IN THE HIGH COURT OF DELHI AT NEW DELHI
Subramonium Prasad, J.
Siddharth Sahib Singh – Appellant
Versus
Apex Council of Ddca – Respondent
W.P.(C) 8634 of 2023 & CM APPLs. 32755 of 2023, 32804 of 2023,
Decided On : 10-07-2023
Appointment - Ombudsman - Companies Act, 1956 - Article 226 - 10.06.2023 - 10.04.2023
Fact of the Case:
The Secretary of the Delhi and District Cricket Association (DDCA) challenged the notice dated 10.06.2023, issued by the Apex Council of DDCA, for convening the Extra-Ordinary General Meeting (EGM) of the Members of the DDCA on 05.07.2023 at 09:00 AM at the registered office of the DDCA at the Arun Jaitley Stadium, Ferozshah Kotla Ground, New Delhi. The challenge was against the ratification of the resolution dated 10.04.2023 appointing Justice M M Kumar (Retd.), Former Chief Justice of High Court of Jammu & Kashmir as the Ombudsman cum Ethics Officer of the DDCA.
Finding of the Court:
The Court held that the petitioner should have approached the National Company Law Tribunal (NCLT) for redressal of grievances as the DDCA is a company incorporated under Section 8 of the Companies Act, 2013. The Court emphasized that the NCLT has the power to regulate the conduct of the company's affairs and make interim orders for regulating the conduct of the company's affairs upon such terms and conditions as it deems just and equitable.
Issues: The main issue was the maintainability of the Writ Petition under Article 226 of the Constitution of India, considering the availability of an equally efficacious alternative remedy before the NCLT.
Ratio Decidendi: The Court cited various provisions of the Companies Act, including Sections 241, 242, 244, and 245, to emphasize the power of the NCLT to redress the grievances raised by the petitioner. The Court also highlighted the discretionary nature of the writ remedy and the principle that the availability of an alternative remedy does not operate as an absolute bar to the maintainability of the writ petition.
Final Decision: The Court disposed of the Writ Petition and granted liberty to the Petitioner to approach the NCLT for the redressal of its grievances, emphasizing that it had not made any observations on the merits of the case.
JUDGMENT
Subramonium Prasad, J.
1. Petitioner herein, who is the Secretary of the Delhi and District Cricket Association (hereinafter referred to as `the DDCA') has approached this Court by filing the present Writ Petition under Article 226 of the Constitution of India challenging the notice dated 10.06.2023, issued by the Apex Council of DDCA, for convening the Extra-Ordinary General Meeting (hereinafter referred to as `the EGM') of the Members of the DDCA on 05.07.2023 at 09:00 AM at the registered office of the DDCA at the Arun Jaitley Stadium, Ferozshah Kotla Ground, New Delhi.
2. Shorn of unnecessary details, the facts, leading to the present Writ Petition are as under:
a. DDCA is a company incorporated under Section 8 of the Companies Act, 1956 (hereinafter referred to as `the Companies Act.). It is the governing body for cricket activities in the State of Delhi and the Delhi Cricket Team. The Apex Council of the DDCA is the principal body of the DDCA tasked with the governance of the affairs of DDCA.
b. It is stated that a Notice dated 10.06.2023 was issued by the Apex Council of the DDCA for convening the EGM of the Members of the DDCA on 05.07.2023 at 09:00 AM at the registered office of the DDCA for ratifying its resolution dated 10.04.2023 by which the Apex Council had appointed Justice M M Kumar (Retd.), Former Chief Justice of High Court of Jammu & Kashmir as the Ombudsman cum Ethics Officer of the DDCA. At this juncture it is pertinent to mention that. Justice Indu Malhotra (Retd.), Former Judge of the Supreme Court of India had been appointed as the Ombudsman cum Ethics Officer of the DDCA. Material on record indicates that Justice Indu Malhotra (Retd.) resigned from the post of Ombudsman cum Ethics Officer of the DDCA on 31.03.2023 pursuant to which Justice M M Kumar (Retd.) was appointed as the Ombudsman cum Ethics Officer of the DDCA by the Apex Council vide its Resolution dated 10.04.2023.
c. Petitioner herein is the Secretary of the Apex Council of the DDCA. It is stated that the Resolution dated 10.04.2023, appointing Justice M M Kumar (Retd.), Former Chief Justice of High Court of Jammu & Kashmir as the Ombudsman cum Ethics Officer of the DDCA had been passed clandestinely and is, therefore, invalid and the notice calling for a meeting for ratification of the said Resolution should be quashed and set aside.
3. Mr. Rahul Mehra, learned Senior Counsel appearing for the Petitioner, has taken this Court through various provisions of the Articles of Association of the DDCA to contend that the notice dated 10.06.2023 calling for an EGM of the Members of the DDCA on 05.07.2023 at 09:00 AM at the registered office of the DDCA for ratifying its resolution dated 10.04.2023 by which the Apex Council had appointed Justice M M Kumar (Retd.), Former Chief Justice of High Court of Jammu & Kashmir as the Ombudsman cum Ethics Officer of the DDCA is completely contrary to the procedure laid down in the Articles of Association of the DDCA. He contends that Article 1(f) of the Articles of Association (hereinafter referred to as `AoA.) defines the Apex Council as the principal body of the DDCA tasked with the governance of the DDCA as set out in Article 17 of the AoA. He then takes this Court through Article 10 of the AoA which lays down the rules regarding conduct of the Annual General Meeting of the General Body of the Apex Council. Article 10(1) of the AoA stipulates that the Annual General Meeting of the General Body shall be held every year, not later than 30th September, at such place and time as the President may fix. Mr. Mehra then draws the attention of this Court to Article 10(5) of the AoA which stipulates the businesses that have to be transacted only at the Annual General Meeting of the General Body of the DDCA. He states that Article 10(5)(f) of the AoA provides that the Ombudsman cum Ethics Officer of the DDCA can be appointed only at the Annual General Meeting of the General Body of the Apex Council which is
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