Dismissal of Writ Petition Challenging NCLAT Member Appointment

The court dismissed the writ petition challenging the appointment of Respondent No.2 as Technical Member of NCLAT. The appointment was found to be valid and in compliance with the Companies Act, 2013. The court imposed costs on the petitioner for concealing facts and lacking standing to file the petition.

---

---

Issues Involved:
1. Validity of the appointment of Respondent No.2 as Technical Member of NCLAT.
2. Compliance with the amended Section 411(3) of the Companies Act, 2013.
3. Petitioner's locus standi and credibility.

Issue-wise Detailed Analysis:

1. Validity of the appointment of Respondent No.2 as Technical Member of NCLAT:
The petitioner sought a writ of quo warranto questioning the authority under which Respondent No.2 held the office as Technical Member of NCLAT. The petition argued that the appointment was ultra vires the amended Section 411(3) of the Companies Act, 2013, and not in accordance with the Supreme Court's judgment in Madras Bar Association vs. Union of India (2015) 8 SCC 583. The petitioner contended that Respondent No.2 did not meet the eligibility criteria post the amendment effective from 09.02.2018.

2. Compliance with the amended Section 411(3) of the Companies Act, 2013:
The petitioner argued that the eligibility criteria for the appointment of Technical Members were not in consonance with the amended Section 411(3), which excluded experience 'in law'. The learned Additional Solicitor General, representing the respondents, countered that the appointment was in line with the law and the Supreme Court's directives. The process included a Search-cum-Selection Committee chaired by the Chief Justice of India, and the Appointments Committee of the Cabinet (ACC) approved the appointments. It was emphasized that Respondent No.2 had the requisite experience and qualifications, having served as a Judicial Member in various forums since 2015.

3. Petitioner's locus standi and credibility:
The respondents questioned the petitioner's locus standi, highlighting that the petitioner's status as a company was 'inactive' and its license under Section 8 of the Act had been cancelled. The petitioner was legally debarred from using its name, 'India Awake for Transparency', and was involved in investigations by the Serious Fraud Investigation Office (SFIO). The court found merit in these contentions, noting that the petitioner had concealed crucial facts and lacked the standing to file the petition.

Judgment:
The court dismissed the writ petition and all pending applications, stating that the petitioner failed to establish a case against the appointment of Respondent No.2. It was held that the selection and appointment process was conducted in accordance with the law, and there were no allegations of bias or malafides against the Selection Committee or the ACC. The court also imposed costs of Rs. 25,000 on the petitioner for suppression of facts and lack of locus standi, to be deposited with the Delhi State Legal Services Authority.

Conclusion:
The judgment upheld the validity of Respondent No.2's appointment as Technical Member of NCLAT, confirmed compliance with the amended Section 411(3) of the Companies Act, 2013, and dismissed the petition due to the petitioner's lack of credibility and locus standi.

---