Proper and necessary parties may be impleaded to avoid duplicate proceedings and secure effective adjudication in company disputes.

Applicants with earlier shareholdings, whose grievance arose from the same allotments and cancellations as the main company petition, were found to be proper and necessary parties. The Tribunal held that impleadment was warranted to avoid parallel proceedings on the same cause of action and to ensure effective adjudication of the dispute. As no prejudice to any party was shown, the applicants were permitted to be impleaded as petitioners in the pending company petition.

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Issues: Whether the applicants were proper and necessary parties to be impleaded as petitioners in the pending company petition.

Analysis: The applicants had earlier shareholdings and their grievance arose from the same set of allotments and cancellations that formed the subject matter of the main company petition. The Tribunal held that proper and necessary parties should be brought on record to avoid separate proceedings on the same cause of action and to enable effective adjudication of the dispute. It found that allowing impleadment would not prejudice any party and would facilitate a comprehensive decision.

Conclusion: The applicants were held to be proper and necessary parties and were permitted to be impleaded as petitioners in the company petition.

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