H.R. Sharma v. Delhi and District Cricket Association & Ors.

Delhi High Court · 23 Nov 2023 · 2023:DHC:8450
Vikas Mahajan
W.P.(C) 17415/2022
2023:DHC:8450
administrative petition_dismissed Significant

AI Summary

The Delhi High Court dismissed the writ petition challenging the DDCA Ombudsman's order and AGM agenda, holding that the petitioner must seek redressal before the NCLT under the Companies Act, 2013, as writ jurisdiction is not available when alternate efficacious remedies exist.

Full Text
Translation output
W.P.(C) 17415/2022
HIGH COURT OF DELHI
W.P.(C) 17415/2022
H.R. SHARMA DELHI AND DISTRICT CRICKET ASSOCIATION & ORS.
CORAM:
HON'BLE MR. JUSTICE VIKAS MAHAJAN VIKAS MAHAJAN
CM APPL. 8079/2023 facts on record)
DRAFT RFA 832/2016 13.05.
HIGH COURT OF DELHI
Pronounced 17415/2022 & CM APPLNs. 55448-49/2022
H.R. SHARMA
Through: Mr. P. Chidambaram Ankur Chawla, Mr. Gautam Dutta, Ms. Prerna Mahajan and Mr. Aditya Samaddar, Advs.
VERSUS
DELHI AND DISTRICT CRICKET ASSOCIATION & ORS. ..... Respondent
Through: Mr. Sandeep Sethi, Mr. Raji Adv., Mr. Rajshekhar Rao, Sr. Advs. with Mr. Manik Dogra, Mr. T.
Singhdev, Mr. Saurabh Chadha, Mr. Bhanu Gulati, Ms. Ramanpreet Kaur, Mr. Abhijit Chakrvarty, Mr. AabhaasSukhramani, Ms. Anum Hossain, Mr. Tanishq Srivastava, Mr. Rohit Bhagat and Ms. Tanvi, Advs. for
R-1/DDCA.
Mr. Sacchin Puri, Sr. Adv. with Mr. Praveen Kumar, Ms. Nidhi Rana and
Mr. Sahil Nagpal, Advs. for R Mr. Kirtiman Singh, CGSC with Ms
Vidhi Jain and Mr Madhav Bajaj, Advocates for R-14 to R
HON'BLE MR. JUSTICE VIKAS MAHAJAN
JUDGMENT
VIKAS MAHAJAN, J.
CM APPL. 8079/2023 (under Section 151 CPC seeking to place additional
DRAFT RFA 832/2016 13.05. 202 3
HIGH COURT OF DELHI
Pronounced on:23.11.2023 49/2022 .....Petitioner
Chidambaram, Sr. Adv., Mr. Ankur Chawla, Mr. Gautam Dutta, Ms. Prerna Mahajan and Mr. Aditya DELHI AND DISTRICT CRICKET ASSOCIATION & ORS. ..... Respondent
Mr. Rajiv Nayar, Sr.
Rajshekhar Rao, Sr. Advs. with Mr. Manik Dogra, Mr. T.
Singhdev, Mr. Saurabh Chadha, Mr. Bhanu Gulati, Ms. Ramanpreet Kaur, Mr. Abhijit Chakrvarty, Mr. AabhaasSukhramani, Ms. Anum Hossain, Mr. Tanishq Srivastava, Mr. Rohit Bhagat and Ms. Tanvi, Advs. for
Mr. Sacchin Puri, Sr. Adv. with Mr. Praveen Kumar, Ms. Nidhi Rana and
Mr. Sahil Nagpal, Advs. for R-3.
Singh, CGSC with Ms Vidhi Jain and Mr Madhav Bajaj, 14 to R-16.
(under Section 151 CPC seeking to place additional
W.P.(C) 17415/2022

1. As notice has stands allowed. W.P.(C) 17415/2022

2. The petitioner District Cricket Association (herein no. 1”) has filed the present writ petition seeking the following reliefs:

“A. Issue a writ of Certiorari or any other appropriate writ order or direction quashing and setting aside the order dated 21.11.2022 of the Ld. Ombudsman;
B. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby declaring that the tenure of the Ld. Ombudsman is a fixed tenure of 1 yea appointment in terms of Article 41 of the Articles of Association and also in terms of the judgment of of India reported in Cricket Association of Bihar" cannot be extended;
C. Issue a writ of Certiorari or any other appropriate writ order or direction setting aside Agenda No.4 and 5 of the Notice dated 04.12.2022 issued in respect of holding of meeting of the General Body of DDCA proposed to be 27.12.2022;
D. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing and declaring that DDCA is bound to hold elections for retiring Directors in terms of Article 17(3) read with Article 10(2) of Articles of on or before 30.09.2022 every year so as to ensure that fixed term of 1 year of any Director is not extended either directly or indirectly and also does not allow the directors to extend their term beyond three years from the date of their firs
E. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing inclusion of an Agenda for DRAFT RFA 832/2016 13.05. notice has not been issued in the present writ petition, the application W.P.(C) 17415/2022 The petitioner being a life member of the Sports Body of the Delhi & ict Cricket Association (hereinafter referred to as “DDCA present writ petition seeking the following reliefs:
A. Issue a writ of Certiorari or any other appropriate writ order or direction quashing and setting aside the order dated 21.11.2022 of the Ld. Ombudsman;
B. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby declaring that the tenure of the Ld. Ombudsman is a fixed tenure of 1 year from the date of appointment in terms of Article 41 of the Articles of Association and also in terms of the judgment of the Hon'ble Supreme Court of India reported in (2016)8 SCC 535 entitled, "BCCI Vs. Cricket Association of Bihar" and further that the said term cannot be extended;
C. Issue a writ of Certiorari or any other appropriate writ order or direction setting aside Agenda No.4 and 5 of the Notice dated 04.12.2022 issued in respect of holding of meeting of the General Body of DDCA proposed to be
D. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing and declaring that DDCA is bound to hold elections for retiring Directors in terms of Article 17(3) read with Article 10(2) of Articles of Association on or before 30.09.2022 every year so as to ensure that fixed term of 1 year of any Director is not extended either directly or indirectly and also does not allow the directors to extend their term beyond three years from the date of their first election;
E. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing inclusion of an Agenda for DRAFT RFA 832/2016 13.05. 202 3 been issued in the present writ petition, the application member of the Sports Body of the Delhi & after referred to as “DDCA” or “respondent present writ petition seeking the following reliefs:
A. Issue a writ of Certiorari or any other appropriate writ order or direction quashing and setting aside the order dated
B. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby declaring that the tenure of the Ld. r from the date of appointment in terms of Article 41 of the Articles of Association the Hon'ble Supreme Court "BCCI Vs. said term
C. Issue a writ of Certiorari or any other appropriate writ order or direction setting aside Agenda No.4 and 5 of the Notice dated 04.12.2022 issued in respect of holding of meeting of the General Body of DDCA proposed to be held on
D. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing and declaring that DDCA is bound to hold elections for retiring Directors in terms of Association on or before 30.09.2022 every year so as to ensure that fixed term of 1 year of any Director is not extended either directly or indirectly and also does not allow the directors to extend their t election;
E. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing inclusion of an Agenda for W.P.(C) 17415/2022 holding elections through secret ballot in respect of the retiring Directors in terms of Article 17 of Articles of Assoc also for appointing an Election Officer and an Observer in respect of the said election, which election Officer may either be a retired judge of Hon'ble Supreme Court or a former Chief Justice of this Hon'ble Court or a former Election Commissioner of India;
F. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing and declaring that Government nominees have retired with effect from 31.08.2022 in terms of their letter dated 01.09.2020;
G. Issue a writ of Ma order or direction, thereby directing the DDCA to appoint a CEO and CFO in terms of the judgment of the Hon'ble Supreme Court.”

3. The facts as pleaded by the petitioner incorporated under the Companies Act office bearers. The DDCA Cricket in India (BCCI) and has the exclusive authority to run the game of Cricket in the territory of NCT of Delhi. bearers of the DDCA 29.10.2024. The respondents no. 7 to 13 are ordinary directors of the

4. It is pleaded by the petitioner that i 1/3rd of the ordinary directors General Meeting through the same date i.e. 29.10.2021 “(3) One third of all Directors, except the office bearers, nominee of the Chief Controller o DRAFT RFA 832/2016 13.05. holding elections through secret ballot in respect of the retiring Directors in terms of Article 17 of Articles of Association and also for appointing an Election Officer and an Observer in respect of the said election, which election Officer may either be a retired judge of Hon'ble Supreme Court or a former Chief Justice of this Hon'ble Court or a former Election ner of India;

F. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing and declaring that Government nominees have retired with effect from 31.08.2022 in terms of their letter dated 01.09.2020;
G. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing the DDCA to appoint a CEO and CFO in terms of the judgment of the Hon'ble Supreme as pleaded by the petitioner are that the DDCA incorporated under the Companies Act, 1956 and respondent DDCA is an affiliate state unit of the Board for Control for Cricket in India (BCCI) and has the exclusive authority to run the game of Cricket in the territory of NCT of Delhi. Respondent nos. 2-6 are the five office DDCA and have a fixed term of three years which expires on espondents no. 7 to 13 are ordinary directors of the t is pleaded by the petitioner that in terms of Article 17(3) of the AoA, of the ordinary directors shall retire by rotation each year at ev through a draw of lots as all the directors were appointed on the same date i.e. 29.10.2021. Article 17(3) of the AoA reads as under: (3) One third of all Directors, except the office bearers, nominee of the Chief Controller of Accounts of the Government DRAFT RFA 832/2016 13.05. 202 3 holding elections through secret ballot in respect of the retiring iation and also for appointing an Election Officer and an Observer in respect of the said election, which election Officer may either be a retired judge of Hon'ble Supreme Court or a former Chief Justice of this Hon'ble Court or a former Election
F. Issue a writ of Mandamus or any other appropriate writ order or direction, thereby directing and declaring that Government nominees have retired with effect from 31.08.2022 ndamus or any other appropriate writ order or direction, thereby directing the DDCA to appoint a CEO and CFO in terms of the judgment of the Hon'ble Supreme DDCA is a company, 1956 and respondent nos. 2-18 are its is an affiliate state unit of the Board for Control for Cricket in India (BCCI) and has the exclusive authority to run the game of 6 are the five office three years which expires on espondents no. 7 to 13 are ordinary directors of the DDCA. n terms of Article 17(3) of the AoA, shall retire by rotation each year at every Annual draw of lots as all the directors were appointed on. Article 17(3) of the AoA reads as under:- (3) One third of all Directors, except the office bearers, f Accounts of the Government W.P.(C) 17415/2022 of National Capital Territory of Delhi and three nominees of the Government of India, shall retire by rotation at every Annual General Meeting. The Directors to retire by rotation at every Annual General Meeting shall be those longest in office since their last appointment, but as between persons who became directors on the same day, those who are to retire shall, in default of and subject to any agreement among themselves, be determined by lot. At the Annual Gener Meeting at which a Director retires as aforesaid, the company may fill up the vacancy by appointing the retiring director if he is eligible for such appointment as per these Articles or some other person thereto

5. Respondent no departments of the Centra Central Government for the construction of Feroz renamed as Shri Arun Jaitely to appoint its nominees from Sports and Sports Authority of I respondent no. 1, who have full voting rights.

