TaxTMI 
TaxTMI 
2021 (5) TMI 707
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....greement dated January 20, 2020; (ii) Grant liberty to the Petitioners to withdraw the Company Petition No. 11/JPR/2018 in terms of settlement arrived at between the parties; (iii) In view of Clause 2.1 of the Settlement Agreement, grant waiver/exemption to the Petitioners and the Respondent No. 1 Company from penalty(ies) qua inadvertent violations committed in the shares allotments as mentioned under Para 5 and do all that necessary pursuant to the said allotments being null and void including but not limited to allowing rectification of register of Respondent No. 1 Company under Section 59 of the Act in accordance with the submission at Para 7 of the present application; (iv) In view of Clause 2.2 of the Settlement Agreement, grant waiver/exemption from compounding of irregular appointment of Petitioners No. 1 & 2 and Respondent No. 4 as Directors of Respondent No. 1 Company as mentioned under Para 10; (v) Pass such other order(s) as this Hon'ble Tribunal may deem fit and proper in the facts and circumstances of the case. Similarly, IA No. 315/JPR/2020 in CP No. 279/JPR/2019 also seeks the relief of decreeing the said Settlement Agreeme....
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.... as Annexure-P2 (Colly). 8. It is stated in the instant Application that the Respondent No. 1 Company took cognizance of the aforesaid illegal share allotments and declared these allotments void ab-initio in the board meeting held on 30.07.2018. However, this Tribunal had granted status quo ante vide order dated 09.08.2018, in relation to directorship and shareholding of Respondent No. 1 Company as it existed prior to 30.07.2018, and had stayed the resolutions passed in the said board meeting for setting aside the wrongful share allotments. 9. The above-mentioned order of this Tribunal dated 09.08.2018 was challenged at the Hon'ble National Company Law Appellate Tribunal, New Delhi ('NCLAT') in Company Appeal No. 323 of 2018, preferred by the Respondents. The Hon'ble NCLAT vide its order dated 01.10.2019 had set aside the order dated 09.08.2018 of this Tribunal. Consequently, the alleged irregular share allotments made by the Respondent No. 1 Company stand cancelled and hence at present, the actual paid-up equity share capital of the Respondent No. 1 Company, stands at INR 1,00,000/- (Rupees One Lac only) divided into 10,000 (Ten Thousand) equity shares of Rs.....
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....to limit or otherwise affect the inherent powers of the Tribunal to make such orders as may be necessary for meeting the ends of justice or to prevent abuse of the process of the Tribunal. 82. Withdrawal of Application fled under section 241 (1) An application under clause (a) or clause (b) of sub-section (1) of section 241 of the Act, shall not be withdrawn without the leave of the Tribunal. (2) An Application for withdrawal under sub-rule (1) shall be filed in the Form NCLT-9. " Rule 11 of the NCLT Rules supplements extensive powers of the Tribunal to decide applications under Sections 241 - 242 of the Act for safeguarding the interests of the Company, its shareholders and the public in general. Appropriate interim and final orders in matters of Sections 241-242 may not be shackled by other provisions of the Act. Sections 241-242 correspond to Sections 397-398 and 402 of the Companies Act, 1956, under which there are many precedents in such regard. 16. The Hon'ble Supreme Court in case of Cosmosteels Private Ltd. & Ors. vs. Jairam Das Gupta & Ors. reported in AIR 1978 SC 375; while considering whether reduction of share capital of a Comp....
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....red upon the court "to make such orders as it thinks fit" if it comes to the conclusion that the affairs of the company are being conducted in a manner prejudicial to public interest or in a manner prejudicial to the interests of the company or that a material change has taken place in the management or control of the company by reason of which it is likely that the affairs of the company will be conducted in a manner prejudicial to public interest or in a manner prejudicial to the interests of the company, "with a view to bringing to an end or preventing the matters complained of or apprehended". Both the wide nature of the power conferred on the court and the object or object sought to be achieved by the exercise of such power are clearly indicated in sections 397 and 398. " 19. Further, in the matter of Lakhani (India) Limited (C.P. No. 73 of 2006). The Hon'ble Company Law Board (CLB) Principal Bench, used its wide power under Section 402 of the Companies Act, 1956 and took into consideration a Memorandum of Family Settlement and Arrangement on 20.05.2008 thus putting an end to long-standing disputes and differences. The Hon'ble CLB inter-alia observed- "(3) ....
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....y arising out of the common issues and seeks withdrawal of CP 2, pivoted on the common Settlement Agreement. 23. On careful perusal of the abovementioned facts, documents placed on record and judgments passed by various judicial authorities, while deciding in the interests of the Company and its stakeholders; this Tribunal orders the following: (i) The Settlement Agreement dated 20.01.2020 is taken on record and liberty is granted to the Applicants in IA 316/JPR/2020 and IA No. 315/JPR/2020 to withdraw the corresponding Company Petitions, i.e. CP No. 11/JPR/2018 and CP No. 279/JPR/2019; (ii) In view of antecedent circumstances of the cross-petitions under Sections 241-242 of the Act and the amicable mutual settlement by and between the parties, it is in order that a conclusion is reached in the matter. In view of the powers of the Tribunal in such matters as enunciated in judicial precedents in this regard, IA No. 316/JPR/2020 and IA No. 315/JPR/2020 are disposed of along with the corresponding CPs in terms of the aforesaid mutual Settlement Agreement dated 20.01.2020; (iii) No action shall be taken against Respondent No. 1 Company or its past/incumben....