Court sets aside CLB's order, limits powers under section 247(1A). Emphasizes procedural propriety and natural justice.

The court set aside the CLB's interim order, emphasizing that CLB's powers under section 247(1A) should be exercised only in relation to the company subject to proceedings before it. The court directed the CLB to decide pending applications in accordance with the law and principles of natural justice, highlighting that directions must comply with procedural propriety and principles of natural justice.

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Issues Involved:
1. Allegations of oppression and mismanagement under sections 397-398 of the Companies Act, 1956.
2. Validity of the agreement dated 30.01.2013 and subsequent addendums.
3. Exercise of suo moto powers by the Company Law Board (CLB) under section 247(1A) of the Companies Act.
4. Procedural propriety and principles of natural justice in CLB's interim orders.

Detailed Analysis:

1. Allegations of Oppression and Mismanagement:
The respondent filed a Company Petition alleging oppression and mismanagement by certain individuals in respect of M/s Positiv Television Pvt. Ltd. (PTPL) and other group companies. The respondent sought relief including the declaration of certain share allotments as null and void and challenged her removal as a Director of PTPL. The CLB initially directed a status quo regarding the fixed assets and shareholdings of the respondent companies.

2. Validity of the Agreement Dated 30.01.2013 and Subsequent Addendums:
The CLB found that the agreement dated 30.01.2013 between PTPL and WIPL aimed at a complete takeover of PTPL by WIPL was fraudulent, mischievous, and in breach of previous orders. The CLB declared the agreement a nullity. The appellants contended that if the agreement was void, PTPL and the respondent must first restore the Rs. 150 Crores obtained from WIPL under the said agreement. The CLB's finding was challenged on the grounds that it was made without a proper hearing and violated principles of natural justice.

3. Exercise of Suo Moto Powers by the CLB under Section 247(1A):
The CLB exercised suo moto powers under section 247(1A) to direct an investigation into WIPL's affairs to determine the true persons financially interested in PTPL. The appellants argued that the CLB did not have the authority to direct such an investigation as WIPL was not the company in respect of which the proceedings were pending. The court held that section 247(1A) applies only to the company that is the subject matter of the proceedings before the CLB, and the CLB's direction for investigation into WIPL's affairs was not sustainable.

4. Procedural Propriety and Principles of Natural Justice:
The appellants contended that the CLB issued directions without notice or hearing, violating principles of natural justice. The court found that the CLB's directions, including the appointment of a nominee director on PTPL's Board and restrictions on board meetings and shareholdings, were made without affording an opportunity to the affected parties. The directions were beyond the scope of the application for impleadment and not sustainable.

Conclusion:
The court set aside the CLB's interim order dated 09.05.2014, directing the CLB to decide the pending applications in accordance with law and principles elucidated in the judgment. The court emphasized that the CLB's powers under section 247(1A) should be exercised only in respect of the company that is the subject matter of the proceedings before it, and any directions should comply with the principles of natural justice.

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