Rescon Manufacturin Co. Pvt. Ltd. And ... vs Sanjeev Ramesh Doshi And Ors

1

NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI

Company Appeal (AT) No. 212-213 of 2022 & I.A No. 4429 of 2022

IN THE MATTER OF: Rescon Manufacturing Co. Pvt. Ltd. & Ors. ...Appellants Versus

Sanjeev Ramesh Doshi & ors. ...Respondents Present:

For Appellant : Mr. Vinamra Kopariha, Mr. Daniyal Khan, Advocates For Respondents : Mr. Aman Singhania, Mr. Rajat Kashyap, Mr. Ashutosh Mishra, Advocates

ORDER

01.12.2022: Heard Mr. Vinamra Kopariha, Ld. Counsel for the Appellant

and Mr. Aman Singhania, who is voluntarily appearing on behalf of the

Respondent.

2. On Interlocutory Application No 4429 of 2022, which has been filed in CA

(AT) No. 212-213 of 2022 for condonation of delay, Ld. Counsel for the Appellant

submits that due to the reason that the Appellant was intending to change the

counsel, some time was consumed in filing the appeal. Accordingly, within 45

days of the time as prescribed under Section 421(3) of the Companies Act, 2013

(hereinafter referred as to 'Act'), the appeal could not be filed. However, it has

been argued that the Appeal has been filed within further period of 45 days.

Some other reasons have also been assigned for belated filing of the appeal. Ld.

Counsel for the Respondent opposed the prayer for condonation of delay.

However, considering the fact that both impugned orders i.e order dated Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 2

11.08.2022 and 15.09.2022 were assailed within extended period of 45 days,

this Tribunal is having jurisdiction to condone, if satisfied with the reason. We

are of the opinion that in view of reason assigned in the application, limitation is

required to be condoned. Accordingly, the Application for condition of delay is

allowed and in filing appeal, delay is condoned.

3. The present appeals i.e. CA(AT) No. 212-213 of 2022 have been preferred

against two orders passed by 'National Company Law Tribunal, Mumbai Bench,

Court -IV' (hereinafter referred as to 'NCLT') in CA-411/2022 in

CP/99(MB)/2020. By first order i.e. order dated 11.08.2022, an application filed

by the Respondents, who were Petitioners before the NCLT, for rectification in

the order dated 12.07.2022, has rectified the same and it has been indicated

that on 12.07.2022 while dictating order in CA 338 of 2022 in CP/99(MB)2020,

it was ordered to maintain status quo. It was also ordered that status quo order

would be effective from 12.07.2022 till date of hearing i.e. 15.09.2022. The

second order i.e. 15.09.2022 only indicates that due to paucity of time, the

matter was adjourned to 01.12.2022 and status quo dated 12.07.2022 and

11.08.2022 were directed to remain effective till the next date of hearing and next

date of hearing was fixed to 01.12.2022.

4. Before proceedings to examine correctness of the order, it is necessary to

reiterates certain facts. It is not in dispute that in the month of January, 2020,

the Respondent had filed CP/99(MB)2020 under Section 241 -242 of the Act

making allegation of 'Oppression' and 'Mismanagement'. In the said petition, the

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 3

reply was filed by the Appellants herein on 30.03.2022. Subsequently, in the

month of June, 2022, the Respondent herein (Petitioner before the NCLT) filed

another application i.e. CA 338 of 2022 for passing some interim order, in view

of the fact that the Respondents were of the opinion that in the meanwhile the

Appellants herein were trying to create 'third-party rights in respect of the

property of the company'. The said petition was in virtually mode heard on

12.07.2022. Order dated 12.07.2022 is reproduced herein below:

"1.Ms. Sonal, Ld. Counsel for the Petitioner present. Ms.

Aakanksha Luhach i/b MZM Legal LLP, Ld. Counsel for

the Respondent present.

2. List this matter for hearing on 15.09.2022."

5. On perusal of the aforesaid order, it is evident that while directing for listing the

case on 15.09.2022, no interim order was passed by the Ld. NCLT. However,

subsequently, on 01.08.2022 after the order was passed on 12.07.2022, the

Respondents herein filed an application which was numbered as CA 411/2022 seeking

rectification in the order dated 12.07.2022. On filing of the said application, the first

impugned order was passed on 11.08.2022 which is quoted herein below:

"1.Adv. Sonal a/w Adv. Milan Hebballi, Ld. Counsel

for the Applicants in CA411/2022 present. Adv.

Aakanksha Luhach i/b MZM Legal LLP, Ld. Counsel

for the Respondents present.