6. In order to seek a declaration (seven) elected directors shall Articles of Association (AoA) 27.06.2022 before the Ld. Ombudsman prayers made in the sa “(A) Pass an order, declaring and directing that 4 Directors/Councillors out of 7 Elected Directors/ Councillors currently in the Apex Council of the DDCA who were elected on 28th Oct 2021 shall necessarily retire by rotation through a draw of lotto be conducted by the Hon'ble Ombudsman and the resultantvacancy shall be filled in the ensuing AGM to be held latestbefore 30 Septemb DRAFT RFA 832/2016 13.05. of National Capital Territory of Delhi and three nominees of the Government of India, shall retire by rotation at every Annual General Meeting. The Directors to retire by rotation at every Annual General Meeting shall be those who have been longest in office since their last appointment, but as between persons who became directors on the same day, those who are to retire shall, in default of and subject to any agreement among themselves, be determined by lot. At the Annual Gener Meeting at which a Director retires as aforesaid, the company may fill up the vacancy by appointing the retiring director if he is eligible for such appointment as per these Articles or some other person thereto ” espondent nos. 14 to respondent No. 16 are nominees from various departments of the Central Government as the DDCA was allotted land by the Central Government for the construction of Feroz Shah Kotla Stadium (now renamed as Shri Arun Jaitely Stadium). The Central Government has the power nominees from the Ministry of Housing Affairs, Ministry of Sports and Sports Authority of India to the Board of Directors respondent no. 1, who have full voting rights. n order to seek a declaration to the effect that 4 Directors out o elected directors shall retire by rotation in terms of Article 17(3) of the Articles of Association (AoA), the petitioner had filed a complaint dated 27.06.2022 before the Ld. Ombudsman-cum-Ethics officer of the said complaint read as under: (A) Pass an order, declaring and directing that 4 Directors/Councillors out of 7 Elected Directors/ Councillors the Apex Council of the DDCA who were elected on 28th Oct 2021 shall necessarily retire by rotation through a draw of lotto be conducted by the Hon'ble Ombudsman and the resultantvacancy shall be filled in the ensuing AGM to be held latestbefore 30 September 2022; And DRAFT RFA 832/2016 13.05. 202 3 of National Capital Territory of Delhi and three nominees of the Government of India, shall retire by rotation at every Annual General Meeting. The Directors to retire by rotation at who have been longest in office since their last appointment, but as between persons who became directors on the same day, those who are to retire shall, in default of and subject to any agreement among themselves, be determined by lot. At the Annual General Meeting at which a Director retires as aforesaid, the company may fill up the vacancy by appointing the retiring director if he is eligible for such appointment as per these Articles or some 16 are nominees from various was allotted land by the Kotla Stadium (now Central Government has the power Ministry of Housing Affairs, Ministry of ndia to the Board of Directors of the

4 Directors out of 7 in terms of Article 17(3) of the, the petitioner had filed a complaint dated Ethics officer of the DDCA. The (A) Pass an order, declaring and directing that 4 Directors/Councillors out of 7 Elected Directors/ Councillors the Apex Council of the DDCA who were elected on 28th Oct 2021 shall necessarily retire by rotation through a draw of lotto be conducted by the Hon'ble Ombudsman and the resultantvacancy shall be filled in the ensuing AGM to be held W.P.(C) 17415/2022 (B) Pass an order, direction specifically directing the Respondent (DDCA) to carry out urgent and time bound exercise to weed out the dead and defaulting members from the "Statutory Register of Members of the Company" latest before 15th August 2022 by publishing Notice in two National Newspapers of repute and thereafter file compliance report with the Hon'ble Ombudsman and permanently upload the latest verified list of members on the official Website of DDCA.”

7. The grievance of the petitioner is that vide order dated 21.11.2022 passed in another complaint titled as Ld. Ombudsman-cum complaint pending before it, because of of time. The petitioner apprehends that the fate of his petition and an identical order the impugned order dated 21.11.2022 Bhardwaj (supra) reads as under: “29. For the above reasons, I am of the view that the term of the Ombudsman cum Ethics Officer ought to continue till the conclusion of the next Annual General Meeting, which must be held within 3 (three) months dated 12.09.2022 passed by the Office of Registrar of Companies, Ministry of Corporate Affairs, Government of India under Section 96(1) of the Companies Act, 2013. The General Body at the Annual General Meeting, will deal w of fresh appointment / re Ethics Officer.

30. Accordingly, the preliminary objection raised by the Complainant is rejected., However, in order to preserve the sanctity of the office of the Ombudsman cum Ethi proceedings will be taken up by the incumbent Ombudsman, till DRAFT RFA 832/2016 13.05. (B) Pass an order, direction specifically directing the Respondent (DDCA) to carry out urgent and time bound exercise to weed out the dead and defaulting members from the "Statutory Register of Members of the Company" latest before t 2022 by publishing Notice in two National Newspapers of repute and thereafter file compliance report with the Hon'ble Ombudsman and permanently upload the latest verified list of members on the official Website of The grievance of the petitioner is that vide order dated 21.11.2022 passed in another complaint titled as Sanjay Bhardwaj v. Shashi Khanna cum-Ethics officer has decided not to complaint pending before it, because of the expiry of her tenure due to efflux of time. The petitioner apprehends that the fate of his petition and an identical order will be passed in his case also. The operative portion of the impugned order dated 21.11.2022 passed in the complaint reads as under:

29. For the above reasons, I am of the view that the term of the Ombudsman cum Ethics Officer ought to continue till the conclusion of the next Annual General Meeting, which must be held within 3 (three) months from 30.09.2021 as per the Order dated 12.09.2022 passed by the Office of Registrar of Companies, Ministry of Corporate Affairs, Government of India under Section 96(1) of the Companies Act, 2013. The General Body at the Annual General Meeting, will deal with the Agenda of fresh appointment / re-appointment of the Ombudsman cum Ethics Officer.

30. Accordingly, the preliminary objection raised by the Complainant is rejected., However, in order to preserve the sanctity of the office of the Ombudsman cum Ethics Officer, no proceedings will be taken up by the incumbent Ombudsman, till DRAFT RFA 832/2016 13.05. 202 3 (B) Pass an order, direction specifically directing the Respondent (DDCA) to carry out urgent and time bound exercise to weed out the dead and defaulting members from the "Statutory Register of Members of the Company" latest before t 2022 by publishing Notice in two National Newspapers of repute and thereafter file compliance report with the Hon'ble Ombudsman and permanently upload the latest verified list of members on the official Website of The grievance of the petitioner is that vide order dated 21.11.2022 Sanjay Bhardwaj v. Shashi Khanna, the to adjudicate any xpiry of her tenure due to efflux of time. The petitioner apprehends that the fate of his petition will be similar. The operative portion of passed in the complaint of Sanjay

29. For the above reasons, I am of the view that the term of the Ombudsman cum Ethics Officer ought to continue till the conclusion of the next Annual General Meeting, which must be from 30.09.2021 as per the Order dated 12.09.2022 passed by the Office of Registrar of Companies, Ministry of Corporate Affairs, Government of India under Section 96(1) of the Companies Act, 2013. The General ith the Agenda appointment of the Ombudsman cum

30. Accordingly, the preliminary objection raised by the Complainant is rejected., However, in order to preserve the cs Officer, no proceedings will be taken up by the incumbent Ombudsman, till W.P.(C) 17415/2022 a decision is taken by the Annual General Meeting in the next meeting. It may also be noted that the incumbent Ombudsman Ethics Officer will not take any remuneration for the extended period till a decision is taken regarding the appointment of the Ombudsman at the next Annual General Meeting.”

116,613 characters total

8. The petitioner by the DDCA/respondent no. 1 was scheduled to be held on 27.12.2022. counsel for the petitioner, agenda no. 4 & 5 of the "Agenda - 4 To take note of the directors retiring by rotation and to fill up the Vacancy by appointing the retiring directors being eligible for such appointment as per the Articles of Association of the Company To consider and if thought fit to pass with or without modification(s) the following resolution as an Ordinary Resolution: 4(a) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, Mr. Ashok Sharma, the Director retiring by rotation be and is hereby reappointed as the Me the Company)". 4(b) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, Mr. Harish Singla, the Director retiring by rotation be and is hereby reappointed as the Member of DRAFT RFA 832/2016 13.05. a decision is taken by the Annual General Meeting in the next It may also be noted that the incumbent Ombudsman Ethics Officer will not take any remuneration for the aforesaid extended period till a decision is taken regarding the appointment of the Ombudsman at the next Annual General The petitioner also impugns Notice & Agenda dated 04.12.2022 espondent no. 1 calling for an Annual General Meeting which was scheduled to be held on 27.12.2022. As clarified by the learned senior counsel for the petitioner, the grievance of the petitioner is of the said notice, which read as under: note of the directors retiring by rotation and to fill up the Vacancy by appointing the retiring directors being eligible for such appointment as per the Articles of Association of the To consider and if thought fit to pass with or without ation(s) the following resolution as an Ordinary 4(a) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, Mr. Ashok Sharma, the Director retiring by rotation be and is hereby reappointed as the Member of the Apex Council (Director of the Company)". 4(b) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, Mr. Harish Singla, the Director retiring by rotation be and is hereby reappointed as the Member of the Apex Council (Director of the Company)."

DRAFT RFA 832/2016 13.05. 202 3 a decision is taken by the Annual General Meeting in the next It may also be noted that the incumbent Ombudsman-cumaforesaid extended period till a decision is taken regarding the appointment of the Ombudsman at the next Annual General Notice & Agenda dated 04.12.2022 issued ral Meeting which the learned senior the petitioner is confined only to note of the directors retiring by rotation and to fill up the Vacancy by appointing the retiring directors being eligible for such appointment as per the Articles of Association of the To consider and if thought fit to pass with or without ation(s) the following resolution as an Ordinary 4(a) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, Mr. Ashok Sharma, the mber of the Apex Council (Director of 4(b) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, Mr. Harish Singla, the Director retiring by rotation be and is hereby reappointed as the Apex Council (Director of the Company)." W.P.(C) 17415/2022 4(c) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, the Director retiring by rotation be and is hereby reappointed as the Member of the Apex Council (Directo Agenda-5 (to be considered if Agenda No. 4(a), 4(b) or 4(c) is not carried through To hold the elections to the vacant post of directors. To consider and modification(s) the following resolution Resolution: "Resolved that pursuant to provisions of Article 17 read with Article 34 of the Articles of Association of the Company, Electoral Officer appointed by the Chairperson is requested to hold the elections to the Vacant post of Dir 27TH January 2023."

9. According to the petitioner, the afore commissions were causing prejudice to him. was pending consideration on General Meeting was held on 27.12.2022. respect of the conduct of the vide CM Appl. No. 8079/2023 dated 16.02.2023 opening part of this judgment

10. In the meanwhile dated 22.02.2023 adjourned the complaint of the petitioner ground that the present writ petition is pending. The relevant part of the o dated 22.02.2023 reads as under: “In view of the statement made by the Counsel for the Complainant that there are some overlapping issues in the Writ Petition. And to avoid parallel proceedings, it is DRAFT RFA 832/2016 13.05. 4(c) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, the Director retiring by rotation be and is hereby reappointed as the Member of the Apex Council (Director of the Company)." 5 (to be considered if Agenda No. 4(a), 4(b) or 4(c) is not carried through To hold the elections to the vacant post of directors. To consider and if thought fit to pass with or without modification(s) the following resolution as an Ordinary "Resolved that pursuant to provisions of Article 17 read with Article 34 of the Articles of Association of the Company, Electoral Officer appointed by the Chairperson is requested to hold the elections to the Vacant post of Directors on or before 27TH January 2023."" According to the petitioner, the afore-noted acts of omission causing prejudice to him. However, when the writ petition was pending consideration on the question of its entertainability was held on 27.12.2022. The grievances of the petitioner in respect of the conduct of the Annual General Meeting were CM Appl. No. 8079/2023 dated 16.02.2023 which has been opening part of this judgment. In the meanwhile, the Ld. Ombudsman-cum-Ethics officer adjourned the complaint of the petitioner the present writ petition is pending. The relevant part of the o dated 22.02.2023 reads as under:- In view of the statement made by the Counsel for the Complainant that there are some overlapping issues in the Writ Petition. And to avoid parallel proceedings, it is DRAFT RFA 832/2016 13.05. 202 3 4(c) "Resolved that pursuant to provisions of Article 17 of the Articles of Association of the Company, the Director retiring by rotation be and is hereby reappointed as the Member of the 5 (to be considered if Agenda No. 4(a), 4(b) or 4(c) is thought fit to pass with or without Ordinary "Resolved that pursuant to provisions of Article 17 read with Article 34 of the Articles of Association of the Company, Electoral Officer appointed by the Chairperson is requested to ectors on or before acts of omission and hen the writ petition entertainability, the Annual grievances of the petitioner in were brought on record which has been allowed in the Ethics officer vide order adjourned the complaint of the petitioner sine die on the the present writ petition is pending. The relevant part of the order In view of the statement made by the Counsel for the Complainant that there are some overlapping issues in the Writ Petition. And to avoid parallel proceedings, it is W.P.(C) 17415/2022 deemed appropriate that the present complaint is adjourned sine die, subject to the orders passed by the Hon’ble Delhi High Court SUBMISSIONS ON BEHALF OF THE PETITIONER

11. Arguments were addressed by the parties confined to the preliminary objection with respect by the respondents at the outset.

