Internex Poly Pvt. Ltd. vs Gangotri Infrastructure Pvt. Ltd.

Per: Justice Rakesh Kumar Jain:

This appeal is directed against the order dated 08.12.2020, passed by the National Company Law Tribunal, Ahmadabad Bench, Ahmadabad, Court 2 (in short ‘Tribunal’) by which, while allowing the application bearing I.A. No. 219 of 2020 filed in C.P. 46/NCLT/Ahm/2017 (in short ‘main petition’) by the Appellant for deleting the names of Respondent No. 4 to 8 and 13 from the array of the Respondents has been saddled with a cost of Rs. 5,00,000/- to be distributed to Respondent No. 4 to 8 and 13 equally towards compensation for having suffered in their business and faced irreparable loss to their name and fame in the society being prejudiced by the order of stay which continued to operate against them in the main petition.

In brief, the Appellants herein filed CP No. 46 of 2017 before the Tribunal against the Company ‘Gangotri Infrastructure Pvt. Ltd.’ (Respondent No. 1) and Respondent No. 2 to 13 under Section 241, 242 and 243 of the Companies Act, 2013 (in short ‘Act’).

The first order in the main petition was passed on 10.04.2017 and the order of stay was passed on 08.05.2017 against Respondent No. 4 to 8 and 13 which continued from time to time and ultimately vacated on 18.12.2019 with the observation that “under such circumstances, when petitioner is also not pursuing the matter to get it concluded which is filed under Section 241, 242 and 243 and pending since long and more so when Respondent No. 5 to 8 nowhere related with such transaction, the recourse of which lie in the Civil Court, hence, the order so passed on 08.05.2017 is hereby vacated”

The order of stay was thus continued against the Respondents from 08.05.2017 till 18.12.2019. There was dispute about the sale of a plot owned by Respondent No. 1 (Company) which is alleged to have been sold at a lesser price. The Appellant raised the said dispute in the main petition filed under Section 241, 242 and 243 of the Act and also challenged the sale by way of Civil Suit before the Taluka Court at Vapi, therefore, the Appellants filed an application bearing 219 of 2020 praying therein that the names of Respondent No. 4 to 8 and 13 from the main petition be deleted and further prayed that “Para 25. Reliefs Sought, final reliefs: (b) that this Tribunal be restrained for transferring of the plot no. 224 to Respondent No. 4 to 8 till disposal of the petition and assigned/transferred of plot of land no. 224 to Respondent No. 4 to 8 to be declared as illegal and void ab-initio. Para 25 Interim Reliefs: 1 a.) 1.Transferring/assigning of the plot no. 224 to Respondents No. 4 to 8 till disposal of the petition. 16b) restraining Respondents No. 4 to 8 for dealing / assigning/ transferring of the plot no. 224 to any person till disposal of the petition. Further status quo to be maintained”.

It is pertinent to mention that the main petition was contested by Respondent No. 4 to 8 and 13 by filing their reply and after two years the order of stay granted to the Appellant on 08.05.2017 was vacated on 18.12.2019 and the transaction of sale of the plot which was subject matter of the main petition was brought to challenge by the Appellant before the Civil Court by way of Civil Suit and since the Appellant could not have continued parallel proceedings on the same issue/cause of action in two Courts i.e. before the Tribunal as well as the Civil Court, therefore, an application bearing 219 of 2020 was filed to delete the names of Respondent No. 4 to 8 and 13 from the array of parties in the main petition and also sought deletion of the prayers made against them as the final reliefs as well as the interim reliefs.

The Application filed by the Appellant was allowed by the Tribunal in the following manner:-

In the present appeal, the grievance of the appellant, recorded in the order dated 02.09.2021 by this Court, is only confined to the directions given in the impugned order to the Appellant to pay a token amount of Rs. 5,00,000/- to be distributed to Respondents No. 4 to 8 and 13 equally as they have suffered not only in their business but name and fame in the society which amounts to irreparable loss.

Counsel for the Appellant has argued that the Tribunal has committed an error in awarding the amount as cost to Respondent No. 4 to 8 and 13 as Respondent No. 4 to 8 and 13 has rightly been impleaded as Respondent in the main petition initially but later on the Appellant challenged the said transaction by way of civil suit and in order to avoid objection regarding parallel proceedings, their names have been deleted which does not attract the imposition of cost of Rs. 5,00,000/-.

We have heard Counsel for the Appellant and perused the record. The very fact that the stay granted against the Respondent No. 4 to 8 and 13 continued for two years and was vacated on 18.12.2019 may be with an observation that Respondent No. 4 to 8 were nowhere related with such transaction, the recourse of which lie in the civil court and also the fact that the said order was not challenged rather the civil suit was filed by the Appellants and thereafter in order to avoid legal complication of maintaining the main petition on the same cause of action against Respondent No. 4 to 8 and 13 against whom the civil suit has also been filed on the same cause of action, application for deletion of their name and the prayer made in the main petition would be enough to show that Respondent No. 4 to 8 and 13 were unnecessary dragged in the litigation initiated against them in the main petition in which Respondent No. 4 to 8 and 13 had to file their reply, contested the application and the said proceedings continued for two years till the stay was vacated and the application bearing 219 of 2020 was filed in the year 2020 is sufficient to hold that Respondent No. 4 to 8 and 13 had rightly been awarded the amount of Rs. 5,00,000/- by the Tribunal on account of being unnecessarily dragged in the main petition in which stay was also operating against them in respect of the plot in question which is stated to have been purchased by them lawfully as alleged.

Thus, in our considered opinion, there is no error in the approach of the Tribunal in so far as direction in Para 8(4) granted in the impugned order, which does not call for any interference by this Court and hence, the present appeal is hereby dismissed without any order as to costs.