For Cases admitted by NCLT all proceeding should be concluded by NCLT only

Shriraj Investment and Finance Ltd. & Ors. Vs Union of India & Anr. (Delhi High Court)

Delhi HC: Where the case has been admitted in NCLT, all the contentions including power to initiate such proceeding should be raised before and concluded by NCLT only

Shriraj Investment Pvt. Ltd. (Petitioner No. 1) and Casper Consumer Electronics Pvt. Ltd. (Petitioner No. 2) filed two Petitions, on the similar lines, impugning the Letter dated June 29, 2016 and the Corrigendum issued on November 29, 2019 (“Impugned letters”) by the Union of India (Respondent No. 1) ordering the filing of complaints against the Petitioner No. 1 & 2 for the offences under the Companies Act, 2013 and further, the Respondent No. 1 issued directions to initiate proceedings under Section 241, 242 and 246 read with Section 339 of the Companies Act, 2013 (“the Companies Act”) before the National Company Law Tribunal (“the NCLT”).

In the case, the Petitioners contended that the Impugned letter calls for freezing and disgorgement of assets of 157 companies to be sold despite the fact such companies are functional. The Petitioners impugned the letter through the virtue of Section 212(14) of the Companies Act. Furthermore, the Petitioners argued that the officers of the Respondent No. 1 were obliged to go forth with scrutinizing the reports of the above companies, which apparently wasn’t done.

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