imposition of the cost keeping in view the pending Civil

Appeal before the Hon'ble Supreme Court of India but would like to take into

account the Appellants' disobedience which tantamount to contempt of Court,

since no stay has been obtained by the Appellants regarding cost to be paid by

the Appellants based on this Appellate Tribunal's earlier Order dated 16.4.2019.

The Appellants are directed once again to pay the cost as imposed by this

Appellate Tribunal in earlier Order dated 16.4.2019 now along with interest @

12% p.a. from 16.4.2019 till payment is made.

75. In fine, we do not find any error in the Execution Order of the Tribunal

dated 03.06.2022. The Appeal fails and stand dismissed.

76. Interlocutory Application, if any, are closed.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Mr. Naresh Salecha] Member (Technical) rs/ravi

Company Appeal (AT) No.102 of 2022