Tribunal grants waiver for Companies Act petition amid oppression and mismanagement claims

The Tribunal dismissed all three appeals, granting a waiver of clause (a) and (b) of section 244 for the original applicant to file a petition under section 241 of the Companies Act, 2013. The Tribunal found exceptional circumstances warranting the waiver in the interest of justice, allowing the applicant to pursue relief for alleged oppression and mismanagement by the respondents. The pending civil suit with similar claims did not preclude the waiver application. Appellant no. 5, a third-party purchaser, was considered to have a role justifying the grant of waiver.

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Issues Involved
1. Waiver of clause (a) and (b) of section 244 to file a petition under section 241 of the Companies Act, 2013.
2. Allegations of oppression and mismanagement.
3. Validity of the application for waiver and whether exceptional circumstances exist.
4. Pending civil suit and its impact on the waiver application.
5. Role and involvement of appellant no. 5 in the company’s affairs.

Detailed Analysis

1. Waiver of Clause (a) and (b) of Section 244
The primary issue was whether the original applicant made out a case for waiver of clause (a) and (b) of section 244 to file a petition under section 241 of the Companies Act, 2013. The NCLT found that the Legislature has set a minimum criterion under section 244 for making an application under section 241, but the Tribunal has the power to waive this criterion to do substantial justice. The Tribunal concluded that the case was exceptional and warranted a waiver in the interest of justice.

2. Allegations of Oppression and Mismanagement
The original applicant, holding 6.62% of the paid-up equity capital, alleged several acts of oppression and mismanagement by the respondents. These included the unjustified issuance and buy-back of shares, efforts to demerge the company, and the sale of the company's software business on a slump sale basis. The applicant argued that these actions were designed to dilute its shareholding and prevent it from meeting the statutory requirements to file a petition for oppression and mismanagement.

3. Validity of the Application for Waiver and Exceptional Circumstances
The appellants argued that no special exceptional circumstances were made out for the grant of waiver. They cited the judgment in the matter of Cyrus Investments Pvt. Ltd. & Ors. Vs. Tata Sons Ltd. & Ors., which held that waiver could only be granted under "special and exceptional circumstances." The NCLT, however, found that the respondents had failed to provide explanations for several questionable actions, such as the buy-back of shares and the sale of the company's business. The Tribunal determined that the applicant had made out an exceptional case for waiver.

4. Pending Civil Suit and Its Impact on the Waiver Application
The appellants contended that the original applicant had filed a civil suit with identical averments, which was still pending. They argued that the remedy of a derivative action civil suit and a claim of oppression are inconsistent, and the applicant should be precluded from seeking relief before the NCLT. However, the Tribunal noted that the civil suit was objected to on the grounds that it was a case of oppression and mismanagement, which should be decided by the NCLT. Therefore, the pending civil suit did not bar the present application for waiver.

5. Role and Involvement of Appellant No. 5
Appellant no. 5 argued that it was not a shareholder or involved in the management of the company but was merely a bona fide third-party purchaser of the company's assets. The Tribunal found that when the substratum of the company has been transferred, it constitutes an exceptional circumstance justifying the grant of waiver.

Conclusion
The Tribunal dismissed all three appeals, finding that the original applicant had made out a case for waiver under section 244 of the Companies Act, 2013. The Tribunal emphasized that the issues raised by the appellants related to the merits of the case, which would be decided in due course. The waiver was granted to ensure that the applicant could seek relief for the alleged acts of oppression and mismanagement.

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