A family settlement lacks enforceability against a company unless formalized in the company's articles, and disputes regarding company management fall under NCLT jurisdiction.

JUDGMENT

1. The plaintiff has instituted this suit pleading, that (i) the plaintiff is one of the maternal great grandson of Late Sir Sobha Singh who had set up and incorporated defendant no.1 Sir Sobha Singh & Sons Pvt. Ltd.; the defendant no.1 company was incorporated as far back as on 23rd July, 1945 as a Non-Government Company for the benefit of the family members of Sir Sobha Singh and the same is a family owned company which is inter alia engaged in real estate activities with own or leased property which includes buying, selling, renting and operating of self-owned or leased real estate such as apartment buildings and dwellings, non-residential buildings etc.; (ii) all the shareholders of the defendant no.1 company are family members; (iii) Sujan Singh Park is made up of 84 flats, arranged in seven blocks viz. `A' to `G'; (iv) this residential complex was built by Sir Sobha Singh in the year 1945; (v) Sir Sobha Singh divided all his properties among his five children during his lifetime; (vi) Sujan Singh Park was meant to be shared as family space, in which each of his four sons and one daughter and their children receives a flat; (vii) however in 1947 several non-family members were given accommodation on rent in Sujan Singh Park; (viii) since the family members of Sir Sobha Singh held shares in defendant no.1 company, in order to extend benefit to the shareholders of the defendant no.1 company, it was decided that the flats of defendant no.1 company at Sujan Singh Park be allotted to family members and shareholders of defendant no.1 company in lieu of shares held by them in defendant no.1 company; (ix) as the family expanded, allocation of flats became an issue and which was settled by arriving at an understanding among the family members/descendants that all the properties will be allotted to the family members/descendants up to the fourth generation; (x) a Board Resolution dated 21st July, 1990 recording the aforesaid agreement was passed, which named all descendants of Sir Sobha Singh upto the fourth generation, wherein each member of the family, whether boy or girl were entitled to a flat; (xi) accordingly a family tree was built in order to decide the entitlement; (xii) thereafter whenever a flat fell vacant, the topmost on the waiting list was allotted a flat; this system prevented family squabbles; (xiii) all the shares of defendant no.1 company are held by family members and all the directors in the defendant no.1 company are family members only; (xiv) after the demise of Gurbux Singh son of Sir Sobha Singh, Preminder Singh, grandson of Sir Sobha Singh took charge as head of defendant no.1 company and has been looking after allocation, maintenance and presiding over Annual General Meeting (AGM) of shareholders of defendant no.1 company; (xv) the family tree for allotment of flats included 23 members of Sir Sobha Singh's family; (xvi) out of the said 23 members, all the grandchildren of Mrs. Mohinder Jaspal Singh, one of the daughters of Sir Sobha Singh, were allotted flats leaving only the plaintiff; (xvii) the plaintiff in the list aforesaid is positioned at serial no. 18 and is next in line for allotment of the flat, as the flats were in occupation of tenants and as and when the flats were vacated/tenants evicted, eligible persons from the list were allotted the same; this practice is being followed since the Resolution dated 21st July, 1990; (xviii) one of the flats bearing no. B-15, Sujan Singh park, New Delhi was vacated in early 2014; the plaintiff vide his e-mail dated 25th March, 2014 requested defendant no.1 company to allot the said vacant flat to the plaintiff; (xix) how