Compounding fee procedure under company law requires notice and hearing before fixation, with stay continuing pending disposal.

Before fixing compounding fees under Section 621A of the Companies Act, 1956, notice and an opportunity of hearing were to be issued and the prescribed procedure followed. On the affidavit undertaking compliance with that procedure, the proceedings were closed without further adjudication. The interim stay was directed to continue until disposal of the compounding application.

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Issues: Whether the Company Law Board was required to issue notice and afford a hearing before fixing compounding fees under Section 621A of the Companies Act, 1956, and whether the appeal required further adjudication in view of the affidavit undertaking compliance with the prescribed procedure.

Outcome: The proceedings were closed after recording the undertaking that hearing notices would be issued and the prescribed procedure would be followed before fixing compounding fees. The interim stay was directed to continue until disposal of the compounding application.

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