C. Valli Narayan Vs C. Krishniah Chetty & Sons Private Limited (NCLAT Delhi)
NCLAT Delhi held that NCLT erred by not enforcing valid Family Settlement Agreement since such agreement is binding and enforceable for resolving family company disputes which involves oppression and management.
Facts- The Appellant A1 claims to be an 80-year-old oppressed member, shareholder and a non-whole-time Director of the R-1 Company (which has historically been a family run business. Since its inception, the R-1 Company has been managed like a quasi-partnership.R-1 acquired the assets and liabilities of a dissolved partnership firm in 1980 called C. Krishniah Chetty & Sons. The Appellant group (the Appellant and her son, R9) holds 50% shareholding of the R1 Company and the remaining 50% is held by R 2-7 group. Despite having equal shareholding as the R 2-7 group, the Appellant group has been illegally excluded from the affairs of R1 Company by the R2-7 group, such an exclusion is on the face of it oppressive and is detrimental to the rights of the Appellant group as the equal shareholders. Notably, Appellant claims that in the impugned order dated 24.01.2019, not only did the NCLT fail to consider such an exclusion and oppression of the Appellant group or adjudicate upon it, but also failed to give effect to the Family Settlement arrived at between the parties and resolve the admitted deadlock.