12. Mr. P. Chidambaram, learned senior counsel for the petitioner submit that a writ petition under Article 226 of the Constitution of India will lie before this Court, in as much as pray reproduced above for ready reference, petitioner has challenged the order of the learned Ombudsman Officer and no tribunal has the power to set aside the ord Ombudsman-cum-Ethics Officer.

13. He submits that under the Articles of Association of the respondent no.1, the decision of the learned Ombudsman binding and since no appeal mechanism has been provided under the Ar of Association, the remedy of the petitioner against the impugned before this Court by way of a writ petition under Article 226 of the Constitution of India. Article 42(3) of the as under: "42.

GRIEVANCE REDRESSAL

3) The decision of the Ombudsman shall be final and binding and shall come into force forthwith on being pronounced and delivered DRAFT RFA 832/2016 13.05. deemed appropriate that the present complaint is adjourned sine die, subject to the orders passed by the Hon’ble Delhi High Court”

SUBMISSIONS ON BEHALF OF THE PETITIONER rguments were addressed by the parties confined to the preliminary with respect to the entertainability of the present writ petition by the respondents at the outset. Chidambaram, learned senior counsel for the petitioner submit under Article 226 of the Constitution of India will lie before this Court, in as much as prayers A & B of the Writ petition for ready reference, can only be granted by this Court as the petitioner has challenged the order of the learned Ombudsman Officer and no tribunal has the power to set aside the ord Ethics Officer. He submits that under the Articles of Association of the respondent no.1, the decision of the learned Ombudsman-cum-Ethics Officer is final and binding and since no appeal mechanism has been provided under the Ar of Association, the remedy of the petitioner against the impugned before this Court by way of a writ petition under Article 226 of the Constitution of India. To buttress his contention, Mr. Chidambaram Article 42(3) of the Articles of Association (AoA) of the DDCA "42.

GRIEVANCE REDRESSAL

3) The decision of the Ombudsman shall be final and binding and shall come into force forthwith on being pronounced and delivered"

DRAFT RFA 832/2016 13.05. 202 3 deemed appropriate that the present complaint is adjourned sine die, subject to the orders passed by the rguments were addressed by the parties confined to the preliminary of the present writ petition, raised Chidambaram, learned senior counsel for the petitioner submits under Article 226 of the Constitution of India will lie before ers A & B of the Writ petition, which has been can only be granted by this Court as the petitioner has challenged the order of the learned Ombudsman-cum-Ethics Officer and no tribunal has the power to set aside the order of learned He submits that under the Articles of Association of the respondent no.1, Ethics Officer is final and binding and since no appeal mechanism has been provided under the Articles of Association, the remedy of the petitioner against the impugned order lies before this Court by way of a writ petition under Article 226 of the To buttress his contention, Mr. Chidambaram referred to DDCA, which reads

3) The decision of the Ombudsman shall be final and binding and shall come into force forthwith on being W.P.(C) 17415/2022

14. Referring to Section 241 of the Chidambaram submits the NCLT in case the affairs of the company are being conducted in a manner which is prejudicial to the public interest or members or to the interests of the company. He, however, right to approach the tribunal is not absolute and has been qualified under Section 244(1)(b) of the Act NCLT unless the petition is supported by of members of the respondent no.1/DDCA.

15. Further, referring to Section 430 of the Companies Act, Chidambaram submits that Court to entertain a suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under the Companies Act, 2013 Court while exercising its extra Constitution of India.

16. Mr. Chidambaram, cum-Ethics Officer was created on the basis of the recommendations of the ‘Lodha Committee’ which came to be accepted by of Control for Cricket v. Cricket Association of Bihar and Ors.

535. He submits that the learned Ombudsman tasked with providing institutiona between the DDCA the learned senior co ombudsman has suo moto DRAFT RFA 832/2016 13.05. to Section 241 of the Companies Act, 2013 submits that a member of a company can file a in case the affairs of the company are being conducted in a manner prejudicial to the public interest or to him or to any other member or members or to the interests of the company. He, however, right to approach the tribunal is not absolute and has been qualified under of the Act, inasmuch as, the petitioner cannot approach the ess the petition is supported by not less than 1/5th of the total number members of the respondent no.1/DDCA. eferring to Section 430 of the Companies Act, submits that the said Section bars the jurisdiction of the Civil Court to entertain a suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under the Companies Act, 2013, but this Court would not fall within the ambit ourt while exercising its extraordinary jurisdiction under Article 226 of the Constitution of India. Mr. Chidambaram, submits that the office of the learned Ombudsman Ethics Officer was created on the basis of the recommendations of the which came to be accepted by the Supreme Court in of Control for Cricket v. Cricket Association of Bihar and Ors. that the learned Ombudsman-cum-Ethics Officer has been tasked with providing institutional resolution to resolve dispute and its members. Referring to Article 42(1) of the AoA, the learned senior counsel for the petitioner submits suo moto powers to adjudicate disputes including DRAFT RFA 832/2016 13.05. 202 3 Companies Act, 2013, Mr. member of a company can file a complaint before in case the affairs of the company are being conducted in a manner any other member or members or to the interests of the company. He, however, adds that such a right to approach the tribunal is not absolute and has been qualified under the petitioner cannot approach the of the total number eferring to Section 430 of the Companies Act, Mr. bars the jurisdiction of the Civil Court to entertain a suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under the this Court would not fall within the ambit of a Civil ordinary jurisdiction under Article 226 of the the office of the learned Ombudsman- Ethics Officer was created on the basis of the recommendations of the the Supreme Court in Board of Control for Cricket v. Cricket Association of Bihar and Ors., (2016) 8 SCC Ethics Officer has been l resolution to resolve disputes/differences Referring to Article 42(1) of the AoA, that the learned powers to adjudicate disputes including (a) member W.P.(C) 17415/2022 and association disputes misconduct or breach by others, (d) by the p

17. Mr. Chidambaram, submits that the learned Ombudsman Officer was appointed on 25.10.2021 the learned Ombudsman submits that the petitioner had filed his complaint before the learned Ombudsman-cum-Ethics Officer on 27.06.2022 and orders were reserved on 13.09.2022, much before the cum-Ethics Officer Ombudsman-cum-Ethics petitioner.

18. He submits ombudsman has allowed the grave prejudice to the petitioner as well as the public at large. to paragraph 37(b) of the decision of the Supreme Court in for Cricket (Supra), the learned Ombudsman within 30 (thirty) days from the receipt of the complaint, whereas, in the present case, the complaint of the petitioner remained unresolved for a period of 4 months.

19. Mr. Chidambaram also made submissions im taken in the Annual General Meeting held on 27.12.2022, but at this stage those submissions need not be referred to, as this Court for now is itself only to the preliminary objection entertainability of the present petition.

DRAFT RFA 832/2016 13.05. isputes, (b) detriment caused by member or a misconduct or breach by others, (d) by the public against the DDCA. Mr. Chidambaram, submits that the learned Ombudsman Officer was appointed on 25.10.2021 for a term of one year and the tenure of learned Ombudsman-cum-Ethics Officer had expired on submits that the petitioner had filed his complaint before the learned Ethics Officer on 27.06.2022 and orders were reserved on before the expiry of the term of the learned Ombudsman Ethics Officer, therefore, there was ample time for the learned Ethics Officer to pass an order on the complaint of the that the hands-off approach adopted by the learned ombudsman has allowed the respondent no. 1 to act in a manner which causes ejudice to the petitioner as well as the public at large. to paragraph 37(b) of the decision of the Supreme Court in for Cricket (Supra), the learned senior counsel for the petitioner submits that the learned Ombudsman-cum-Ethics Officer is bound to resolve complaints within 30 (thirty) days from the receipt of the complaint, whereas, in the present case, the complaint of the petitioner remained unresolved for a period Mr. Chidambaram also made submissions impugning various decisions taken in the Annual General Meeting held on 27.12.2022, but at this stage those submissions need not be referred to, as this Court for now is itself only to the preliminary objection raised by the respondents of the present petition.

DRAFT RFA 832/2016 13.05. 202 3 d by member or administrator, (c) ublic against the DDCA. Mr. Chidambaram, submits that the learned Ombudsman-cum-Ethics for a term of one year and the tenure of had expired on 24.10.2022. He submits that the petitioner had filed his complaint before the learned Ethics Officer on 27.06.2022 and orders were reserved on the term of the learned Ombudsmans ample time for the learned to pass an order on the complaint of the off approach adopted by the learned espondent no. 1 to act in a manner which causes ejudice to the petitioner as well as the public at large. Further referring Board of Control the learned senior counsel for the petitioner submits that Ethics Officer is bound to resolve complaints within 30 (thirty) days from the receipt of the complaint, whereas, in the present case, the complaint of the petitioner remained unresolved for a period pugning various decisions taken in the Annual General Meeting held on 27.12.2022, but at this stage, those submissions need not be referred to, as this Court for now is confining respondents as to the W.P.(C) 17415/2022 SUBMISSIONS ON BEHALF OF THE RESPONDENTS

20. Mr. Rajiv Nayar, learned senior counsel appearing on advance notice on behalf of the DDCA the impugned order passed petitioner is neither a party to the said proceedings nor by the order dated 21.11.2022. the impugned order has been passed in the case Shashi Khanna & Ors contends that neither the parties to the aforesaid proceedings nor the Ld. Ombudsman-cum-Ethics officer have been petition.

21. Next, Mr. Nayar referred contend that the legislature has NCLT to adjudicate any matter which fall Act, 2013 and in such a case, this Court ordinary jurisdiction under Article 226 of the Constitut

22. Inviting the attention of the Court to the prayers made in the petition, Mr. Nayar mismanagement of the respondent no.1 and has made complaints of oppression by the directors of the comp relegated to the NCLT accordance with Section

23. He further submits that the NCLT has been conferred wide powers under Section 242 of the Act and thus, this Court its jurisdiction under Article 226 of the Constitution of India. Section 242(2) of the Act, DRAFT RFA 832/2016 13.05.