2. CA-411/2022 is filed by the main Petitioners in the

matter for seeking rectification in the order dated

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 4

12.07.2022 of this Bench. On 12.07.2022, this Bench

heard CA-338/2022 in CP/99/2020 and it was

ordered in the open court that 'status quo' to be

maintained by the Respondents in the affairs of the

company i.e. Respondent-1 and to file reply in the CA

within 15 days. However, erroneously the same was

not appeared in the order uploaded. Hence, the

Petitioners/aggrieved party filed this Application.

3. Since this Bench was convinced upon hearing the

argument of the Counsel for the Applicant in CA-

338/2022 and ordered 'status quo' on 12.07.2022,

the same stands alive. It is hereby ordered that the

'status quo' order is effective from 12.07.2022 till next

the date of hearing i.e. 15.09.2022.

4. With the above directions, CA-411/2022 is allowed

and disposed of."

6. Ld. Counsel for the Appellant submits that after the said order, the Appellant

filed reply before the ld. NCLT which is at page 147 of the Appeal Paper Book. In the

said reply, the stand was taken that on 12.07.2022 the order was uploaded on the NCLT

website portal, in which there was no any interim order. Ld. Counsel for the Appellant

has drawn our attention to statement made in Para 15 of the reply which was filed on

14.09.2022. It is apt to reproduced para 15 herein below:

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 5

"15.It is worth noting that on 30.06.2022, the Applicants

had preferred the present Company Application seeking

certain interim reliefs against the Respondents. The

Company Application was then listed for the first time

on 12.07.2022. On the date of hearing, the Applicants

sought a status quo injunction against the Respondent

vis-à-vis the affairs of the Respondent No.1 Company till

the next date of hearing. This prayer of extreme urgency

was made after 2 years of filing the Company Petition.

The Respondents immediately sought time to file a reply

to the Company Application and at the same time

strongly opposed the grant of any interim reliefs in the

absence of its detailed reply. The said hearing on

12.07.2022 had taken place virtually. Thereafter, the

Respondents awaited the order of the NCLT and when

the order for 12.07.2022 was uploaded on the online

NCLT website portal, the Respondents were made

aware that no interim relief has been granted by the

Adjudicating Authority. However, much to the

Respondents' shock, the Applicants, with mala fide

intentions, preferred another Company Application

under Rule 11 of the NCLT Rules, 2016 bearing number

411/MB/2022 for rectification of the order dated

12.07.2022. However, in utter disregard to the

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 6

principles of natural justice and limitations provided

under the NCLT Rules, 2016 and without affording the

Respondents an opportunity to present their objections

and Reply, an order was passed on 11.08.2022 and the

objections raised by the Respondents were not

considered and arbitrarily, the order dated 11.08.2022

was passed for including the interim relief for injunction

as prayed for by the Applicants."

7. Thereafter, on 15.09.2022, the matter was again taken up, however, due

to paucity of time, no order was passed on reply and status quo order was

directed to be extended till the next of hearing and the date was fixed to

01.12.2022. During the course of hearing, it was reiterated by the Ld. Counsel

for the Appellants that on first date i.e. on 12.07.2022 though it was virtual

proceedings, no status quo order was passed and even, thereafter, on an

application filed by the Respondents, the Ld. NCLT on assumption that earlier

there was status quo order and due to oversight it was not recorded, directed to

presume, as if, on 12.07.2022 there was order of status quo and same order was

directed to continue and it is continuing till date. According to Ld. Counsel for

the Appellant if the order which was already uploaded, was not indicating any

status quo order or interim order, there was no reason for rectifying the same on

the prayer made by the Respondents herein. He further submits that since in

the main 'Company Application', reply has already been filed, it would be

appropriate to direct the NCLT to finally decide the issue instead of lingering the

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 7

appeal and continuing the status quo order, which is not sustainable in the eye

of law.

8. Ld. Counsel for the Respondents opposing the prayer in the appeal, has

argued that the proceedings on 12.07.2022 was virtual proceedings and it

appears that due to oversight in the said order, the 'status quo' word was missed

and subsequently when the application was filed by the Respondents to rectify

the order, the Ld. NCLT on verification of records, had passed order and felt that

in open court, interim order was passed which was missed to be recorded in the

same. Accordingly, the Ld. NCLT has not committed any error in correcting the

mistake which occurred earlier. According to him, there is no reason for

interference with either of the order dated 11.08.2022 as well as 15.09.2022. He

further submits that matter is already pending before the NCLT and as such only

direction can be issued to finally decide the main petition. He further submits

that of course the Respondents had filed main petition in the year 2020 but since

in the year 2022, it was noticed that the Appellants herein were trying to create

third-party rights, the Respondent filed application for passing of the interim

order which has been allowed.

