SMT. AMARJEET KAUR V. M/S DEE TEE ELECTRONICS INDIA PVT. LTD.

Full Text of Judgment:

Respondent No. 3.
2. The present Appeal has been filed challenging the Impugned Order dated 19.01.2022 passed by the NCLT (National Company Law Tribunal, Bench – IV, New Delhi) in CA 04/ND/2021 in CP 129/ND/2019. In the said CA 04/ND/2021, the five Applicants therein namely Smt. Anju Dheeman wife of late Sh. Preet Pal Singh, Sh. Japneet Singh (Minor) son of late Sh. Preet Pal Singh, Ms. Bhavneet Deeman (Minor) daughter of late Sh. Preet Pal Singh, Smt. Amarjeet Kaur (Appellant No. 1 herein) and Sh. Amrit Pal Kaur (Appellant No. 2 herein) had prayed for impleadment and addition as Petitioner in the main Company Petition No. 129/ND/2019.
4. As noted in the Impugned Order, Sh. Tarsem Singh had died on 20.04.2016 and his son Sh. Preet Pal Singh had died on 20.01.2004. Smt. Prem Kaur is wife of Sh. Tarsem Singh. Smt. Anju Dheeman is wife of late Sh. Preet Pal Singh, deceased son of Sh. Tarsem Singh, and her children are Sh. Japneet Singh and Smt. Bhavneet Deeman. The Appellant herein are daughters of Sh. Tarsem Singh and Respondent No. 3 is son of Sh. Tarsem Singh and Respondent No. 2 is wife of the son of Sh. Tarsem Singh.
2, except mentioning name of late Sh. Tarsem Singh in para 8. While rejecting the Application, NCLT had observed as under:

“8. Heard, record has been thoroughly perused. Admittedly, it is nowhere established that after the demise of Late Sh. Preet Pal Singh, the proposed applicants ever applied for transmission of shares on their names or their names were recorded in the register of members of the company. Further, the proposed applicants and the petitioner also failed to establish that apart from the present applicants, there is no other legal heir of the deceased shareholders. No succession certificate or any registered Will or probate has ever been placed on record to show the entitlement of applicants regarding the said shares of Late sh. Preet Pal Singh and Late Sh. Tarsem Singh respectively. Thus, there is no iota of evidence to establish that the present applicants are legally entitled to have those shares and have actually devolve upon them. (sic)
9. In view of the aforesaid discussions, this tribunal is of affirm view that the present applicants are failed to establish their rights over the said shares of deceased Mr. Preet Pal Singh, therefore, the applicants are not entitled to be impleaded at the arrays of petitioners. (sic) Resultantly, the present application for impleadment stands dismissed with no orders to costs.”

6. In the instant Appeal, the Appellants have sought to be impleaded and added as party in C.P. No.129/2019, which is still pending before NCLT. It is submitted that Appellant No. 1 is having 500 shares of nominal value of Rs. 10/- each in the Respondent No. 1 Company. It is submitted that Appellant No. 2 is having 1,000 shares of nominal value of Rs. 10/- each in the
Respondent No. 1 Company. It is submitted that Appellant No. 1 holds approximately 0.48% shares and Appellant No. 2 holds approximately 0.96% shares in the Respondent No. 1 Company, respectively.
7. It is submitted that Company Petition No. 129/2019 has been filed bringing out acts of Oppression and Mismanagement by the Respondent No. 1 Company and its Directors, namely Respondents No. 2 and 3 thereby seeking relief for removing and disqualifying the Directors who have been illegally appointed. It was pleaded that joining of the Appellants will enable the Tribunal to effectually and completely adjudicate upon and settle all the questions involved in the C.P. No. 129/2019. It was submitted that their Application CA No. 04/2021 was rejected by NCLT without giving any observations or dealing with the shares held by the Appellants 1 and 2. It was submitted that the Appellants want to become necessary parties as Petitioners
in C.P. No. 129/2019 to support the Petition and the Prayers made therein. It was submitted that if they are allowed to join Petitioner in C.P. No. 129/2019, their ownership of shares clubbed with the shares held by Smt. Prem Kaur well together constitute more than 11% shares in the Respondent No. 1 Company, which will make the Applicants in C.P. No. 129/2019
competent to prosecute the said Company Petition without waiver Application.
8. It was submitted on behalf of the Appellants that the acts of Oppression and Mismanagement have been committed by the Respondents No. 2 and 3 as the Additional Director appointed another Additional Director without calling or intimating the Shareholders about any General Meeting and both the Additional Directors illegally changed their designation as Director on the
very next date of their appointment as Additional Director. It was submitted that the Respondent has done illegal appointment and also the offence of forging the documents against which FIR No. 15/2022 has been registered in P.S., Paharganj under Section 420/34 of IPC. It was submitted by the Appellants that any person concerned with the affairs of the Company can be arrayed as a party to the proceedings, if such addition is likely to facilitate an effective, efficacious, just and fair adjudication of the case. The Appellants relied upon the Judgement of Chennai Bench passed by this Tribunal in the case of `P J Mathews’ Vs. `C. Mohanan Pillai’, in Comp. App. (AT) (CH) No. 22/2021.
9. In their Reply and Written Submissions, Respondents No. 1 to 3, have submitted that the Application CA No. 4/ND/2021 was filed surreptitiously by the Applicants for impleadment to enable them to clear the threshold shareholding prescribed in Section 244 while their waiver Application under proviso of Section 244 was pending. It was submitted that the Appellants have failed to satisfy the basic requirement of Sections 241 and 242 of the Act which is pointing out any oppressive act alleged to be committed by the Respondents while seeking impleadment. It was submitted that impleadment has been sought at a time when the Limitation period has already lapsed and they are barred to file the main Petition as such no cause of action has even arisen in favour of the Appellants. The Respondents have relied upon the following Judgements in support of their contentions:
• `Cyrus Investments Pvt. Ltd.’ Vs. `Tata Sons Ltd.’, C.A. No. 26 of 2017, in C.P. No. 82 of 2016
• `Shanti Prasad Jain’ Vs. `Kalinga Tubes Ltd.’, AIR 1965 SC 1535.
• `L.R.M.K. Narayanan’ Vs. `The Puthuthotam Estates’, 1991 SCC OnLine Mad 445.
• `Aurosagar Estates Pvt. Ltd.’ Vs. `M.C. Dawar Holdings Pvt. Ltd.’, 2017 SCC OnLine NCLAT 372.