SUBMISSIONS ON BEHALF OF THE RESPONDENTS Mr. Rajiv Nayar, learned senior counsel appearing on advance notice on DDCA submits that the petitioner has no locus standi the impugned order passed by the Ld. Ombudsman-cum-Ethics petitioner is neither a party to the said proceedings nor he is a party the order dated 21.11.2022. Elaborating on his argument the impugned order has been passed in the case entitled "Sanjay Bhardwaj vs. Ors." and not in the complaint filed by the petitioner. that neither the parties to the aforesaid proceedings nor the Ld. Ethics officer have been arrayed as a parties Mr. Nayar referred to Section 430 of the Companies Act, 2013 to contend that the legislature has specifically conferred jurisdiction upon the NCLT to adjudicate any matter which falls within the ambit of the Companies Act, 2013 and in such a case, this Court may refrain from exercising its extra ordinary jurisdiction under Article 226 of the Constitution. attention of the Court to the prayers made in the submits that the petitioner is in essence aggrieved by the management of the respondent no.1 and has made complaints of oppression by the directors of the company for which purpose the petitioner should be NCLT, where he may seek redressal of accordance with Sections 241 and 242 of the Companies Act, 2013. He further submits that the NCLT has been conferred wide powers Section 242 of the Act and thus, this Court may refrain from exercising its jurisdiction under Article 226 of the Constitution of India. Section 242(2) of the Act, Mr. Nayar submits that the NCLT has been DRAFT RFA 832/2016 13.05. 202 3 SUBMISSIONS ON BEHALF OF THE RESPONDENTS Mr. Rajiv Nayar, learned senior counsel appearing on advance notice on locus standi to challenge Ethics Officer as the he is a party aggrieved on his argument, he submits that Sanjay Bhardwaj vs. the complaint filed by the petitioner. He that neither the parties to the aforesaid proceedings nor the Ld. parties to the present to Section 430 of the Companies Act, 2013 to specifically conferred jurisdiction upon the within the ambit of the Companies refrain from exercising its extraattention of the Court to the prayers made in the writ submits that the petitioner is in essence aggrieved by the management of the respondent no.1 and has made complaints of oppression purpose the petitioner should be his grievances in of the Companies Act, 2013. He further submits that the NCLT has been conferred wide powers may refrain from exercising its jurisdiction under Article 226 of the Constitution of India. Referring to submits that the NCLT has been W.P.(C) 17415/2022 conferred jurisdiction by grievances articulated by the petitioner the NCLT.

24. It was further urged Article 226 of the Constitution is an extra exercised in a routine manner but only warrant. He contends seeking to espouse a private cause entertain the present petition.

25. Reliance is placed Bench of this Court titled as Kumar Aggarwal, 2020 SCC OnLine Del 1223 that the National Company Law Tribunal (NCLT) has been co special powers to re further contends that the appointment of the Ld. management of the affairs of the company and accordingly, present writ petition

26. Mr. Nayar has also repelled to approach the NCLT to seek proviso to sub-section application being filed by the petitioner, may waive off all the requirements/perquisites under Section 244, which according Chidambaram are posing NCLT.

DRAFT RFA 832/2016 13.05. conferred jurisdiction by the legislature to make an order grievances articulated by the petitioner as the same falls within the It was further urged by Mr. Nayar that the power to issue writs under of the Constitution is an extraordinary power and should not be exercised in a routine manner but only when exceptional circumstances He contends that the petitioner by way of the present petition is seeking to espouse a private cause in his favor, therefore, this Court in the present petition. eliance is placed by Mr. Nayar on a judgment passed by a of this Court titled as Delhi & District Cricket Association v. Sudhir, 2020 SCC OnLine Del 1223 to contend this Court has held National Company Law Tribunal (NCLT) has been co special powers to redress grievances relating to the affairs of a company. that the Co-ordinate Bench has also held that the is the Ld. Ombudsman would form part of the conduct and management of the affairs of the company and accordingly, may not be entertained. has also repelled petitioner’s contention that to approach the NCLT to seek redressal of his grievances. He refers to the section (1) of Section 244 to contend that the NCLT application being filed by the petitioner, may waive off all the requirements/perquisites under Section 244, which according posing as an impediment for the petitioner to approach the DRAFT RFA 832/2016 13.05. 202 3 to redress all the within the purview of that the power to issue writs under power and should not be when exceptional circumstances present petition is this Court may not on a judgment passed by a Co-ordinate Delhi & District Cricket Association v. Sudhir to contend this Court has held National Company Law Tribunal (NCLT) has been conferred with the affairs of a company. He held that the issue of rm part of the conduct and management of the affairs of the company and accordingly, he urged that the contention that he is not eligible redressal of his grievances. He refers to the to contend that the NCLT, on an application being filed by the petitioner, may waive off all the requirements/perquisites under Section 244, which according to Mr. an impediment for the petitioner to approach the W.P.(C) 17415/2022

27. Mr. Rajshekhar Rao, the learned senior counsel appearing for the respondent no. 2, has supported the submissions made by Mr. Rajiv Nayar. Additionally, he submits held that the grievance of an individual with respect to the “appointment” of the learned Ombudsman falls within the purview of the NCLT been so held, by extension, any grievance of the petitioner alleged hands-off approach which is stated to be adopted by the Ombudsman will also fall within the ambit of the NCLT.

28. Mr. Rao has also relied upon the Kumar Shivhare v. Assistant Director, Directorate of Enforcement SCC 772, to contend that when a statutory forum has been created by law for redressal of a grievance be entertained ignoring the statuto

31. Mr. Rao has further relied upon the judgment of a this Court in Shriraj Investment and Fiinance India and Anr., 2021 SCC OnLine Del 4361 efficacious remedy exists, this Court should not exercise its extraordinary jurisdiction under Article 226 of the Constitution unless there are extreme and/or extraordinary circumstances.

32. Mr. Rao further submits that does not contain any averment that there is no alternate eff available to the petitioner.

33. In rejoinder Mr. Ankur Chawla petitioner and broadly canvassed and reiterated the argum Chidambaram, learned senior counsel.

DRAFT RFA 832/2016 13.05. Mr. Rajshekhar Rao, the learned senior counsel appearing for the respondent no. 2, has supported the submissions made by Mr. Rajiv Nayar. Additionally, he submits that in Sudhir Kumar Aggarwal (supra) held that the grievance of an individual with respect to the “appointment” of Ombudsman falls within the purview of the NCLT, by extension, any grievance of the petitioner off approach which is stated to be adopted by the mbudsman will also fall within the ambit of the NCLT. Mr. Rao has also relied upon the decision of the Supreme Court in v. Assistant Director, Directorate of Enforcement to contend that when a statutory forum has been created by law for redressal of a grievance, especially in a fiscal statute, a writ petition should not be entertained ignoring the statutory dispensation. Mr. Rao has further relied upon the judgment of a Co- Shriraj Investment and Fiinance Limited and Ors. v. Union of, 2021 SCC OnLine Del 4361, to contend that if an alternate ious remedy exists, this Court should not exercise its extraordinary jurisdiction under Article 226 of the Constitution unless there are extreme and/or extraordinary circumstances. further submits that the writ petition as filed by the petitioner does not contain any averment that there is no alternate eff petitioner. In rejoinder Mr. Ankur Chawla has made submissions petitioner and broadly canvassed and reiterated the arguments made by Mr. Chidambaram, learned senior counsel.

DRAFT RFA 832/2016 13.05. 202 3 Mr. Rajshekhar Rao, the learned senior counsel appearing for the respondent no. 2, has supported the submissions made by Mr. Rajiv Nayar. (supra), it has been held that the grievance of an individual with respect to the “appointment” of Ombudsman falls within the purview of the NCLT and once it has, by extension, any grievance of the petitioner in respect of the off approach which is stated to be adopted by the learned of the Supreme Court in Raj v. Assistant Director, Directorate of Enforcement,(2010) 4 to contend that when a statutory forum has been created by law for especially in a fiscal statute, a writ petition should not -ordinate Bench of Limited and Ors. v. Union of to contend that if an alternate ious remedy exists, this Court should not exercise its extraordinary jurisdiction under Article 226 of the Constitution unless there are extreme filed by the petitioner does not contain any averment that there is no alternate efficacious remedy s on behalf of the ents made by Mr. W.P.(C) 17415/2022

34. To be noted that after the procedural anomaly an averment to the effect that the petition efficacious remedy additional affidavit dated 27.04.2023 petitioner does not have an

35. I have heard the learned senior counsel for the parties and have perused the relevant record.

36. At this stage, the Court is whether there is an available to the petitioner, in view entertaining the present Writ ANALYSIS AND FINDINGS

37. Before proceeding to answer the question at hand, to briefly recapitulate the law as laid down by the Hon'ble Supreme Court regard to the exercise of jurisdiction under Article 226 of the Constitut India especially when an alternate

38. In United Bank of India v. Satyawati Hon'ble Supreme Court held Article 226 of the Constitution are unfettered that before availing remedy under Article 226, a person must exhaust the remedies available under the relevant statute. The relevant decision reads as under:

"43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other

DRAFT RFA 832/2016 13.05. To be noted that after the procedural anomaly that the writ petition lack an averment to the effect that the petitioner does not have an alternate acious remedy was pointed out by Mr. Rao, the petitioner has filed an additional affidavit dated 27.04.2023 making a formal averment that petitioner does not have an alternate efficacious remedy. I have heard the learned senior counsel for the parties and have perused, the short question which arises for the consideration of this is whether there is an alternate and efficacious statutory remedy available to the petitioner, in view of which, this Court should refrain from the present Writ Petition.

ANALYSIS AND FINDINGS Before proceeding to answer the question at hand, profitable would it be to briefly recapitulate the law as laid down by the Hon'ble Supreme Court exercise of jurisdiction under Article 226 of the Constitut India especially when an alternate and efficacious statutory remedy exists. United Bank of India v. Satyawati Tondon, (2010) 8 SCC 110 Supreme Court held that though the powers of the High Court under Article 226 of the Constitution are unfettered still the High Court must insist that before availing remedy under Article 226, a person must exhaust the remedies available under the relevant statute. The relevant as under:- Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other DRAFT RFA 832/2016 13.05. 202 3 the writ petition lacks does not have an alternate, the petitioner has filed an making a formal averment that the I have heard the learned senior counsel for the parties and have perused for the consideration of this efficacious statutory remedy this Court should refrain from profitable would it be to briefly recapitulate the law as laid down by the Hon'ble Supreme Court in exercise of jurisdiction under Article 226 of the Constitution of remedy exists. Tondon, (2010) 8 SCC 110, the though the powers of the High Court under still the High Court must insist that before availing remedy under Article 226, a person must exhaust the remedies available under the relevant statute. The relevant part of the Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is on and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other W.P.(C) 17415/2022 financial institutions. In our view, while dealing with the petitions involving challenge to t the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive p the dues but also envisage constitution of quasi for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the a person must exhaust the remedies available under the relevant statute.

44. While expressing the aforesaid view, we are conscious that the powers conferred upon the High Court under Article 226 of the Constitution to issue to any person or including in appropriate cases, any Government, directions, orders or writs including the five prerogative writs for the enforcement of any of the rights conferred by Part III or for any other purpose are very wide and there is no express limitation on exercise of that power but, at the same time, we cannot be oblivious of the rules of self evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution."

