Interlocutory company law orders are appealable only for legal error, perversity, or arbitrariness, not merits review.

An interlocutory status quo order of the Company Law Board in an oppression and mismanagement matter was held not to warrant appellate interference under section 10F unless it raised a question of law or showed perversity, arbitrariness, or patent legal error. Because the order was a temporary, prima facie measure passed at a preliminary stage while pleadings and impleadment were still pending, the challenge sought an impermissible merits review. The appeal was therefore not maintainable, the interim restraint remained in force, and the Board was left free to proceed with the pending application and main petition according to law.

---

---

Issues: (i) Whether an appeal under section 10F of the Companies Act, 1956 lay against an interim status quo order passed by the Company Law Board in an oppression and mismanagement proceeding.

Analysis: The order under challenge was an interlocutory arrangement passed at a preliminary stage, while the application for impleadment was still pending and pleadings were incomplete. The Company Law Board had acted on a prima facie view that the company's affairs had been conducted prejudicially and had granted temporary protection to preserve the subject property pending fuller consideration. An appeal under section 10F lies only where a question of law arises from the decision impugned. In the case of an interim discretionary order, appellate interference is limited and is warranted only where the order is shown to be perverse, arbitrary, or contrary to settled legal principles. No such infirmity was shown, and the challenge invited a merits review beyond the permissible scope of interference at that stage.

Conclusion: The appeal was not maintainable and the interim restraint order was not interfered with.

Final Conclusion: The challenge to the interlocutory order failed, and the Company Law Board was left free to proceed with the pending application and main petition in accordance with law.

Ratio Decidendi: A discretionary interlocutory order of the Company Law Board is appealable under section 10F only if it gives rise to a question of law, and appellate interference is confined to cases of perversity, arbitrariness, or patent legal error.

---