Appellate Tribunal overturns NCLT decision, remands case for further proceedings.

The Appellate Tribunal allowed the appeal, set aside the NCLT's order, and remanded the matter back to the Tribunal for disposal on merits. The Tribunal directed the parties to appear before the NCLT for further proceedings and disposed of the application for interim reliefs, directing the Appellants to pursue the reliefs before the Tribunal. The appeal was allowed with no order as to costs.

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Issues Involved:
1. Maintainability of the Company Petition under Section 244 of the Companies Act, 2013.
2. Requirement of written consent for filing a Joint Petition.
3. Validity of General Power of Attorney (GPA) for providing consent.
4. Non-compliance with procedural rules and its impact on the maintainability of the petition.

Issue-wise Detailed Analysis:

1. Maintainability of the Company Petition under Section 244 of the Companies Act, 2013:
The Appellants filed a petition under Sections 241 and 242 of the Companies Act, 2013, alleging oppression and mismanagement by Respondents. The National Company Law Tribunal (NCLT) dismissed the petition, stating it did not meet the threshold criteria under Section 244. The Appellants argued that they collectively held more than 1/10th of the total number of members, thus meeting the threshold. The Tribunal found that the Appellants' claim of holding 42.76% of shares was based on disputed shares, and they only held 25.55% of the shares. The Appellate Tribunal concluded that the Appellants met the requirement of holding 1/10th of the total paid-up share capital, thus fulfilling the criteria under Section 244(1) of the Act.

2. Requirement of written consent for filing a Joint Petition:
The Respondents contended that the Appellant No. 1 had not obtained written consent from Appellant Nos. 2 and 3 before filing the petition, as mandated by Section 244(2) of the Act. The Appellants argued that the GPA executed by Appellant Nos. 2 and 3 in favor of Appellant No. 1 authorized him to file the petition. The Tribunal held that non-filing of the written consent along with the petition would not ipso facto result in its dismissal. The Appellate Tribunal referred to the Supreme Court's judgment in J.P. Srivastava Vs. Gwalior Company Sugar Ltd., which held that the requirement of filing consent letters is not mandatory and non-compliance can be cured subsequently.

3. Validity of General Power of Attorney (GPA) for providing consent:
The Tribunal doubted the validity of the GPA, suggesting it might have been executed after filing the petition. The Appellants argued that the GPA was executed before filing the petition and was notarized on 04.04.2019. The Appellate Tribunal found no evidence of the GPA being backdated or forged, and the Appellant Nos. 2 and 3 did not deny its execution. The Tribunal concluded that the GPA was valid, and Appellant No. 1 was competent to file the petition on behalf of Appellant Nos. 2 and 3.

4. Non-compliance with procedural rules and its impact on the maintainability of the petition:
The Respondents argued that non-compliance with Rule 81 of the NCLT Rules, 2016, which requires the consent letters to be annexed with the petition, rendered the petition non-maintainable. The Appellate Tribunal referred to Rule 58 of the NCLT Rules, which states that failure to comply with procedural requirements shall not invalidate proceedings unless it results in a miscarriage of justice. The Tribunal held that non-compliance with Rule 81 did not invalidate the petition, and such defects could be cured subsequently.

Conclusion:
The Appellate Tribunal allowed the appeal, set aside the NCLT's order, and remanded the matter back to the Tribunal for disposal on merits. The Tribunal directed the parties to appear before the NCLT for further proceedings and disposed of the application for interim reliefs, directing the Appellants to pursue the reliefs before the Tribunal. The appeal was allowed with no order as to costs.

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