The Delhi High Court dismissed the plea questioning the Authority of NCLAT Technical Member cancelling Company’s License for deliberately concealing crucial facts.
The petitioner, India Awake for Transparency has sought the issuance of a writ of quo warranto directing Respondent to set out the Authority under which the said Respondent is holding office as Technical Member of National Company Law Appellate Tribunal (NCLAT).
The Petitioner submitted that the appointment of Respondent is in the teeth of the amended provision of Section 411(3) of the Companies Act, 2013. The original provisions of Section 411(3) of the Act provided for qualification for appointment of Technical Members of NCLAT which included a person of proven ability, integrity and standing having special knowledge and experience of not less than 25 years, in law, Industrial Finance, Industrial Management, etc. Challenge was laid to various provisions of the Act including in respect of qualification of Technical Members of NCLAT under Section 411(3) as well as the composition of Selection Committees, which was allowed by the Supreme Court in the case of Madras Bar Association vs. Union of India and provisions of Section 411(3) were specifically struck down. NCLT and NCLAT were brought into existence vide Notification dated 01.06.2016 and after the Company Law Board was wound up, most of the cases pending in the High Courts were transferred to NCLT with the provision of appeal before NCLAT.
The division bench headed by the Chief Justice D.N.Patel and Justice Jyoti Singh the order passed by Regional Director (Southern Region), Ministry of Corporate Affairs, on 17.08.2018 clearly reveals that the license of the Petitioner Company as a Section 8 Company has been canceled and the Petitioner is legally debarred from using the name ‘India Awake for Transparency’, by which name the present petition has been filed.
“We also find that the Ministry of Corporate Affairs’ portal shows the status of the Petitioner Company as ‘inactive’. Apparently, investigations by the SFIO are also underway as stated in the said application,” the court added.
The court found that the Petitioner not only lacks the locus to file the present petition but has also deliberately concealed and suppressed the crucial facts, which have been brought to our knowledge by Respondent and the intervener.
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