Mukesh Goel vs Goel Entrade Pvt. Ltd. & Ors

For Appellant : Ms. Shweta Bharti, Mr. J.K. Chaudhary, Mr. Avinash Singh and Ms. Katyani Mahendru, Advocates

ORDER

15.05.2019 The Appellant alleged violation of order of 'status quo' dated

29th November, 2017 in I.A. No. 46 /2017 and moved an application under

Section 425 of the Companies Act, 2013 for initiation of contempt proceedings

against the 'Contemnor - Respondents'. The National Company Law Tribunal,

Guwahati Bench (for short, the 'Tribunal') on hearing the parties dismissed the

application by impugned order dated 17th December, 2018 with the following

observations:

"12. However, such a mistake, although appears to be

quite clerical in nature, cannot be viewed liberally and

lightly in a contempt proceeding, more so, when the

petitioner/applicant in C.P. No. 25/2017 never made

any request to rectify such mistake -although--- such a 2

mistake in the order aforesaid, was quite apparent.

Rather, they chose not to rectify such a mistake having

enormous implications on the outcome of the petition

under consideration.

13. This is because of the fact that before being found

a person guilty of wilfully and intentionally violating the

direction of the court/tribunal, it must be proved beyond

any doubt that the contemnors were duly communicated

such an order requiring them to maintain status quo etc.

in respect of Goel Entrade Private Limited. The applicant

must also show that such direction was violated wilfully

and intentionally showing utter disdain to such direction

rendered by this Bench.

13. However, in the present case, there was no proof

whatsoever that contemnors had ever been

communicated with the aforesaid status quo order---

much lees--- their producing some evidence showing that

the condemners, having been posted with the status quo

order, requiring them to maintain status/quo in respect

of the assets, shareholdings and composition of the

Company Appeal (AT) No. 117 of 2019 3

Bard of Goel Entrade Private Limited, violated the same.

In the face of such revelations, there cannot be any

escape from the conclusion that allegation made against

the contemnors remains far from being established."

2. The present appeal has been preferred by the Appellant under Section 421

of the Companies Act, 2013 on the ground of being aggrieved by the order as

passed by the Tribunal is in violation.

3. Section 420 of the Companies Act, 2013 empowers the Tribunal to pass

order after giving the parties to any proceedings before it, a reasonable

opportunity of being heard. The order passed under Section 420 of the

Companies Act, 2013 is appealable under Section 421 of the Companies Act,

2013.

4. The power to punishment to the contemnor is vested with the Tribunal

under Section 425 of the Companies Act, which reads as follows:

"425. Power to punish for contempt

The Tribunal and the Appellate Tribunal shall

have the same jurisdiction, powers and authority in

respect of contempt of themselves as the High Court

has and may exercise, for this purpose, the powers

under the provisions of the Contempt of Courts Act,

Company Appeal (AT) No. 117 of 2019 4

1971, which shall have the effect subject to

modifications that--

(a) the reference therein to a High Court shall be

construed as including a reference to the Tribunal and

the Appellate Tribunal; and

(b) the reference to Advocate-General in section 15 of

the said Act shall be construed as a reference to such

Law Officers as the Central Government may, specify

in this behalf."

5. From the aforesaid provision, we find for the purpose of initiation of

contempt proceedings the Tribunal is empowered with the same power as that of

High Court and for the purpose power under the provisions of the Contempt of

Court Act, 1971 is applicable subject to modification as shown therein.

6. As per Contempt of Court Act, 1971, the appeal lies under Section 19.

7. In the circumstances, the question arises for consideration is whether the

appeal under section 421 is maintainable or not.

8. The other question is that if the Tribunal rejected the application for

initiation of contempt proceedings under section 425 of the Companies Act, 2013,

the person who alleged violation of the order if he is entitled to file the appeal

under Section 421 of the Companies Act, penal order of punishment having not

been passed.

Company Appeal (AT) No. 117 of 2019 5

9. In the present case, as we find that the Tribunal, after taking into

consideration the relevant facts, has come to a definite conclusion and refused to

initiate contempt proceedings, we are not deciding the issue aforesaid on merit

as we do not want to interfere. The appeal is dismissed. No costs.

[Justice S.J. Mukhopadhaya] Chairperson

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

[ Kanthi Narahari ] Member (Technical) /ns/gc

Company Appeal (AT) No. 117 of 2019