9. Besides hearing ld. Counsel for the parties, we have carefully perused the

materials available on record and after going through the same, we are prima

facie of the view that order dated 11.08.2022 is not sustainable in the eye of law.

Once an order was uploaded and in uploaded order, there was no word indicating

as to whether there was 'status quo' order or not, subsequently, on application

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 8

filed by the Respondents, the NCLT was not having any authority to pass such

order. Moreover, it is true that the 'Court' or the 'Tribunal' is having ample

jurisdiction to pass interim order in the proceedings in view of the facts and

circumstances, but if such order is to be passed, there must be some reason for

passing the same.

10. On perusal of amended order dated 11.08.2022, we find that no reason

has been indicated for passing status quo order or interim order. In a

proceedings while passing an order of injunction, there are requirement to

examine at least three main ingredients (i) 'Prima facie case', (ii) 'Balance of

convenience' & (iii) 'Irreparable loss'. However, in the amended order, all those

ingredients are missing.

11. The order dated 11.08.2022 further appears to be erroneous due to the

reason that once after first order i.e order dated 12.07.2022, an application was

filed by the Respondents requesting for rectifying the order, the respondents in

their petition which was filed on 01.08.2022 and has also been brought on record

at running page No. 141-145, in para 3 and 4, the Respondents mentioned that

in order dated 12.07.2022, the word "No Third-Party rights shall be created in

the properties of Respondent No.1 and that reply to be filed by Respondents

within 15 days from the date of the order" was missing. However, even on such

application wherein there was no indication that in the earlier order dated

12.07.2022, the 'status quo' word was missing, the Ld. NCLT has committed

error in introducing the said word by its order dated 11.08.2022 whereby the

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 9

word "status quo" was inserted with retrospective effect i.e. order dated

12.07.2022. At this juncture, it would be appropriate to reproduce para 3 &4 of

the application filed by the Respondent (Applicants before NCLT) before the

NCLT.

"3.The Application was listed on 12.07.2022 at

Serial No. 08. After perusing the application and

briefly hearing the parties, This Tribunal passed

an order restraining the Respondents from

creating any third party rights in the properties

of Respondent no.1 till the next date. The said

order was dictated in open court. That the

Applicant states that to their surprise when the

order was up-loaded, they were shocked to find

that important reliefs sought by the Applicants

which this Tribunal had considered and allowed

were missing from order dated 12.07.2022,

that "No Third-Party rights shall be created

in the properties of Respondent No.1 and

that reply to be filed by Respondents within

15 days from the date of the order.".

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 10

4. It appears that by the stenographer's mistake

or inadvertence the aforesaid important part of

the order is missed out and is not reflecting in

the order dated 12.07.2022. Therefore, current

Company Application is filed by the Applicants

seeking corrections/rectification and re-

incorporation of important part of order that is

"No Third-Party rights shall be created in

the properties of Respondent No.1 and that

reply to be filed by Respondents within 15

days from the date of the order.". It is humble

request by way of the current company

application to this Tribunal to correct the order

passed by this Tribunal in the interest of

justice."

12. Of course, a plea was taken by Ld. Counsel for the Respondents that before

passing rectification order, the Ld. NCLT had examined the record but nothing

is reflected in the impugned order and as such, submission of Ld. Counsel for

the Respondent may not be acceptable.

13. In any event, we are of the opinion that Ld. NCLT has committed error in

passing the order dated 11.08.2022 and again reiterated the same by its order

dated 15.09.2022. Accordingly, both the orders may not be allowed to continue

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022 11

and both orders are hereby set aside. However, it is made clear that if any fresh

application is filed by the Respondents for any interim relief, the Ld. NCLT would

be at liberty to decide the same in accordance with the law after hearing both

the parties.

14. Before parting with this order, it is also required to request the Ld. NCLT

that, if pleadings, in main petition is complete then he may take appropriate

steps for final disposing of the same and both the parties are directed to render

full assistance to the Ld. NCLT for expeditious disposal of the main petition.

With above observations and directions, the appeal is allowed.

Pending application, if any, stands disposed of. No order as to costs.

[Justice Rakesh Kumar] Member (Judicial)

[Dr. Ashok Kumar Mishra] Member (Technical) Raushan/gc

Company Appeal (AT) No. 212-213 of 2022

& I.A No. 4429 of 2022