M. Sai Sudhakar vs Mantrawadi Nagachandrika

NATIONAL COMPANY LAW APPELLATE TRIBUNAL AT CHENNAI (APPELLATE JURISDICTION) Company Appeal (AT) (CH) No.10/2024 IA Nos. 162 & 163/2024 Contempt Case No. 4/2024 In the matter of: M. Sai Sudhakar & 2 Ors. ...Appellant V Mantrawadi Nagachandrika & 9 Ors. ...Respondents

Present : For Appellant : Mr. Anshuman Sharma, Advocate For Respondents : Mr. Asad Hussain, Advocate for R1-R5

ORDER

(Hybrid Mode) 16.10.2025:

Oral : Justice Sharad Kumar Sharma, Member (Judicial)

1. The Respondents herein had preferred a Company Petition, being

Company Petition No. 433/241/HDB/2020, Mantrawadi Nagachandrika &

4 Ors. v MPR Refractories Pvt. Ltd. & 7 Ors. In the company petition thus

preferred, the Respondent/Petitioner had sought for the following reliefs,

which are extracted hereunder: -

"a) To declare that Respondents 2, 5, 6, 7 and 8 are as oppressors and acting against the interest of Respondent No.1 Company.

b) Pass an order directing Respondent No.1 to cancel the allotment of shares to Respondent No.2 to 5 vide board meeting dated 17.10.2020 as illegal, null and void ab initio.

c) Declare the transfer of 5,15,000 shares from Petitioner No.1's late Husband to Respondent No.2 vide entries dated

17.09.2010 in "Register of Directors Share and Debenture Holdings" - members list as illegal, null and void ab initio.

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d) Declare the Petitioner No.1 as the holder and owner of 1,39,700 + 5,15,000 shares of Respondent No.1 Company, and direct the Respondent No.1 Company to rectify the members register with respect to the said shares.

e) Remove Respondent No.5 as a director of Respondent No. 1 Company and declare his non directorship effective 21.11.2019.

f) Direct Respondent No.5 to return the Respondent No.1 Company documents handed over to him vide board meeting dated 21.11.2019.

g) Remove Respondent No.6 as nominee director of Respondent No.1 Company and declare Respondent No.6's non directorship from 23.07.2020.

h) Declare the resolutions passed by the board of Respondent No.1 Company from 23.07.2020 till date as illegal, null and void ab initio."

2. During the course of the proceedings, the Ld. Tribunal has passed

various interlocutory orders, qua the aspect of determination of the right

issues, which was formulated, during the course of the proceedings of the

company petition itself and particularly the references which has been made

by the Ld. counsel for the Respondent in relation to the docket order that

were passed by the Ld. NCLT during the course of the proceedings of

Company Petition, on 01.08.2023 and also the docket order dated

16.08.2023, which has been attempted to be read by the Ld. counsel for the

Respondents, as if, it would amount to be an independent still an existing

order granting of the partial relief, which was principally prayed for in the

Company Petition particularly in the context of the main relief no. 2, that

was sought therein and that inferences been derived by the

Respondent/Petitioner, in the light of the observations which has been made

by the Ld. Tribunal in para 24 of the impugned order.

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3. The Appellant herein, had preferred the instant Company Appeal

challenging the part of the impugned order and the findings thus recorded

therein the impugned order, Appeal by questioning the observation, which

has been made in para 11, 17, 18, 19, 21, 22, 23 and 24. The Appellant

submits that, the observations, which has been made in the aforesaid

paragraphs are based upon the misreading of the evidence and the findings

which had been recorded therein are perverse. As far as the aforesaid

argument is concerned, the ultimate conclusion could be that, since the

Company Petition, which has been preferred by the Respondent/Petitioner in

the context of the relief that was sought for in the Company Petition that, has

been ultimately dismissed, and the dismissal of the Company Petition will

amount to be a dismissal of the relief that was sought for in totality. The

findings that had been recorded in the body of the judgment dated

28.11.2023, cannot be extracted to be independently read in context of the

docket orders, which were passed during the pendency of the Company

Petition, which otherwise under the principle of merger would stand merged

with the final order resulting the dismissal of the Company Petition, those

excerpts of docket orders now cannot be extracted to be placed in correlation

to the stray observation that has been made in para 24 of the impugned order

for reading it independently in the context as if the relief no.2 particularly

when Company Petition as whole has been dismissed, it cannot be said that

any relief thereto has been granted to the Respondent/Petitioner. Even

Company Appeal (AT) (CH) No.10/2024 Page 3 of 7 otherwise also it is a settled principle of law that, once the main proceedings