• `Arvind Bali’ Vs. `Union of India, Ministry of Corporate Affairs and Videocon Telecommunications Limited’, Comp. App. (AT) No. 110 of 2021 or (2021) ibclaw.in 642 NCLAT.

Judgement of the Hon’ble Supreme Court in `Anil Kumar’ Vs. `Shivnath Mishra’, (1995) 3 SCC 147, to support their contention that their impleadment will be necessary in order to enable the Court to effectually and completely adjudicate upon and settle all questions involved in the Company Petition No. 129/2019.
11. Through our Order dated 20.11.2023, we had given liberty to the both sides to file Written Submissions/Additional Written Submissions, not exceeding five pages, alongwith relevant case laws, if any, within one week. However, till date no such Written Submissions/Additional Written Submissions have been filed in compliance to the said directions.

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“18. To be noted, that any person ‘concerned with the affairs of the Company’ can be arrayed as a ‘party’ to the proceedings, if such adding, as Respondent would facilitate an ‘effective’, ‘efficacious’, ‘just and fair adjudication’ of the case. It must be borne in mind that on the date of the filing of the Petition, the Respondent must either be a ‘Shareholder’ or ‘Director’ of the Company. However, if a person is a proper and necessary party, he can be arrayed as a ‘party’ in a given proceedings.
19 It is relevantly pointed out that a ‘Tribunal’ has the requisite power to add or strike out a party at any stage of a given proceedings, in the considered opinion of this ‘Appellate Tribunal’. Further, in Law, to bring a person as a Party/Respondent/Defendant in a given case/legal proceedings is not a ‘Substantive Right’ but one of ‘procedure’ and the ‘Tribunal’ in this regard, is to exercise its sound judicial discretion. To determine whether a ‘person’ is to be impleaded or otherwise, cannot depend mainly on the aspect as to whether he has an interest in the property, but whether a right of a person would get affected, if not impleaded in a given pending legal proceedings before the ‘Competent Forum’. As a matter of fact, the ‘Tribunal’ can permit even the impleadment of third party, if his/its presence is necessary for adjudication of the subject matter in issue.
20. It is to be pointed out that to resolve the controversies/issues concerning the main Company Petition in a satisfactory manner, a party may be arrayed as one of the Respondents, of course, based on the facts and circumstances of a particular case. Moreover, it is not necessary that ‘any relief’ should be asked against a ‘proper party’ sought to be impleaded or arrayed as one of the parties to the pending litigation. A ‘proper party’ is added to avoid plurality of given proceedings and to protect its interest. To put succinctly, a person who is not a party has no right to be impleaded against the Petitioner/Plaintiff’s wishes in a given pending legal proceedings. But the rider is that if a person is proper and necessary party, he can be added as a party, either as one of the ‘Petitioners’ or as one of the ‘Respondents’, as the case may be.
21. Be that is it may, in the instant case on hand, the fact that First Respondent/Applicant being a shareholder of the 9th Respondent/Company (First Respondent in the main Company Petition CP 21/KOB/2020) is not in dispute. It cannot be brushed aside that in the main Company Petition, the Appellants/Petitioners had alleged ‘mismanagement’ and ‘oppression’ in the Company. Suffice it for this Tribunal to make significant mention that ‘on the date of filing of the Petition’, the First Respondent/Applicant being a shareholder of the 9th Respondent/Company (First Respondent/Company in the main Company Petition CP/21/KOB/2020) and this Tribunal bearing in mind an important fact that the Appellants/Petitioners in the main Company Petition had come out with allegation of mismanagement and oppression in the Company etc, this Tribunal comes to a consequent conclusion that the First Respondent/ Applicant is really a person ‘concerned with the affairs’ of the Company and without his presence, no effective order can be passed by the ‘Tribunal’ in a complete, comprehensive and satisfactory manner. Therefore, the 1st Respondent/Applicant’s impleadment as Respondent No.23 in the main Company Petition No.21/KOB/2020, as ordered by the National Company Law Tribunal, Kochi Bench in the ‘Impugned order’ dated 15.03.2021 in CA/23/KOB/2021 is legally tenable. Viewed in that perspective, the ‘instant Appeal’ is devoid of merits.”

14. The Appellants are Shareholders of the Respondent No. 1 Company and are family members of the other Shareholders. They are concerned with the affairs of the Company and their arraignment as party to the proceedings would facilitate an effective, efficacious, just and fair adjudication of the case. We hold that they are proper and necessary party and their impleadment will assist in arriving at the correct decision in C.P. No. 129/ND/2019 pending with NCLT.