Mcdonald’S India Pvt. Ltd. & Ors vs Vikram Bakshi & Ors

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI I.A. No. 1024 of 2017 in Company Appeal (AT) No. 275 of 2017 IN THE MATTER OF:

Mcdonald's India Pvt. Ltd. & Ors. ...Appellants Vs Vikram Bakshi & Ors. ....Respondents

Present: For Appellants: Mr. Rahul Dave and Mr. Niti Dixit, Advocates for Appallent No. 1. Mr. Amit Dhingra, Mr. Abhishek Tiwari, Ms. Raunaq Mathur, Ms. Zahra Aziz, Mr. Mohit Negi and Mr. Suryaveer Berry, Advocates for Appallent No. 2 and 3.

For Respondents: Mr. Jayant Mehta, Mr. Rahul Kukreja and Mr. Gauhar Mirza, Advocate for Respondent no. 1, 2& 9. Mr. P. Nagesh, Advocate for Respondent No. 3. Mr. Arun Kathpalia, Sr. Advocate with Mr. Satyajit Sarna, Ms. Pallavi Srivastava, for Respondent No. 7.

ORDER

(03.01.2018)

Heard learned counsel for the Applicant Mr. Devinder Jain who is

respondent no. 7 in the appeal. The learned counsel for this applicant submits

that the impugned judgment and order passed in the main matter of the

appeal is under challenge and is still pending. He submits that the applicant

was appointed as Company Secretary which appointment was confirmed by

resolution passed by the Board of Directors on 29.09.2008 which is at

Annexure P1. He submits that in 2009 the Board of Directors gave additional

charge to the applicant of General Manger Legal. It is stated that when the

matter was pending before the NCLT the respondent no. 1, 2 and 9 raised

various disputes against the applicant and he was harassed and attempts

Company Appeal (AT) No. 275 of 2017 2

were made to dislodged him but the NCLT protected the applicant. The

counsel referred to order dated 05.12.2013 copy of which has been filed at

page 24 and another order dated 09.09.2015 copy of which has been filed at

page 37 and a reference has also been made to another order dated 02.07.15

passed by the High Court of Delhi in a Contempt Application. The counsel

further referred to the final order passed by The Institute of Company

Secretaries of India copy of which is filed as Annexure P2 exonerating the

applicant for the acts alleged against him by the respondent no.1 making

grievance of filing of Form 32. The learned counsel further referred to the order

dated 23.07.2015 passed by Company Law Board copy of which is at

Annexure P4 to submit that the present Appellant moved the NCLT for

protecting the employees from the acts of the present respondents and the

Company Law Board had protected them.

2. The learned counsel has then referred to Annexure P7, document

signed by respondents 9 (of the appeal) which is a letter issued on 21.12.2017

to the applicant (respondent no. 7). The main contents read as under:

"Sub: Termination of Services

Dear Mr. Jain,

This is to inform you that your services as General Manger- Legal &

Secretarial, stand terminated w.e.f. December 21, 2017.

As per clause No. 10 of the Letter of Appointment issued to you on

dated 03.09.2008, you are being given one month's gross salary in

Company Appeal (AT) No. 275 of 2017 3

lieu of the notice period. This is in accordance with the said

appointment letter.

As you have been terminated as General Manager- Legal &

Secretarial with effect from 21.12.2017, the additional

responsibility assigned to you as the Company Secretary and

Compliance Officer of the Company, also stands withdrawn with

effect from 21.12.2017.

Accordingly, you are advised to contact the HR Department today to

complete the separation formalities to process your full and final

settlement."

3. The learned counsel for the applicant states that when the earlier record

shows that the applicant was appointed by the Company and the Board

resolutions had conferred certain duties on him, the present letter dated

December 21, 2017 by respondent no. 9 as "Sr. Director- Human Resources &

Corp. Community" could not have been issued in the manner in which it has

been done and the present action of the respondent no. 9 cannot be protected

and the said letter deserves to be stayed.

4. Advocate Shri Amit Dingra for appellants 2 and 3 submits that there

was a board meeting held on October 25, 2017 in which one of the subject was

whether the applicant should continue as Company Secretary and General

Manager- Legal of the company but the item was not discussed and the same

was deferred and thus he submits that there is no board resolution.