has been laid to rest by the Tribunal or any Court on merits it will attach

finality to all interlocutory orders which would automatically stand merged

with the final unchallenged order, and that cannot be retrieved to be attracted

by a party to the proceedings of the Company Petition, later to be utilised for

the purposes in any subsequent proceedings, and particularly by the

Respondent/Petitioner whose Company Petition has already been dismissed

on merits by the order dated 28.11.2023, which till date remains

unchallenged. Thus, the argument extended by the Ld. counsel for the

Respondent/Petitioner, treating as if the docket orders would still be

surviving even after dismissal of his Company Petition and the orders passed

during the proceedings of the Company Petition could be read in the context

of relief no.2, is not acceptable by this Appellate Tribunal and the said

arguments as raised by Respondent/Petitioner would stand turned down, as

all interlocutory orders upon dismissal of the Company Petition, would meet

its legal death.

4. As far as the Appellant's contentions qua the challenge given to the

particular findings that has been recorded in para 11, 17, 18, 19, 21, 22, 23

and 24 of the impugned order dated 28.11.2023, we are of the view that,

admittedly, the order passed by the Ld. Tribunal of dismissing the Company

Petition, preferred by Respondent/Petitioner, has not been subjected to

challenge by the Respondent/Petitioner, by preferring any independent

Company Appeal (AT) (CH) No.10/2024 Page 4 of 7 appeal, nor there is any cross appeal as principally contemplated under Order

41, Rule 22 of the Code of Civil Procedure (CPC). In that eventuality, when

the consequential effect of the impugned order dated 28.11.2023, is that, the

relief that was sought for by the Respondent/Petitioner would be treated to

have been denied in totality, any stray finding, which has been recorded

partially in the paragraphs as referred to herein above, which has been sought

to be questioned by the Appellant while preferring the Appeal, will be only

confined to be read in the context of the order dated 28.11.2023 and those

findings cannot be derived and extracted to be utilised as against the

Appellant in any other collateral proceedings including the Contempt

Petitions, which has been drawn against him. In that eventuality, where the

Company Petition has been dismissed, as it was preferred by the

Respondent/Petitioner, the findings as recorded therein, which was later

made a subject matter of scrutiny in this instant Company Appeal at the

behest of the Appellant/Respondent herein cannot be sustained and they

would too be treated to have met its judicial death with the adjudication of

the Company Petition made by the judgment of 28.11.2023 and would be

treated to merged with resultant dismissal of the Company Petition. In that

eventuality, we are unable to appreciate the argument extended by the Ld.

counsel for the Respondents/Petitioner that the dismissal of the Company

Petition, could not be taken, as if it would amount to a partial grant of the

relief, particularly if we see the manner in which the adjudication has been

Company Appeal (AT) (CH) No.10/2024 Page 5 of 7 made by the Ld. Tribunal, particularly in the context of the observations that

has been made by the Ld. Tribunal in para 22, 23 and 24 of the impugned

judgment, which are only incidental in nature, for the purposes to enable the

Tribunal to arrive at a conclusion, as to whether at all the controversy falls

to be within the ambit of Section 241, 242, 57, 58, 59 and 62 of the

Companies Act, 2013, or not. Those paragraphs cannot be independently

extracted to be treated to be a conclusion in itself for the purposes of grant

of the relief to the Respondent/Petitioner, particularly when the Company

Petition itself has been dismissed.

5. Respondent/Petitioner cannot be permitted to take a stand that though

his Company Petition has been dismissed in totality, and the said judgment

remains unchallenged at his behest, it could read as if by virtue of the

findings, the relief no.2 would be treated to be granted by an interpretation

of the findings in the body of the judgment particularly when the relief no.2

has not been saved to be granted by the final judgment.

6. In these eventualities, this Company Appeal would stand closed with

an observation thereof that, all those findings, which have been made subject

matter of challenge by the Appellant in the instant Company Appeal would

be limited to be the finding restricted qua the relief, which has been sought

in the Company Petition by the Respondent/Petitioner itself and it would be

confined to be read only for the purposes of an adjudication made by the Ld.

Tribunal in relation to the impugned judgment under challenge, i.e.,

Company Appeal (AT) (CH) No.10/2024 Page 6 of 7 28.11.2023, and it will not be extended to be read for any collateral purposes

as against the Appellant particularly when the Company Petition has been

dismissed and the dismissal has not be challenged. The Company Appeal

accordingly stands closed.

[Justice Sharad Kumar Sharma] Member (Judicial)

[Jatindranath Swain] Member (Technical)

AR/MS/AK

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