39. Likewise, in State Bank of Travancore v. Mathew K.C., (2018) 3 SCC 85, the Supreme Court held statutory forum is created by law for redressal of grievances, a writ petition ought not to be ente cases falling within the well part of the decision DRAFT RFA 832/2016 13.05. financial institutions. In our view, while dealing with the petitions involving challenge to the action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi-judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute. While expressing the aforesaid view, we are conscious that the powers conferred upon the High Court under Article 226 of the Constitution to issue to any person or authority, including in appropriate cases, any Government, directions, orders or writs including the five prerogative writs for the enforcement of any of the rights conferred by Part III or for any other purpose are very wide and there is no express tion on exercise of that power but, at the same time, we cannot be oblivious of the rules of self-imposed restraint evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution." (emphasis supplied) State Bank of Travancore v. Mathew K.C., (2018) 3 SCC, the Supreme Court held that when a statutory remedy is available or statutory forum is created by law for redressal of grievances, a writ petition ought not to be entertained ignoring the statutory dispensation cases falling within the well-defined exceptions carved therein. The relevant part of the decision reads thus: DRAFT RFA 832/2016 13.05. 202 3 financial institutions. In our view, while dealing with the he action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as rocedure for recovery of judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that Constitution, a person must exhaust the remedies available under the While expressing the aforesaid view, we are conscious that the powers conferred upon the High Court under Article 226 authority, including in appropriate cases, any Government, directions, orders or writs including the five prerogative writs for the enforcement of any of the rights conferred by Part III or for any other purpose are very wide and there is no express tion on exercise of that power but, at the same time, we imposed restraint evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the asis supplied) State Bank of Travancore v. Mathew K.C., (2018) 3 SCC that when a statutory remedy is available or a statutory forum is created by law for redressal of grievances, a writ petition rtained ignoring the statutory dispensation, except in defined exceptions carved therein. The relevant W.P.(C) 17415/2022 “5. We have considered the submissions on behalf of the parties. Normally this Court in exercise of jurisdiction under Article 136 of the Constitution is loath to interfere with an interim order passed in a pending proceeding before the High Court, except in injustice or abuse of the process of the court. In the present case, the facts are not in dispute. The discretionary jurisdiction under Article 226 is not absolute but has to be exercised judiciously in the given law. The normal rule is that a writ petition under Article 226 of the Constitution ought not to be entertained if alternate statutory remedies are available, except in cases falling within the well-defined exceptions Agarwal [CIT as follows: (SCC p. 611, para 15) “15. Thus, while it can be said that this Court has recognised some exceptions to the rule of alternative remedy i.e. where the s accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has been passed in total violation of the principles of natural justice, the proposition laid down in case [Thansingh 1419], Titaghur Paper Mills case Co. Ltd. v. (Tax) 131] and other similar judgments that Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available to the aggrieved person or the statute under which the action contains a mechanism for redressal of grievance still holds the field. Therefore, when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory dispensation.

DRAFT RFA 832/2016 13.05. We have considered the submissions on behalf of the parties. Normally this Court in exercise of jurisdiction under Article 136 of the Constitution is loath to interfere with an interim order passed in a pending proceeding before the High Court, except in special circumstances, to prevent manifest injustice or abuse of the process of the court. In the present case, the facts are not in dispute. The discretionary jurisdiction under Article 226 is not absolute but has to be exercised judiciously in the given facts of a case and in accordance with The normal rule is that a writ petition under Article 226 of the Constitution ought not to be entertained if alternate statutory remedies are available, except in cases falling within defined exceptions as observed in CIT v. Chhabil Dass CIT v. Chhabil Dass Agarwal, (2014) 1 SCC 603], as follows: (SCC p. 611, para 15). Thus, while it can be said that this Court has recognised some exceptions to the rule of alternative remedy i.e. where the statutory authority has not acted in accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has ed in total violation of the principles of natural the proposition laid down in Thansingh Nathmal Thansingh Nathmal v. Supt. of Taxes, AIR 1964 SC Titaghur Paper Mills case [Titaghur Paper Mills State of Orissa, (1983) 2 SCC 433: 1983 SCC (Tax) 131] and other similar judgments that the High Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available to the aggrieved person or the statute under which the action complained of has been taken itself contains a mechanism for redressal of grievance still holds the field. Therefore, when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory pensation.” (emphasis supplied)

DRAFT RFA 832/2016 13.05. 202 3 We have considered the submissions on behalf of the parties. Normally this Court in exercise of jurisdiction under Article 136 of the Constitution is loath to interfere with an interim order passed in a pending proceeding before the High special circumstances, to prevent manifest injustice or abuse of the process of the court. In the present case, the facts are not in dispute. The discretionary jurisdiction under Article 226 is not absolute but has to be exercised facts of a case and in accordance with The normal rule is that a writ petition under Article 226 of the Constitution ought not to be entertained if alternate statutory remedies are available, except in cases falling within Chhabil Dass, (2014) 1 SCC 603],. Thus, while it can be said that this Court has recognised some exceptions to the rule of alternative tatutory authority has not acted in accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has ed in total violation of the principles of natural Nathmal, AIR 1964 SC Titaghur Paper Mills SCC 433: 1983 SCC the High Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available to the aggrieved person or the statute under complained of has been taken itself contains a mechanism for redressal of grievance still holds the field. Therefore, when a statutory forum is created by law for redressal of grievances, a writ petition should not be entertained ignoring the statutory (emphasis supplied) W.P.(C) 17415/2022

40. The exceptions under which the High Court may exercise its jurisdiction under Article 226 of the Constitution notwithstanding the availability of alternate remedy, were Harbans Lal Sahnia v. Indian Oil Corpn. Ltd., (2003) 2 SCC 107 “7. So far as the view taken by the High Court that the remedy by way of recourse to arbitration clause was available to the appellants and therefore the writ petition filed by the a was liable to be dismissed is concerned, suffice it to observe that the rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion. In an appropriate case, in spite of availab alternative remedy, the High Court may still exercise its writ jurisdiction in at least three contingencies: ( petition seeks enforcement of any of the fundamental rights; ( where there is failure of principles of natural where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged. (See Corpn. v. Registrar of Trade Marks

41. In Varimadugu Obi Reddy v. B. Sreenivasul Hon'ble Apex Court exercise of jurisdiction under Article 226 of the Constitution without insisting on exhaustion of alternative statutory remedy available under the law, following words:

36. In the instant case, although the respondent borrowers initially approached the Debts Recovery Tribunal by filing an application under Section 17 of the order of the Tribunal indeed was appealable under Section 18 of the Act subject to the compliance of condition of pre and without exhausting the statutory remedy of appeal, the respondent borrowers approached the High Court by f writ application under Article 226 of the Constitution. deprecate such practice of entertaining the writ application by DRAFT RFA 832/2016 13.05. The exceptions under which the High Court may exercise its jurisdiction under Article 226 of the Constitution notwithstanding the availability of alternate remedy, were again articulated by the Hon’ble Supreme Court al Sahnia v. Indian Oil Corpn. Ltd., (2003) 2 SCC 107 So far as the view taken by the High Court that the remedy by way of recourse to arbitration clause was available to the appellants and therefore the writ petition filed by the a was liable to be dismissed is concerned, suffice it to observe that the rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of In an appropriate case, in spite of availab alternative remedy, the High Court may still exercise its writ jurisdiction in at least three contingencies: (i) where the writ petition seeks enforcement of any of the fundamental rights; ( where there is failure of principles of natural justice; or ( where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged. (See (Emphasis Supplied) Varimadugu Obi Reddy v. B. Sreenivasulu, (2023) 2 SCC 168 Hon'ble Apex Court deprecated the practice of entertaining exercise of jurisdiction under Article 226 of the Constitution without insisting on exhaustion of alternative statutory remedy available under the law, In the instant case, although the respondent borrowers initially approached the Debts Recovery Tribunal by filing an application under Section 17 of the Sarfaesi Act, 2002, but the order of the Tribunal indeed was appealable under Section 18 of the Act subject to the compliance of condition of pre and without exhausting the statutory remedy of appeal, the respondent borrowers approached the High Court by f writ application under Article 226 of the Constitution. deprecate such practice of entertaining the writ application by DRAFT RFA 832/2016 13.05. 202 3 The exceptions under which the High Court may exercise its jurisdiction under Article 226 of the Constitution notwithstanding the availability of by the Hon’ble Supreme Court in al Sahnia v. Indian Oil Corpn. Ltd., (2003) 2 SCC 107, as under: So far as the view taken by the High Court that the remedy by way of recourse to arbitration clause was available to the appellants and therefore the writ petition filed by the appellants was liable to be dismissed is concerned, suffice it to observe that the rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of In an appropriate case, in spite of availability of the alternative remedy, the High Court may still exercise its writ ) where the writ petition seeks enforcement of any of the fundamental rights; (ii) justice; or (iii) where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged. (See Whirlpool …..” (Emphasis Supplied) u, (2023) 2 SCC 168, the deprecated the practice of entertaining a writ petition in exercise of jurisdiction under Article 226 of the Constitution without insisting on exhaustion of alternative statutory remedy available under the law, in the In the instant case, although the respondent borrowers initially approached the Debts Recovery Tribunal by filing an Act, 2002, but the order of the Tribunal indeed was appealable under Section 18 of the Act subject to the compliance of condition of pre-deposit and without exhausting the statutory remedy of appeal, the respondent borrowers approached the High Court by filing the writ application under Article 226 of the Constitution. We deprecate such practice of entertaining the writ application by W.P.(C) 17415/2022 the High Court in exercise of jurisdiction under Article 226 of the Constitution without exhausting the alternative statuto remedy available under the law. to have been adopted to avoid the condition of pre contemplated under 2nd proviso to Section 18 of the 2002 Act.

42. The principle the existence of jurisdiction of the High Court under Article 226 of the Constitution of India. The bar of alternative remedy is a rule of convenience a self-imposed restriction on the exercise of power under Article 226 evolved through judicial precedents. entertain a writ petition under Article 226 of the Constitution if an effective and efficacious alternative stat

43. In the present context, t 'entertainability' of a by the Supreme Court Officer-cum-Assessing Authority, 2023 SCC OnLine SC 95 words: "4. …….. “entertainability” and “maintainability” of a writ petition are distinct concepts. The fine but real distinct the two ought not to be lost sight of. The objection as to “maintainability” goes to the root of the matter and if such objection were found to be of substance, the courts would be rendered incapable of even receiving the lis for adjudication. “entertainability” is entirely within the realm of discretion of the high courts, writ remedy being discretionary. petition despite being maintainable may not be entertained by a high court for very many reasons or DRAFT RFA 832/2016 13.05. the High Court in exercise of jurisdiction under Article 226 of the Constitution without exhausting the alternative statuto remedy available under the law. This circuitous route appears to have been adopted to avoid the condition of pre contemplated under 2nd proviso to Section 18 of the 2002 Act. (emphasis supplied) he principle that emerges from the aforementioned judgment existence of an alternative remedy does not completely bar the jurisdiction of the High Court under Article 226 of the Constitution of India. The bar of alternative remedy is a rule of convenience and discretion which restriction on the exercise of power under Article 226 evolved through judicial precedents. As a normal rule, the High Court entertain a writ petition under Article 226 of the Constitution if an effective alternative statutory remedy is available under the law. In the present context, the distinction between the 'maintainability' and ty' of a writ petition also needs to be borne in mind by the Supreme Court in Godrej Sara Lee Ltd. v. Excise and Assessing Authority, 2023 SCC OnLine SC 95 Though elementary, it needs to be restated that “entertainability” and “maintainability” of a writ petition are distinct concepts. The fine but real distinction between the two ought not to be lost sight of. The objection as to “maintainability” goes to the root of the matter and if such objection were found to be of substance, the courts would be rendered incapable of even receiving the lis for adjudication. On the other hand, the question of “entertainability” is entirely within the realm of discretion of the high courts, writ remedy being discretionary. petition despite being maintainable may not be entertained by a high court for very many reasons or relief could even DRAFT RFA 832/2016 13.05. 202 3 the High Court in exercise of jurisdiction under Article 226 of the Constitution without exhausting the alternative statutory This circuitous route appears to have been adopted to avoid the condition of pre-deposit contemplated under 2nd proviso to Section 18 of the 2002 Act. (emphasis supplied) ed judgments is that completely bar the jurisdiction of the High Court under Article 226 of the Constitution of India. and discretion which is restriction on the exercise of power under Article 226 evolved the High Court should not entertain a writ petition under Article 226 of the Constitution if an effective utory remedy is available under the law. 'maintainability' and needs to be borne in mind as restated Godrej Sara Lee Ltd. v. Excise and Taxation Assessing Authority, 2023 SCC OnLine SC 95, in the following Though elementary, it needs to be restated that “entertainability” and “maintainability” of a writ petition ion between the two ought not to be lost sight of. The objection as to “maintainability” goes to the root of the matter and if such objection were found to be of substance, the courts would be rendered incapable of even receiving the lis for On the other hand, the question of “entertainability” is entirely within the realm of discretion of the high courts, writ remedy being discretionary. A writ petition despite being maintainable may not be entertained relief could even W.P.(C) 17415/2022 be refused to the petitioner, despite setting up a sound legal point, if grant of the claimed relief would not further public interest. Hence, dismissal of a writ petition by a high court on the ground that the petitioner has not availed alternative remedy without, however, examining whether an exceptional case has been made out for such entertainment would not be proper."

