AI Structured Summary
Not yet generated for this judgment
Judgment
ORDER
This is an application for condonation of delay in refiling the Appeal. It is the submission of the learned Counsel for the Appellant there is 48 days delay in refiling the present Appeal. The reasons for delay are mentioned in para – 3 to 5 of the application.
Considering the submissions made, the I.A. No.2683 of 2024 is allowed and delay stands condoned.
I.A. No.2683 of 2024 stands disposed of.
I.A. No.2852 of 2024
The Application for exemption is allowed.
The I.A. No.2852 of 2024 stands disposed of.
APPEAL
The present appeal is preferred by the appellant, Mr. Sunil Gulati, Promoter Director and Shareholder of M/s Alag Intco Hotels Pvt Ltd against the order dated 04.12.2023 in Company application No.271/ND/2022 filed by the Respondent in Company Petition No.597/ND/2019 which was filed by the Appellant passed by the Adjudicating Authority, National Company Law Tribunal, Court V, New Delhi.
The appellant had filed an application having CP No.597/ND/2019 under Section 59 of the Companies Act, 2013 with Ld. NCLT with a prayer inter alia for rectification of register of members of the Respondent No.1 company.
The Respondents had challenged the petition on the ground of limitation and had filed an interlocutory application viz. Company application No.271/ND/2022 under section 433 of Companies Act, 2013 read with Order VII Rule 11 of the code of Civil Procedure, 1908 read with Rule 11 of the NCLT Rules 2016 with the Ld. NCLT.
The Ld. NCLT vide its order dated 04.12.2023 had allowed the said company application filed by the Respondents and had dismissed the Company Petition bearing CP No.597/ND/2019 with the following reasoning:-
“10.It is the settled principle of law that the limitation commences from the accrual of the cause of action i.e., from the date when the right to apply accrues. Therefore, keeping in view this settled principle of law, the right to apply, for the purpose of present case under Section 59 of the Companies Act, 2013, accrues when the alleged illegal allotment and transfer took place i.e. , in 1999 and 2008 respectively. The assertion that the limitation commences from the date when the right to apply accrues, is affirmed by the Hon ble Supreme Court in the case of Sabarmati Gas Ltd. Vs Shah Alloys Limited, (2023) 3 SCC 229, wherein, the Hon’ble Supreme Court has held as under:-
"38.The abovementioned positions settled with respect to Section 7 IBC will proprio vigore apply to Section 9 IBC. In short, as relates an application under Section 9 IBC, the date of coming into force of IBC viz. 01.12.2016 would not form the trigger point of limitation and the period of limitation for an application for initiating CIRP under Section 9 IBC would be three years from the date when the right to apply accrues as provided by Article 137 of the Limitation Act and further that the right to apply under the IBC would accrue on the date when default occurs and it is extendable only by application of Section 5 of the Limitation Act."
11.It is observed that the period of limitation starts from the date of accrual of cause of action and the cause of action accrues when the facts entitling the cause of action is brought to the knowledge of the Applicant. In the present case, the fact that the Annual Returns and Balance Sheet of the Respondent No. 1 Company was signed by the Petitioner himself being one of the two Directors of the Respondent No. 1 Company, is evident of the fact that he had knowledge of the shareholding status of the Company The subsequent contention by the Petitioner that the Petitioner being 12th pass from Hindi Medium was unaware of the alleged manipulation in shareholding pattern of the Company for 20 long years, does not help him. The Petitioner being the Director of the Company is responsible for the acts of the Company. Further, Section 166(2) and166(3) of the Companies Act, 2013 states that the Director must act in good faith and shall exercise due diligence in performance of his duties. Section 166(2) and 166(3) of the Companies Act, 2013 reads as under:
"Section 166: Duties of Directors
Xxxxx
(2)A director of a company shall act in good faith in order to promote the objects of the company for the benefit of its members as a whole, and in the best interests of the company, its employees, the shareholders, the community and for the protection of environment.
(3)A director of a company shall exercise his duties with due and reasonable care, skill and diligence and shall exercise independent judgment. "
Xxxxx
12.Therefore, without going into the merits of the case, we are of the view that the present Company Petition filed by the Petitioner is barred by limitation and is liable to be dismissed on this ground. 13. Resultantly, the present Company Application bearing CA No. 271/ND/2022 stands allowed and the Company Petition bearing CP No. 597 /ND/2019 being barred by limitation, stands dismissed. No orders to cost.”
Yet again before us the appellant has challenged the transfer of 25000 equity shares to the Respondent No.2 made on 01.11.2008 and allotment of 54,500 equity shares on 18.09.1999 and also transfer of such shares to Respondent No.3 on 01.11.2008 and further allotment of 28000 equity shares to Mr. Rajeev Ashopa, Ms Saroj Mittal and Ms Gyatri Mittal on 18.09.1999.
Admittedly the appellant had slept over the matter for 20 long years and once again had argued he could not take any action against his Chartered Accountant as the appellant believed him while signing the annual returns and infact had never inspected such financial statements. Further the appellant alleges to be 12th pass from Hindi Medium, was unware of the alleged manipulation in shareholding pattern of the Company for 20 long years. We are not inclined to accept such argument and it has been rightly dealt with by the Ld. NCLT. We being of the same view, does not intend to interfere with the reasoned order of the Ld. NCLT. The Appeal thus has no merit and accordingly it is dismissed.
Pending applications also are closed.