2023 (11) TMI 969 - AT - Companies Law

Tribunal correctly dismissed oppression case after parties reached settlement through compromise deed despite appellant's challenge

Ram Avtar Yadav, Ram Rati Versus M/s H.S. Realty Pvt. Ltd., Mahender Singh Yadav, Savitri Devi, Anil Yadav, Sunita Yadav, Sunil Yadav

NCLAT dismissed appeal challenging tribunal's order in oppression and mismanagement case. Appellant challenged reduction of shareholding and unauthorized ... Oppression and mismanagement - Reduction of shareholding of the Appellant No. 1 - sale of properties of the Respondent NO. 1 Company without the consent of the Appellant No. 1 - jurisdictional error - mutual settlement of disputes between parties - HELD THAT:- The Tribunal passed the impugned order after duly considering that the jurisdiction of the Tribunal cannot be invoked for giving effect to a compromise between the parties. The impugned order does not suffer from any jurisdictional error and the Tribunal, by passing of the impugned order, ensured that there is no multiplicity of proceedings between the parties. The Tribunal comprehensively dealt with the issues mentioned in the Company Petition. The impugned order was passed on the ground that the parties had already mutually settled their disputes. In view of the mutual settlement, the Company Petition ought to have been dismissed which the Tribunal rightly did by way of the impugned order. The Appellants’ contention that till the amounts mentioned in the minutes dated 31.05.2018 are not paid, there is a continuous cause of oppression and mismanagement is completely misconceived and unsustainable. The Tribunal and this Appellate Tribunal are not the appropriate forums for adjudicating as to whether the parties have acted in terms of the compromise deed dated 11.04.2018 and whether the alleged minutes dated 31.05.2018 are binding or not - The Hon’ble High Court being seized of the matter, the present Appeal is liable to be dismissed. Further, it has been rightly noted by the tribunal that in the light of the compromise deed dated 11.04.2018, if at all there is any remedy available to the Appellant then it is before the Hon’ble Punjab & Haryana High Court and Civil court at Gurugram. Thus, the Tribunal while passing the impugned order had rightly taken note of the fact that in view of the settlement between the parties, the said allegations cannot be gone into further and in the circumstances in view of the compromise arrived at outside the Tribunal and nothing survives in the Company Petition. Appeal dismissed. Issues Involved:1. Allegations of oppression and mismanagement.2. Validity of the compromise deeds and their impact on the company petition.3. Jurisdiction of NCLT in light of existing settlements.Summary:1. Allegations of Oppression and Mismanagement:The appellants filed a company petition alleging oppression and mismanagement by the respondents, including reduction of shareholding and unauthorized sale of company properties. They sought various reliefs, including declaring board meetings and share allotments as null and void, rectification of the register of members, appointment of an independent auditor, and injunctions against the respondents.2. Validity of Compromise Deeds:The respondents argued that a compromise deed dated 11.04.2018, supplemented by another deed dated 31.05.2018, settled the disputes between the parties. The NCLT dismissed the company petition on the grounds that the compromise deed resolved the issues, and the petition could not be entertained further. The appellants contended that the NCLT failed to consider the subsequent compromise deed and the continuous nature of oppression and mismanagement.3. Jurisdiction of NCLT:The NCLT noted that the disputes had been settled through compromise deeds recorded by the Hon'ble High Court of Punjab & Haryana and the Ld. Civil Judge, Gurugram. The NCLT held that it could not entertain the company petition in light of the settlements. The appellants argued that the NCLT abdicated its jurisdiction and failed to address the continuous oppression and mismanagement.Conclusion:The appellate tribunal affirmed the NCLT's order, agreeing that the settlement between the parties, as recorded by the Hon'ble High Court of Punjab & Haryana and the Ld. Civil Judge, Gurugram, rendered the company petition moot. The appeal was dismissed, and no order as to costs was made. The registry was directed to upload the judgment on the website and send a copy to the concerned tribunal.