Surinder Mehta & Ors vs Prime Meiden Ltd. & Ors
- CitationCompany Appeal (AT) No. 220 of 2018
Ratio decidendi
The rule this decision rests on
The Tribunal may modify an interim order of the NCLT, in the interest of the Company and to ensure that the Company continues to function, by directing that an extraordinary general meeting be convened on three weeks' notice to all members, with any decisions taken on an earlier date operating only as interim arrangements that lapse unless re-approved at that meeting. Where an application under Section 45 of the Arbitration and Conciliation Act, 1996 has been heard and reserved for judgment, and the company petitions under Sections 241 and 242 of the Companies Act, 2013 have been pending for over a year, the Tribunal is expected to decide those petitions at an early date, and if the Section 45 application is disallowed the Tribunal may proceed with the company petitions uninfluenced by the observations in the impugned interim order or by the Appellate Tribunal's order.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Surinder Mehta & Ors. ...Appellants
Vs.
Prime Meiden Ltd. & Ors. ...Respondents
Present: For Appellants: -Mr. K. Dutta, Mr. J. Mehta, Mr.Robin Dubey, Mr. Nishant Bhardwaj and Mr. Ramanjit Singh, Advocates.
For Respondents: -Mr. Ramji Srinivasan, Senior Advocate with Mr. Lalit Bhasin, Mr. Inderaj Gill, Mr. RP Singh, Mr. Avichal Prasad and Mr. Lakshya Khanna, Advocates.
ORDER
23.07.2018─ 'M/s. Meidensha Corporation' filed an application under
Sections 241 and 242 of the Companies Act, 2013 against 'M/s. Prime
Meiden Ltd. & Ors.' in CP 369/ND/2017. In the said petition, an application
being CA 276/2018 was filed by the Petitioner invoking the provisions of
Sections 196 and 197 of the Companies Act, 2013 as the tenure of two of
their nominee Directors on the Board of the 1st Respondent Company had
expired and required renewal.
2. The National Company Law Tribunal (hereinafter referred to as
'Tribunal'), New Delhi, taking into consideration the fact that the serious
allegations of acts of oppression and mismanagement has been levelled
against 2nd Respondent to 10th Respondent and that the 1st Respondent
Company is engaged in the business of manufacture and sale of high
Contd/-............
-2-
technology equipment used in the power sector, including equipment for
generation, distribution, transmission precession engineering etc. directed
the parties to hold the EoGM on 11th July, 2018.
3. The Appellants- Surinder Mehta and Ors. who are the Respondents
in the said petition have also filed cross petition under Sections 241 and
242 of the Companies Act, 2013 which is also pending for hearing along
with the said petition. It is informed that Interlocutory Applications have
also been filed by the parties for passing appropriate orders under Section
45 of the Arbitration & Conciliation Act, 1996 which has already been heard
and order has been reserved.
4. Apart from other grievances, one of the grievance of the Appellants
are that the EoGM could not be held without giving three weeks' notice in
terms of the provisions of the Companies Act, 2013. However, taking into
consideration the fact that a petition under Section 45 of the Arbitration
and Conciliation Act, 1996 has been already heard by the Tribunal and the
matter is pending for judgment and in the interest of Company the interim
order dated 9th July, 2018 has been passed to ensure that one or other
Directors function, tenure of two of their nominee Directors having
completed, as agreed by the parties, we pass the following orders:
Company Appeal (AT) No. 220 of 2018 -3-
i. The Board of Directors is directed to call for a meeting of EoGM
giving three weeks' notice to the Members and fix the date of
meeting.
ii. The decisions, if any, has been taken on 11th July, 2018
nominating /electing one or other Director or Expert, they will
function by way of interim arrangement till final decision is
taken after three weeks in the meeting of EoGM.
iii. If the Directors and the technical expert nominated/ elected on
11th July, 2018 are re-elected or nominated in the next EoGM,
they will continue. Otherwise, they will cease to continue and
newly elected/nominated Directors and Technical Experts will
take over the position.
5. It is made clear that the notice should be served on all the Members
of the Company. However, if one other member fails to attend such meeting,
they can raise any grievances.
6. As we find that the Company Petition under Sections 241 and 242 of
the Companies Act, 2013 pending since more than one year and in the
meantime, the application under Section 45 of the Arbitration and
Conciliation Act, 1996 has already been heard, the Tribunal is expected to
pass appropriate order on such petition on an early date.
Company Appeal (AT) No. 220 of 2018 -4-
7. If the application under Section 45 is disallowed, the Tribunal may
proceed with the Company Petitions under Sections 241 and 242, and pass
order uninfluenced by the observations made in the impugned order dated
9th July, 2018 or by this Appellate Tribunal.
8. The impugned order dated 9th July, 2018 stands modified to the
extent above. The appeal stands disposed of with aforesaid observations
and directions. No cost.
(Justice S.J. Mukhopadhaya) Chairperson
(Justice Bansi Lal Bhat) Member(Judicial) Ar/uk
Company Appeal (AT) No. 220 of 2018
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