Company Appeal (AT) No. 275 of 2017 4

5. Against this the learned counsel appearing for respondent no. 1, 2 and 9

in the appeal, tenders across the Bar a document dated 3rd September, 2008.

It is taken on record and marked 'X' for identification. The learned counsel

submits that by this letter the applicant was appointed as General Manager-

Legal & Secretarial and condition 10 of the appointment reads as under:-

"10. Resignation/ Termination of Services

Your employment will be subject to termination by either party by

giving to the other party 30(thirty) days notice in writing. In the event

of your leaving employment without notice, you shall pay to the

Company a sum equivalent to one month gross salary and similarly

the company shall be liable to pay an amount equal to one month

gross salary. In event of your leaving employment without notice,

your Privilege Leaves available at the time of resignation will be

adjusted against the notice period."

6. Referring to the above condition the submission is that the company can

terminate the service of applicant by giving one months notice or salary in lieu

of the notice period. According to the counsel in line with this condition the

present letter in Annexure P7 has been issued which is perfectly legal and

thus according to him no orders need be passed which would be in the nature

of mandatory directions. It has been further submitted that the interim orders

which were passed during the pendency of the matter before NCLT got merged

in the final orders disposing the Company Petition and whatever is not saved

Company Appeal (AT) No. 275 of 2017 5

in the final order cannot be banked upon. The counsel referred to the

impugned final order which is subject matter of the appeal and reference was

made with regard to applicant in Para 36 where the NCLT had observed that it

was taking the order dated 08.04.2017 on record as passed by the Institute of

Company Secretaries of India without making any further observation and had

added that it shall not however act to the prejudice of any of Mr. Vikram

Bakshi. The learned counsel then referred to the part of impugned order which

states that all the applications stood disposed off. The counsel submitted that

the final order in Para 41(i) recorded that the filing of the form 32 was illegal.

Thus he justifies the impugned letter and according to him the present

application cannot be maintained by the applicant and no relief can be given.

7. It has been further stated for Respondent no. 1, 2 and 9 that there is no

provision that for removing the Company Secretary Board Resolution would be

necessary.

8. We have heard counsel for both sides. Going through the material

available and which has been pointed out to us and to which we have referred

above, as well as the fact that the present appeal is fixed for hearing finally on

12th January, 2018 along with the Company Appeal 280/17 which has been

filed by respondent no. 1, we find that it would be appropriate that the parties

do not indulge in any such acts which would create hindrances in the decision

of the appeals. It is not appropriate that the main issues get brushed aside

and other disputes are created, taken up and agitated. It is in the interest of

both the sides that both the appeals are taken up for hearing finally and

Company Appeal (AT) No. 275 of 2017 6

whatever decision is taken gets taken in the main matters. At the same time,

looking to the various orders and directions which were passed when the

matter was in the NCLT where also it appears respondent no. 1 and 9 had

grievances against the applicant and still the NCLT had protected

applicant/respondent no. 7 till the final decision was taken, it would be

appropriate that the position is maintained. The submission of the learned

counsel for the respondent no. 1, 2 and 9 that in the final order submission of

Form 32 by Applicant has been held illegal is subject matter of the appeal. The

main matter is yet to be finally decided in this Tribunal and thus at the

moment it would not be appropriate to put a finger there and maintain action

of respondent no. 9 pending the appeal. It is rightly submitted by the counsel

for the applicant that there is no board resolution for removing a person of the

status of the applicant from the company. When the appointment was made

by the company, a person in the status of General Manager- Legal & Company

Secretary who has been protected when the matter was in the NCLT could not

be dealt with in the manner in which respondent no. 9 has issued Annexure

P7.

9. For the above reasons, we stay the letter dated December 21, 2017

(Annexure P7) and its effects till decision of the appeal. Till the decision of the

appeal, status quo anterior to the issue of this letter Annexure P7 shall be

maintained with regard to the services of applicant. In the meanwhile, if Board

of Directors duly take any unanimous decision with regard to services of

Company Appeal (AT) No. 275 of 2017 7

Applicant/ Respondent no. 7 the same may not be acted upon without

reference to this Tribunal.

10. The application is accordingly disposed.

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

(Justice Bansi Lal Bhatt) Member (Judicial)

Sh/nn

Company Appeal (AT) No. 275 of 2017