44. It is not in dispute that the present writ petition is maintainable, but the question that looms large in the present petition is whether there is an effective alternative statutory remedy available to the petitioner to ventilate his grievance which is the whether this Court should entertain the instant petition.

45. For answering the question at hand, it is also imperative to statutory scheme with regard to the acts of op which could be entertained by the NCLT under the provisions of the Companies Act, 2013.

46. Chapter 16 of the Companies Act, 2013 242 and 244 thereof, mismanagement of to make an application to the Tribunal in cases of oppression mismanagement etc. Section 241(1)(a) of the the purpose to put an end to acts of oppression and mismanagement and speedily. Section 241 of the Act reads as thus: “241. Application to Tribunal for relief in cases of oppression, etc. complains that (a) the affairs of the company have been or are being conducted in a manner prejudicial to public interest or in a DRAFT RFA 832/2016 13.05. be refused to the petitioner, despite setting up a sound legal point, if grant of the claimed relief would not further public interest. Hence, dismissal of a writ petition by a high court on the ground that the petitioner has not availed alternative remedy without, however, examining whether an exceptional case has been made out for such entertainment would not be proper." (emphasis supplied) It is not in dispute that the present writ petition is maintainable, but the question that looms large in the present petition is whether there is an effective alternative statutory remedy available to the petitioner to ventilate his grievance which is the subject matter of the present petition, and if yes, whether this Court should entertain the instant petition. For answering the question at hand, it is also imperative to statutory scheme with regard to the acts of oppression and mismanageme which could be entertained by the NCLT under the provisions of the Companies Act, 2013. hapter 16 of the Companies Act, 2013, more specifically Section thereof, deals with the prevention of oppression and mismanagement of a company. Section 241 of the Act enables to make an application to the Tribunal in cases of oppression etc. Section 241(1)(a) of the Act has been the purpose to put an end to acts of oppression and mismanagement and speedily. Section 241 of the Act reads as thus:-

241. Application to Tribunal for relief in cases of oppression, etc.— (1) Any member of a company who complains that— (a) the affairs of the company have been or are being conducted in a manner prejudicial to public interest or in a DRAFT RFA 832/2016 13.05. 202 3 be refused to the petitioner, despite setting up a sound legal point, if grant of the claimed relief would not further public interest. Hence, dismissal of a writ petition by a high court on the ground that the petitioner has not availed the alternative remedy without, however, examining whether an exceptional case has been made out for such entertainment (emphasis supplied) It is not in dispute that the present writ petition is maintainable, but the question that looms large in the present petition is whether there is an effective alternative statutory remedy available to the petitioner to ventilate subject matter of the present petition, and if yes, For answering the question at hand, it is also imperative to examine the and mismanagement which could be entertained by the NCLT under the provisions of the more specifically Sections 241, prevention of oppression and Section 241 of the Act enables the petitioner to make an application to the Tribunal in cases of oppression, has been incorporated with the purpose to put an end to acts of oppression and mismanagement, promptly

241. Application to Tribunal for relief in cases of (1) Any member of a company who (a) the affairs of the company have been or are being conducted in a manner prejudicial to public interest or in a W.P.(C) 17415/2022 manner prejudicial or oppressive to him or any other member or members or in a manner prejudicial to the interests of the company; or (b) the material change, not being a change brought about by, or in the interests of, any creditors, including debenture holders or any class of shareholders of the company, has taken place in the management or control of the company, whether by an alteration in the ownership of the company‘s shares, or if it has no share capital, in its membership, or in any other manner whatsoever, and that by reason of such change, it is likely that the affairs of the company will be c interests or its members or any class of members, may apply to the Tribunal, provided such member has a right to apply under section 244, for an order under this Chapter. (2) The Central Government, if it is of the affairs of the company are being conducted in a manner prejudicial to public interest, it may itself apply to the Tribunal for an order under this Chapter.

47. The relevant part of under:- “242. Powers of Tribunal under section 241, the Tribunal is of the opinion (a) that the company‘s affairs have been or are being conducted in a manner prejudicial or oppressive to any member or members or prejudicial to public interests of the company; and (b) that to wind up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the making of a winding equitable that the company should be wound up,the Tribunal may, with a view to bringing to an end the matters complained of, make such order as it thinks fit.

DRAFT RFA 832/2016 13.05. manner prejudicial or oppressive to him or any other member or members or in a manner prejudicial to the interests of the company; or e material change, not being a change brought about by, or in the interests of, any creditors, including debenture holders or any class of shareholders of the company, has taken place in the management or control of the company, whether by an alteration in the Board of Directors, or manager, or in the ownership of the company‘s shares, or if it has no share capital, in its membership, or in any other manner whatsoever, and that by reason of such change, it is likely that the affairs of the company will be conducted in a manner prejudicial to its interests or its members or any class of members, may apply to the Tribunal, provided such member has a right to apply under section 244, for an order under this Chapter. (2) The Central Government, if it is of the opinion that the affairs of the company are being conducted in a manner prejudicial to public interest, it may itself apply to the Tribunal for an order under this Chapter. The relevant part of Section 242 of the Companies Act, 2013 reads as Powers of Tribunal.— (1) If, on any application made under section 241, the Tribunal is of the opinion— (a) that the company‘s affairs have been or are being conducted in a manner prejudicial or oppressive to any member or members or prejudicial to public interest or in a manner prejudicial to the interests of the company; and (b) that to wind up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the making of a winding-up order on the ground that it wa equitable that the company should be wound up,the Tribunal may, with a view to bringing to an end the matters complained of, make such order as it thinks fit.

DRAFT RFA 832/2016 13.05. 202 3 manner prejudicial or oppressive to him or any other member or members or in a manner prejudicial to the interests of the e material change, not being a change brought about by, or in the interests of, any creditors, including debenture holders or any class of shareholders of the company, has taken place in the management or control of the company, whether the Board of Directors, or manager, or in the ownership of the company‘s shares, or if it has no share capital, in its membership, or in any other manner whatsoever, and that by reason of such change, it is likely that the affairs of onducted in a manner prejudicial to its may apply to the Tribunal, provided such member has a right to apply under section 244, for an order under this Chapter. opinion that the affairs of the company are being conducted in a manner prejudicial to public interest, it may itself apply to the Tribunal Section 242 of the Companies Act, 2013 reads as (1) If, on any application made (a) that the company‘s affairs have been or are being conducted in a manner prejudicial or oppressive to any member or members or interest or in a manner prejudicial to the (b) that to wind up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the up order on the ground that it was just and equitable that the company should be wound up,the Tribunal may, with a view to bringing to an end the matters complained of, make W.P.(C) 17415/2022 (2) Without prejudice to the generality of the powers under sub section (1), an order (a) the regulation of conduct of affairs of the company in future; (b) the purchase of shares or interests of any members of the company by other members thereof or by the company;

(c) in the case of a purchase of aforesaid, the consequent reduction of its share capital;

(d) restrictions on the transfer or allotment of the shares of the company;

(e) the termination, setting aside or modification, of any agreement, howsoever arrived at, b managing director, any other director or manager, upon such terms and conditions as may, in the opinion of the Tribunal, be just and equitable in the circumstances of the case; f) the termination, setting aside or modification of between the company and any person other than those referred to in clause (e): Provided that no such agreement shall be terminated, set aside or modified except after due notice and after obtaining the consent of the party concerned; (g) the setting aside of any transfer, delivery of goods, payment, execution or other act relating to property made or done by or against the company within three months before the date of the application under this section, which would, if made or done by or against an individual, be deemed in his insolvency to be a fraudulent preference; (h) removal of the managing director, manager or any of the directors of the company;

(i) recovery of undue gains made by any managing director, manager or director during the p and the manner of utilisation of the recovery including transfer to Investor Education and Protection Fund or repayment to identifiable victims; (j) the manner in which the managing director or manager of the company may be existing managing director or manager of the company made under clause (h); DRAFT RFA 832/2016 13.05. (2) Without prejudice to the generality of the powers under sub section (1), an order under that subsection may provide for (a) the regulation of conduct of affairs of the company in future; (b) the purchase of shares or interests of any members of the company by other members thereof or by the company;

(c) in the case of a purchase of its shares by the company as aforesaid, the consequent reduction of its share capital;

(d) restrictions on the transfer or allotment of the shares of the

(e) the termination, setting aside or modification, of any agreement, howsoever arrived at, between the company and the managing director, any other director or manager, upon such terms and conditions as may, in the opinion of the Tribunal, be just and equitable in the circumstances of the case; f) the termination, setting aside or modification of any agreement between the company and any person other than those referred to Provided that no such agreement shall be terminated, set aside or modified except after due notice and after obtaining the consent of the party concerned; setting aside of any transfer, delivery of goods, payment, execution or other act relating to property made or done by or against the company within three months before the date of the application under this section, which would, if made or done by or inst an individual, be deemed in his insolvency to be a fraudulent preference; (h) removal of the managing director, manager or any of the directors of the company;

(i) recovery of undue gains made by any managing director, manager or director during the period of his appointment as such and the manner of utilisation of the recovery including transfer to Investor Education and Protection Fund or repayment to identifiable victims; (j) the manner in which the managing director or manager of the company may be appointed subsequent to an order removing the existing managing director or manager of the company made under clause (h); DRAFT RFA 832/2016 13.05. 202 3 (2) Without prejudice to the generality of the powers under subunder that subsection may provide for— (a) the regulation of conduct of affairs of the company in future; (b) the purchase of shares or interests of any members of the company by other members thereof or by the company; its shares by the company as aforesaid, the consequent reduction of its share capital;

(d) restrictions on the transfer or allotment of the shares of the

(e) the termination, setting aside or modification, of any etween the company and the managing director, any other director or manager, upon such terms and conditions as may, in the opinion of the Tribunal, be any agreement between the company and any person other than those referred to Provided that no such agreement shall be terminated, set aside or modified except after due notice and after obtaining the setting aside of any transfer, delivery of goods, payment, execution or other act relating to property made or done by or against the company within three months before the date of the application under this section, which would, if made or done by or inst an individual, be deemed in his insolvency to be a (h) removal of the managing director, manager or any of the

(i) recovery of undue gains made by any managing director, eriod of his appointment as such and the manner of utilisation of the recovery including transfer to Investor Education and Protection Fund or repayment to (j) the manner in which the managing director or manager of the appointed subsequent to an order removing the existing managing director or manager of the company made W.P.(C) 17415/2022 (k) appointment of such number of persons as directors, who may be required by the Tribunal to report to the Tribunal on such matters as the Tribunal may direct;

(l) imposition of costs as may be deemed fit by the Tribunal;

(m) any other matter for which, in the opinion of the Tribunal, it is just and equitable that provision should be made.

