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D. Y. CHANDRACHUD, M. R. SHAH
Surender Kumar Gupta – Appellant
Versus
J. M. Housing Limited – Respondent
ORDER
1. The appellants filed a petition under Sections 241 and 242 of the Companies' Act 2013, complaining of oppression and mismanagement. An ex-parte order was passed by the National Company Law Tribunal on 5 October 2020. Instead of moving the NCLT for vacating the ad-interim order, the respondents moved the National Company Law Appellate Tribunal in appeal. The NCLAT by its impugned order dated 18 December 2020 set aside the order of the NCLT on the ground that it was passed in violation of the principles of natural justice. Having made this observation, the NCLAT has also made certain observations on merits and remitted the matter to the NCLT for de novo consideration on merits after providing an opportunity of being heard to the parties.
2. We have heard Mr Rakesh Kumar, learned counsel appearing on behalf of the appellants and Mr Shyam Divan, learned senior counsel appearing for the first respondent with Mr P K Mittal.
3. The appropriate course of action for the respondents, faced with an ex-parte order of the NCLT would have been to apply to the NCLT for vacating or modifying the ad-interim order. The NCLAT was not correct in coming to the conclusion that the order of the
Points of law : Principle which has been propounded by the NCLAT is rather novel to civil jurisprudence and betrays a lack of comprehension of basic legal principles.
Order passed contrary to rules and in violation of natural justice is liable to be set aside.
The court reiterated that interim orders protecting rights pending final adjudication are crucial, and only appealable orders determining rights of parties fall under the Companies Act, 2013.
The court emphasized the need for justification in issuing interim directions and linked the appointment of the Executive Chairperson to the outcome of the pending appeal before the NCLAT.
A court may limit the duration for compliance with tribunal orders pending appeal, emphasizing the importance of timely appeals and interim relief.
The necessity of reasoned orders in judicial proceedings is mandated, as a non-speaking order is void and impacts the legality of such decisions.
Courts emphasize the importance of addressing grievances about the implementation of their orders directly to the court, rather than seeking alternative remedies.
Judicial orders, particularly those granting injunctions, must be reasoned and demonstrate the application of legal standards to the facts; failure to do so violates principles of natural justice.
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