Refpay Media Private Limited & Ors vs Mukesh Kumar

09.08.2023: Heard Mr. Gaurav Mitra, learned counsel assisted by

Mr. Anshul Gupta, learned counsel for the appellant and Mr.

Mayank Wadhwa, learned counsel who has appeared on advance

notice on behalf of Respondent.

2. The present appeal has been preferred under Section 421 of

the Companies Act, 2013 against an innocuous order dated

25.07.2023 passed by National Company Law Tribunal, New Delhi.

For better appreciation it is apt to reproduce the same as under:

"Heard the submissions made by Learned counsels for both

the parties. The respondents are permitted to conduct EOGM.

However, the decision on agenda item regarding the removal

Company Appeal (AT) No.141/2023 2

of petitioner from the directorship, if any, shall not be given

effect till the outcome of the Company Petition. It is made clear

that not only removal but also filing of DIR-12 are prohibited

until the matter is disposed of. It is made clear that if the

petitioner submits any response with regard to notice in the

agenda item within 24 hours from now, respondent may

consider the same in EOGM.

Let the matter be posted to 01.08.2023."

3. Learned counsel for the appellant assailing the impugned

order has argued that law is settled to the point that the decision

of the Board of Directors of a company may not be looked into by

the NCLT. In support of his submission he has drawn our

attention to notice dated 03.07.2023 which is at running page 97

to 104. Learned counsel for the appellant has also drawn our

attention of 3rd para at page 98 which is reproduced hereinbelow:-

"Further it is stated in the requisition letter and special notice

that Refpay Media Pvt Ltd is incorporated on October 10, 2018

having registered office at Delhi, Mr. Mukesh Kumar is a one

of the Director on the board of Refpay Media Pvt Ltd. However,

Mr. Mukesh Kumar has not been taking active participation in

the functioning of Refpay Media Pvt Ltd hindering the growth Company Appeal (AT) No.141/2023 3

of the company due to which many employees have raised

objections against him. Mr. Mukesh Kumar being on board of

Refpay Media Pvt Ltd has created the conflict of interest as he

is already director in other companies due to which vendors

are not willing to engage in work with Refpay Media Pvt Ltd,

thus causing financial loss and hindering the growth of the

company. Mr. Mukesh Kumar is working against the interest

of the company and has been doing frivolous litigation against

Refpay Media Pvt Ltd. Mr. Mukesh Kumar as director of

Refpay Media Pvt Ltd is neither tenable not suitable and hence,

the holding company having lost its confidence in Mr. Mukesh

Kumar seeks his removal from the directorship of Refpay

Media Pvt Ltd. Further his removal is necessary for future

growth of the company. Consequently, the Board of Directors

of Refpay Media Pvt Ltd by its resolution dated 3rd July, 2023

has resolved to propose the removal Mr. Mukesh Kumar as

Director of Refpay Media Pvt Ltd."

4. He submits that the order impugned is contrary to the law

settled by Hon'ble Supreme Court in Life Insurance Corporation

Vs Escorts Ltd (1986) 1 SCC 264 and Ravinder Sabharwal & Anr

Vs XAD Inc. & Ors; CS(Comm):1057/2018 as well as without any

Company Appeal (AT) No.141/2023 4

reason such impugned order has been passed. Accordingly the

order impugned is liable to be set aside.

5. Learned counsel for the Respondent orally submitted that the

appeal is required to be reject primarily on the ground that the

appellant had not brought on record the order dated 03.07.2023

whereby the appellant was restrained from implementing the

decision taken in the Board Meeting. He submits that such order

was passed on 03.07.2023 and in continuation of the earlier order

the present impugned order has been passed. As per order

impugned the matter was posted to 1.8.2023. However, on

instructions he submits that on 1.8.2023 the matter was simply

adjourned and next date is 29.08.2023.

6. Besides hearing learned counsel for the parties we have

cursorily perused the material available on record. On perusal of

the Memo of Appeal it is evident that on 10.04.2023 the

Respondent had filed an application under Section 241-242 of the

Companies Act, 2013 alleging oppression and mismanagement

bearing CP No.83/2023. After the said petition was filed it appears

that the appellant sent requisition letter for conveying EOGM

which was to be conducted on 26.06.20123. It appears that after

the issuance of requisition for EOGM for Board Meeting to be held

Company Appeal (AT) No.141/2023 5

on 26.06.2023 the Respondent on 23.06.2023 filed an IA vide CA

No.215/2023 with a prayer to stay the Board Meeting which was

scheduled to be held on 26.06.2023. However, subsequently the

date of the Board Meeting which was scheduled to held on

26.06.2023 was postponed and deferred to 03.07.2023. The stay

petition CA No.215/2023 was got listed on 03.07.2023 for urgent

hearing. On 03.07.2023 learned NCLT was informed as if Board

Meeting dated 03.07.2023 was already held. Thereafter as per

pleading in the present appeal on the same date i.e. 03.07.2023

learned NCLT passed a restraint order restraining the appellant

from implementing the decisions taken in the Board Meeting.

However, in the present appeal to the reasons best known to the

appellant neither the order dated 03.07.2023 has been assailed

nor same has been brought on record and the appeal has been

preferred against order dated 25.07.2023 which appears to be an

order in continuation of earlier order with certain modifications.

Moreover it appears that CA No.215/2023 is still pending before

the NCLT. Since he has not assailed the earlier order dated

03.07.2023 without assailing earlier order we are of the opinion

that there is no reason to interfere with the impugned order

particularly in view of the fact the order impugned prima facie

Company Appeal (AT) No.141/2023 6

appears to be innocuous order and in continuation of the earlier

which has not been assailed. Accordingly there is no reason to

interfere with the impugned order. The appellant if so advised may

raise the issue before NCLT itself.

7. The appeal stands dismissed.

(Justice Rakesh Kumar) Member (Judicial)

(Dr. Alok Srivastava) Member (Technical) Bm/manu

Company Appeal (AT) No.141/2023