48. Section 244 of the NCLT under Section 241 of the Act thus: “244. Right to apply under section 241. members of a company shall have the right to apply under section 241, namely: (a) in the case of a company having a share capital, not less than one hundred members of the company or not less than one-tenth of the total number of its members, whichever is less, or any member or members holding not less than one the issued s condition that the applicant or applicants has or have paid all calls and other sums due on his or their shares; (b) in the case of a company not having a share capital, not less than one Provided that the Tribunal may, on an application made to it in this behalf, waive all or any of the requirements specified in clause (a) or clause (b) so as to enable the members to apply under section 241. Explanation. share or shares are held by two or more persons jointly, they shall be counted only as one member. (2) Where any members of a company are entitled to make an application under subsection (1), any one or more of them DRAFT RFA 832/2016 13.05. (k) appointment of such number of persons as directors, who may be required by the Tribunal to report to the Tribunal on such as the Tribunal may direct;

(l) imposition of costs as may be deemed fit by the Tribunal;

(m) any other matter for which, in the opinion of the Tribunal, it is just and equitable that provision should be made.”….. Section 244 of the Act provides as to who has the right to apply to the NCLT under Section 241 of the Act. The relevant part of Section 244

244. Right to apply under section 241.— (1) The following members of a company shall have the right to apply under section 241, namely:— (a) in the case of a company having a share capital, not less than one hundred members of the company or not less than tenth of the total number of its members, whichever is less, or any member or members holding not less than one the issued share capital of the company, subject to the condition that the applicant or applicants has or have paid all calls and other sums due on his or their shares; (b) in the case of a company not having a share capital, not less than one-fifth of the total number of its members: Provided that the Tribunal may, on an application made to it in this behalf, waive all or any of the requirements specified in clause (a) or clause (b) so as to enable the members to apply under section 241. Explanation.—For the purposes of this sub-section, where any share or shares are held by two or more persons jointly, they shall be counted only as one member. (2) Where any members of a company are entitled to make an application under subsection (1), any one or more of them DRAFT RFA 832/2016 13.05. 202 3 (k) appointment of such number of persons as directors, who may be required by the Tribunal to report to the Tribunal on such

(l) imposition of costs as may be deemed fit by the Tribunal;

(m) any other matter for which, in the opinion of the Tribunal, it is right to apply to the Section 244 reads (1) The following members of a company shall have the right to apply under (a) in the case of a company having a share capital, not less than one hundred members of the company or not less than tenth of the total number of its members, whichever is less, or any member or members holding not less than one-tenth of hare capital of the company, subject to the condition that the applicant or applicants has or have paid all (b) in the case of a company not having a share capital, not number of its members: Provided that the Tribunal may, on an application made to it in this behalf, waive all or any of the requirements specified in clause (a) or clause (b) so as to enable the members to apply section, where any share or shares are held by two or more persons jointly, they (2) Where any members of a company are entitled to make an application under subsection (1), any one or more of them W.P.(C) 17415/2022 having obtained the consent in writing of the rest, may make the application on behalf and for the benefit of all of the

49. The controversy involved in the present petition and the relief sought the petitioner needs to be examined in the light of the provisions as well as the

50. As far as the jurisdiction dated 21.11.2022 of learned Ombudsman is concerned, this Court in Siddharth OnLine Del 3967, has already taken a view that an order passed by the Ombudsman or any action taken by him / her can be set aside or reverse the NCLT, if the same the order of Ombudsman can be NCLT. The relevant paragraph of the judgment reads as under:

“22. If the appointment of Ombudsman is contrary to the laws laid down in the AoA, it is always open for the NCLT to stay the effect of the resolution dated 10.04.2023 and reverse any order passed by the Ombudsman or any action taken by him/her if it is not in the interest of the DDCA. The Petitioner has not made out a case that it is imperative for this Cou Court rt to entertain the present Writ Petition even though an equally efficacious alternative remedy/forum is available to the Petitioner and that the Ombudsman can pass such orders which are irreversible in nature and cannot be rectified if they are found to be be faulty faulty. This Court can take judicial notice of the fact that the NCLT is situated in Delhi and it was always open for the Petitioner to approach the NCLT which is the forum under the Companies Act to address the grievances which are raised by the Petitioner in the present Writ Petition. The present case also does not fall within the exceptions that have been laid down by the Apex Court in South Indian Bank Ltd. (supra) which would compel this Court to entertain the
DRAFT RFA 832/2016 13.05. having obtained the consent in writing of the rest, may make the application on behalf and for the benefit of all of the The controversy involved in the present petition and the relief sought needs to be examined in the light of the aforesaid statutory as well as the judicial precedents on the subject. jurisdiction of NCLT to entertain the challenge to the order dated 21.11.2022 of learned Ombudsman is concerned, a Co- Siddharth Sahib Singh v. Apex Council of DDCA, 2023 SCC, has already taken a view that an order passed by the Ombudsman or any action taken by him / her can be set aside or reverse the same is not in the interest of the DDCA. It thu the order of Ombudsman can be the subject matter of challenge before the The relevant paragraph of the judgment reads as under: If the appointment of Ombudsman is contrary to the laws laid down in the AoA, it is always open for the NCLT to stay the effect of the resolution dated 10.04.2023 and reverse any order passed by the Ombudsman or any action taken by him/her if it is not in the interest of the DDCA. The Petitioner has not made out a case that it is imperative for this Court to entertain the present Writ Petition even though an equally efficacious alternative remedy/forum is available to the Petitioner and that the Ombudsman can pass such orders which are irreversible in nature and cannot be rectified if they are found to be faulty Court can take judicial notice of the fact that the NCLT is situated in Delhi and it was always open for the Petitioner to approach the NCLT which is the forum under the Companies Act to address the grievances which are raised Petitioner in the present Writ Petition. The present case also does not fall within the exceptions that have been laid down by the Apex Court in South Indian Bank (supra) which would compel this Court to entertain the DRAFT RFA 832/2016 13.05. 202 3 having obtained the consent in writing of the rest, may make the application on behalf and for the benefit of all of them”…. The controversy involved in the present petition and the relief sought by aforesaid statutory challenge to the order -ordinate Bench of Sahib Singh v. Apex Council of DDCA, 2023 SCC, has already taken a view that an order passed by the Ombudsman or any action taken by him / her can be set aside or reversed by is not in the interest of the DDCA. It thus, follows that subject matter of challenge before the The relevant paragraph of the judgment reads as under:- If the appointment of Ombudsman is contrary to the the NCLT to stay the effect of the resolution dated 10.04.2023 and reverse any order passed by the Ombudsman or any action taken by him/her if it is not in the interest of the DDCA. The Petitioner has not made out a case that it is imperative rt to entertain the present Writ Petition even though an equally efficacious alternative remedy/forum is available to the Petitioner and that the Ombudsman can pass such orders which are irreversible in nature and e faulty. This Court can take judicial notice of the fact that the NCLT is situated in Delhi and it was always open for the Petitioner to approach the NCLT which is the forum under the Companies Act to address the grievances which are raised Petitioner in the present Writ Petition. The present case also does not fall within the exceptions that have been South Indian Bank (supra) which would compel this Court to entertain the W.P.(C) 17415/2022 present Writ Petition even in the efficacious alternative remedy to the Petitioner."

51. Even the relief sought in declaration has been sought tenure of one year from the date of appointment the NCLT, in as much a Sudhir Kumar Aggarwal, 2020 SCC OnLine 1223 appointment of an Ombudsman would also form management of the affairs of the company manner of Ombudsman’s appointment too will come within the ambit of NCLT. This being the position Ombudsman, by nece NCLT’s jurisdiction. "20. What emanates from the preceding arguments and on consideration of the comparative chart hereinabove, is that sections 241, 242 and 244 of the Companies Act deal with all the issues which have been raised in the suit been specifically conferred powers to address grievances relating to the affairs of the company, which may be prejudicial or oppressive to any for issues of appointment of directors. The appointment of an Ombudsman, would also form a part of the conduct and management of the affairs of the company. Court has held in Section 430 is vast, and jurisdiction of the civil court is completely barred when the power to adjudicate vests in the Tribunal.

21. As has been held in the Board of Directors would be amenable to jurisdiction of the NCLT. The issue is the same in the present suit. the lis and grievances raised in the suit can be agitated only before the NCLT. A civil court would have no jurisdiction.

DRAFT RFA 832/2016 13.05. present Writ Petition even in the presence of an equally efficacious alternative remedy to the Petitioner." the relief sought in para (B) of the prayer declaration has been sought that the tenure of the Ld. Ombudsman is a fixed year from the date of appointment, will fall within the domain of, in as much as, this Court in Delhi & District Cricket Association v. Sudhir Kumar Aggarwal, 2020 SCC OnLine 1223 has observed appointment of an Ombudsman would also form part of the conduct and management of the affairs of the company and the controversy as regard the manner of Ombudsman’s appointment too will come within the ambit of This being the position, the dispute as regard the tenure of the by necessary implication, will also fall within the NCLT’s jurisdiction. The relevant part of the said decision reads thus: What emanates from the preceding arguments and on consideration of the comparative chart hereinabove, is that 241, 242 and 244 of the Companies Act deal with all the issues which have been raised in the suit. The NCLT has been specifically conferred powers to address grievances relating to the affairs of the company, which may be prejudicial or oppressive to any member of the company, or for issues of appointment of directors. The appointment of an Ombudsman, would also form a part of the conduct and management of the affairs of the company. The Supreme Court has held in Shashi Prakash Khemka that the scope of tion 430 is vast, and jurisdiction of the civil court is completely barred when the power to adjudicate vests in the As has been held in Viji Joseph, the issue of election to the Board of Directors would be amenable to jurisdiction of LT. The issue is the same in the present suit. and grievances raised in the suit can be agitated only before the NCLT. A civil court would have no jurisdiction.

DRAFT RFA 832/2016 13.05. 202 3 presence of an equally prayer clause wherein a the tenure of the Ld. Ombudsman is a fixed fall within the domain of Delhi & District Cricket Association v. observed that the part of the conduct and and the controversy as regard the manner of Ombudsman’s appointment too will come within the ambit of the dispute as regard the tenure of the fall within the purview of the The relevant part of the said decision reads thus: What emanates from the preceding arguments and on consideration of the comparative chart hereinabove, is that 241, 242 and 244 of the Companies Act deal with all. The NCLT has been specifically conferred powers to address grievances relating to the affairs of the company, which may be member of the company, or for issues of appointment of directors. The appointment of an Ombudsman, would also form a part of the conduct and The Supreme that the scope of tion 430 is vast, and jurisdiction of the civil court is completely barred when the power to adjudicate vests in the, the issue of election to the Board of Directors would be amenable to jurisdiction of LT. The issue is the same in the present suit. Likewise, and grievances raised in the suit can be agitated only before the NCLT. A civil court would have no jurisdiction. As W.P.(C) 17415/2022 far as the specific allegation apropos the manner in which the Ombudsman w which will come within the ambit of Tribunal i.e. appointment of people who would conduct the affairs of the company/the management. of appointments at the AGM in question, c examined by the NCLT. That being the position, the issue of maintainability ought to have been determined first by the trial court. It did not have jurisdiction to entertain the suit. Accordingly, the impugned order is set aside. The appeal is allowed."

52. Reading of above quoted para 21 from (Supra) also makes amply clear that i qua the appointment and election of Director DDCA / respondent no. 1, so, the relief seeking hold elections for retiring directors on or before 30.09.2022

(D) of the prayer clause nominees/directors have retired with effect from letter dated 01.09.2020 relate to the issue of of the board of directors will also necessarily fall within the jurisdiction of the NCLT.

