SC sets aside NCLT order
COURT RULED THAT THE PROCEEDING BEFORE NCLT SHOULD NOT BE ENTERTAINED BECAUSE OF A PENDING CIVIL SUIT IN DELHI HIGH COURT
LUDHIANA: In yet another twist in the Oswal family feud, the Supreme Court (SC) set aside an order passed by the National Company Law Tribunal (NCLT) in favour of Pankaj Oswal in 2018.The apex court ruled that the company petition filed by Pankaj, son of business tycoon late Abhey Kumar Oswal, against his mother Aruna Oswal is an ‘afterthought’ and needs to be dropped.
In the order passed on July 6 (copy with HT), the SC held that the proceeding before the NCLT, Chandigarh, should not be entertained because of a pending civil suit, filed by Pankaj, in the Delhi high court (HC).
The court noted that the basis of the company petition is a claim of inherence, which cannot be decided by NCLT under the provisions of law.
The NCLT had issued an order in 2018 recognising that Pankaj, the eldest son of industrialist late Abhey Oswal, is entitled to the shares of listed companies that his father promoted-- Oswal Agro Mills Ltd and Oswal Greentech Limited. Setting aside this order, the SC allowed the appeals filed on behalf of Oswal Agro Mills Limited, Oswal Greentech Limited and Aruna.
The apex court held that filing of the company petition by Pankaj seeking waiver of the minimum eligibility criteria of 10% shareholding under the Companies Act is a “misconceived exercise”. It further held that Pankaj should have waited for the decision of the high court as his entitlement is under cloud of a pending civil suit.
The court labelled the attempt by Pankaj Oswal in filing the company petition, after choosing to avail the remedy of civil suit as
“nothing but an afterthought”.
The court noted that after the demise of Abhey Kumar Oswal, the shareholding was registered in the name of his widow Aruna on the basis of nomination. The court noted that regarding the said shares, the Delhi HC has passed a status-quo order on February 8, 2017, thus shares have to be held in Aruna’s name till the civil suit is finally decided.
At the NCLT earlier, Pankaj had filed a petition alleging mismanagement, misappropriation and related party transactions happening in his late father’s companies.
It was also alleged that after the sudden intestate (not having made a will before death) Abhey’s wife Aruna had arbitrarily taken control of both the companies, on the basis of nominations in her name. In February 2017, Pankaj had filed a petition in the Delhi HC, claiming that the other three heirs, his mother Aruna, younger brother Shailendra and sister Shalu Jindal, were attempting to oust him from the estate of his father.