SC Overturns NCLAT Order; Demands Compliance and Investigation into Actions; AGM Results to be Declared Promptly.

The SC set aside NCLAT's order that restored the status quo ante, emphasizing adherence to its directives. The scrutinizer was instructed to declare the AGM results of 29 September 2023 promptly. An enquiry into NCLAT's actions was ordered, with a report due by 16 October 2023. The Contempt Petition was scheduled for 17 October 2023, addressing the alleged defiance of the SC's order by NCLAT. The personal presence of the contemnor(s) was dispensed with, pending further directions.

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Issues involved: Contempt of court by the National Company Law Appellate Tribunal (NCLAT) by delivering a judgment despite a specific order from the Supreme Court, violation of court orders, conducting an enquiry into the actions of NCLAT judges, and listing a Contempt Petition.

Contempt of Court by NCLAT: The Supreme Court set aside the NCLAT's order directing restoration of the status quo ante after the conclusion of arguments and reservation of judgment. The Court emphasized that actions taken would abide by the final result of proceedings before NCLAT. The Court observed that deferring the declaration of the result until a judgment is rendered would defeat the mandate of its order. Consequently, the Court issued a notice returnable on 30 October 2023, dispensing with the personal presence of the contemnor(s) subject to further directions. The scrutinizer was directed to declare the result of the Annual General Meeting held on 29 September 2023 promptly, and NCLAT was instructed to declare its judgment after being informed of the meeting's result.

Enquiry into NCLAT's Actions: Counsel for the petitioner informed the Court that despite a request not to deliver the judgment until the scrutinizer's report was available, the NCLAT proceeded to deliver the order. The Court noted that this could constitute defiance of its order by the NCLAT. An enquiry was directed to be conducted by the Chairperson of the NCLAT to verify the circumstances under which the judges proceeded to pronounce the judgment despite the Supreme Court's order. A report was to be submitted by 16 October 2023, specifically verifying the facts from the judges who constituted the NCLAT bench.

Listing of Contempt Petition: In response to the extraordinary circumstances and urgent mentioning, the Court directed the listing of the Contempt Petition on 17 October 2023. This decision was made to address the alleged defiance of the Supreme Court's order by the NCLAT and to ensure accountability for the actions taken by the NCLAT judges.

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