53. Likewise, the notice dated 04.12.2022 and to reappoint them as members of the Apex Council (Director of the DDCA), as well as, proposing to hold elections to the Vacant post of on or before a particular date DRAFT RFA 832/2016 13.05. far as the specific allegation apropos the manner in which the Ombudsman was appointed are concerned, it too, is an issue which will come within the ambit of Tribunal i.e. appointment of people who would conduct the affairs of the company/the management. The video recording of the manner of appointments at the AGM in question, could well be examined by the NCLT. That being the position, the issue of maintainability ought to have been determined first by the trial court. It did not have jurisdiction to entertain the suit. Accordingly, the impugned order is set aside. The appeal is (Emphasis Supplied) Reading of above quoted para 21 from Sudhir Kumar Aggarwal also makes amply clear that it is no more res integra the appointment and election of Director(s) to the Board of Directors of DDCA / respondent no. 1, is amenable to the jurisdiction of the NCLT. seeking a declaration that the DDCA/respondent no.1 is bound to hold elections for retiring directors on or before 30.09.2022 of the prayer clause, as well as, the declaration that the Government have retired with effect from 31.08.2022 letter dated 01.09.2020 as prayed in para (F) of the prayer clause issue of election/nomination & tenure of directors of the board of directors/Apex Council of the DDCA/respondent no. 1 y fall within the jurisdiction of the NCLT. the objections of the petitioner apropos agenda 4 and 5 of the notice dated 04.12.2022 proposing to retire the Directors mentioned therein them as members of the Apex Council (Director of the proposing to hold elections to the Vacant post of a particular date, contrary to the Articles of Association, DRAFT RFA 832/2016 13.05. 202 3 far as the specific allegation apropos the manner in which the as appointed are concerned, it too, is an issue which will come within the ambit of Tribunal i.e. appointment of people who would conduct the affairs of the The video recording of the manner ould well be examined by the NCLT. That being the position, the issue of maintainability ought to have been determined first by the trial court. It did not have jurisdiction to entertain the suit. Accordingly, the impugned order is set aside. The appeal is (Emphasis Supplied) Sudhir Kumar Aggarwal res integra that the dispute to the Board of Directors of amenable to the jurisdiction of the NCLT. It being respondent no.1 is bound to as prayed in para that the Government 31.08.2022 in terms of their of the prayer clause, essentially of directors or composition respondent no. 1, which y fall within the jurisdiction of the NCLT. agenda 4 and 5 of the mentioned therein, them as members of the Apex Council (Director of the proposing to hold elections to the Vacant post of Directors, contrary to the Articles of Association, are also W.P.(C) 17415/2022 issues which would fall within the purview of mismanagement and oppression and will come within the ambit of powers of NCLT specifically been conferred upon the NCLT to bring to an end the matters of,[1]

(ii) to regulate the conduct of the company in future any other matter which

54. In regard to the relief sought in para respondent no. 1 to appoint a CEO or CFO in terms of the judgment of the Hon’ble Supreme Court the said relief. However, as jurisdiction to make the company which is or its members or, Therefore, it is well within the jurisdiction of the NCLT to entertain the prayer articulated in para (G) of the prayer clause as well.

55. As far as the contention of the learned Senior Counsel for the petitioner in respect to the bar under Section 244 of Company Law Tribunal under Section 241 is concerned, the Tribunal has been granted the power to relax minimum number of not the case of the petitioner that he terms of the first proviso to Section 244 (1) of the Act to waive condition and that the same has been declined constrained to approach this Court under Article 226 of the Constitution of Section 242(1) of the Companies Act, 2013. Section 242(2)(a) of the Companies Act, 2013. Section 242(2)(m) of the Companies Act, 2013.

DRAFT RFA 832/2016 13.05. which would fall within the purview of mismanagement and oppression will come within the ambit of powers of NCLT as jurisdiction has been conferred upon the NCLT to pass appropriate bring to an end the matters of mismanagement and oppression regulate the conduct of the company in future[2] and any other matter which in the opinion of the NCLT is just and equitable. In regard to the relief sought in para (G) praying for respondent no. 1 to appoint a CEO or CFO in terms of the judgment of the Hon’ble Supreme Court, to be noted that the petitioner did not lay emphasis on However, as noted, the NCLT has been conferred an order, which it thinks fit to bring to the company which is oppressive or prejudicial to the interest of the company, for regulating the conduct of the company’s affairs Therefore, it is well within the jurisdiction of the NCLT to entertain the prayer articulated in para (G) of the prayer clause as well. contention of the learned Senior Counsel for the petitioner bar under Section 244 of Act to approach the National Company Law Tribunal under Section 241 is concerned, suffice it to say that the Tribunal has been granted the power to relax the requirement of having the minimum number of members needed to approach the Tribunal not the case of the petitioner that he has approached the NCLT with a prayer in terms of the first proviso to Section 244 (1) of the Act to waive the same has been declined, therefore, the petitioner is to approach this Court under Article 226 of the Constitution of of the Companies Act, 2013. Section 242(2)(a) of the Companies Act, 2013. the Companies Act, 2013.

DRAFT RFA 832/2016 13.05. 202 3 which would fall within the purview of mismanagement and oppression as jurisdiction has appropriate orders (i) to of mismanagement and oppression complained and (iii) to provide for and equitable.[3] praying for a direction to the respondent no. 1 to appoint a CEO or CFO in terms of the judgment of the not lay emphasis on NCLT has been conferred ample to bring to an end any act of oppressive or prejudicial to the interest of the company for regulating the conduct of the company’s affairs. Therefore, it is well within the jurisdiction of the NCLT to entertain the prayer contention of the learned Senior Counsel for the petitioner to approach the National suffice it to say that the requirement of having the to approach the Tribunal. Further, it is approached the NCLT with a prayer in terms of the first proviso to Section 244 (1) of the Act to waive off the, therefore, the petitioner is to approach this Court under Article 226 of the Constitution of W.P.(C) 17415/2022 India. This Court in somewhat similar situation i observed that the petitioner therein instead filing a writ petition ought to have approached the NCLT at the first instance and it is only in the event of NCLT refusing to waive of members filing the application, he could contending that no equally efficacious alternate remedy is left to him Reference to the relevant paragraph of the said decision could ad be made at this stage, which reads thus: “20.Though Section 244 (1)(b) of the Companies Act provides that an application under Section 241 of the Companies Act can be entertained only if it is supported by one total number of mem power to waive of this requirement. The Petitioner, therefore, ought to have approached the NCLT and if the NCLT would have refused to waive off the stipulated requirement of support of one-fifth members of the company for the Petitioner to approach this Court by contending that no equally efficacious alternative remedy is left to him. It cannot be said that this Court does not exercise its jurisdiction under Article 226 of the Constitution of Ind damage would be caused to the DDCA and the same cannot be rectified by the Courts or that DDCA will be subjected to an irreparable loss which needs urgent restraint orders.

56. Keeping in view the decisions in Siddharth Sahib Singh (Supra) (Supra), this Court is of considered view that the petitioner has an alternate efficacious statutory remedy available to him to seek redressal of his grievances before the NCLT. defined exceptions to the rule of alternate remedy. to the law laid down by the Hon’ble Supreme Court DRAFT RFA 832/2016 13.05. This Court in Siddharth Sahib Singh (Supra) while ar situation in a case pertaining to DDCA/ respondent no. 1 has observed that the petitioner therein instead filing a writ petition ought to have approached the NCLT at the first instance and it is only in the event of NCLT refusing to waive off the stipulated requirement of requisite number of members filing the application, he could have approached this Court contending that no equally efficacious alternate remedy is left to him eference to the relevant paragraph of the said decision could ad be made at this stage, which reads thus:-

20. Though Section 244 (1)(b) of the Companies Act provides that an application under Section 241 of the Companies Act can be entertained only if it is supported by one total number of members of the company but the NCLT has power to waive of this requirement. The Petitioner, therefore, ought to have approached the NCLT and if the NCLT would have refused to waive off the stipulated requirement of support fifth members of the company then it was always open for the Petitioner to approach this Court by contending that no equally efficacious alternative remedy is left to him. It cannot be said that this Court does not exercise its jurisdiction under Article 226 of the Constitution of Indian an irreversible damage would be caused to the DDCA and the same cannot be rectified by the Courts or that DDCA will be subjected to an irreparable loss which needs urgent restraint orders. Keeping in view the subject matter of the present petition, a Siddharth Sahib Singh (Supra) and Sudhir Kumar Aggarwal this Court is of considered view that the petitioner has an alternate efficacious statutory remedy available to him to seek redressal of his before the NCLT. Clearly, it is not a case falling under the well defined exceptions to the rule of alternate remedy. Accordingly, having regard to the law laid down by the Hon’ble Supreme Court, as discussed above, DRAFT RFA 832/2016 13.05. 202 3 while dealing with a respondent no. 1 has observed that the petitioner therein instead filing a writ petition ought to have approached the NCLT at the first instance and it is only in the event of NCLT the stipulated requirement of requisite number of approached this Court contending that no equally efficacious alternate remedy is left to him. eference to the relevant paragraph of the said decision could advantageously

20. Though Section 244 (1)(b) of the Companies Act provides that an application under Section 241 of the Companies Act can be entertained only if it is supported by one-fifth of the bers of the company but the NCLT has power to waive of this requirement. The Petitioner, therefore, ought to have approached the NCLT and if the NCLT would have refused to waive off the stipulated requirement of support then it was always open for the Petitioner to approach this Court by contending that no equally efficacious alternative remedy is left to him. It cannot be said that this Court does not exercise its jurisdiction under ian an irreversible damage would be caused to the DDCA and the same cannot be rectified by the Courts or that DDCA will be subjected to an irreparable loss which needs urgent restraint orders.” the present petition, as well as, the Sudhir Kumar Aggarwal this Court is of considered view that the petitioner has an alternate efficacious statutory remedy available to him to seek redressal of his t a case falling under the well- Accordingly, having regard as discussed above, this W.P.(C) 17415/2022 Court is not inclined to Constitution.

57. The writ petition, along with pending applications, if any, disposed of, with liberty to the petitioner to accordance with law

58. Before parting with judgment, it needs to be brought arguments were concluded by both sides, Mr. Sacchin Puri, learned senior counsel appeared along with Mr. Siddharth Sahib Singh, Secretary of the respondent no. 1 (who has been arrayed a petition) submitted filed on behalf of the respondent no. 1 has not been signed by the respondent no. 3. Further, referring to Article 45 of the Articles of Association Mr. Puri submitted that the respondent no. 1 shall or be sued in the name of the Secretary, and without the authorization of the secretary, the respondent no. 1 cannot be represented before this Court. filed by the respondent no.3 seeking any relief premised on the afores allegation, therefore, an allegation which with in the present judgment.

NOVEMBER 23, 2023 N.S. ASWAL DRAFT RFA 832/2016 13.05. not inclined to exercise jurisdiction under Article 226 of the The writ petition, along with pending applications, if any, with liberty to the petitioner to take appropriate accordance with law, if so advised. Before parting with judgment, it needs to be brought arguments were concluded by both sides, Mr. Sacchin Puri, learned senior counsel appeared along with Mr. Siddharth Sahib Singh, Secretary of the who has been arrayed as respondent no. 3 to the present submitted that the vakalatnama dated 17.01.2023 which has been filed on behalf of the respondent no. 1 has not been signed by the respondent referring to Article 45 of the Articles of Association Mr. Puri submitted that the respondent no. 1 shall or be sued in the name of and without the authorization of the secretary, the respondent no. 1 cannot be represented before this Court. However, no application was ndent no.3 seeking any relief premised on the afores allegation, therefore, this Court refrains from making any observation allegation which is beyond the contours of the controversy raised and dealt present judgment. VIKAS, 2023 DRAFT RFA 832/2016 13.05. 202 3 jurisdiction under Article 226 of the The writ petition, along with pending applications, if any, is thus, appropriate legal remedies in Before parting with judgment, it needs to be brought out that when the arguments were concluded by both sides, Mr. Sacchin Puri, learned senior counsel appeared along with Mr. Siddharth Sahib Singh, Secretary of the s respondent no. 3 to the present dated 17.01.2023 which has been filed on behalf of the respondent no. 1 has not been signed by the respondent referring to Article 45 of the Articles of Association (AoA), Mr. Puri submitted that the respondent no. 1 shall or be sued in the name of and without the authorization of the secretary, the respondent However, no application was ndent no.3 seeking any relief premised on the aforesaid from making any observation on such controversy raised and dealt VIKAS MAHAJAN, J.