Nominee Director Without Nominating Group Support Can’t Join Oppression & Mismanagement Petition | HC
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- Last Updated on 28 September, 2023
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Case Details: Priya Jain v. Laguna Holdings (P.) Ltd. - [2023] 154 taxmann.com 253 (HC-Delhi)
Judiciary and Counsel Details
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- Sanjeev Narula, J.
- Harish Malhotra, Sr. Advocate, Rajiv Bahl & Vikas Tomar, Advocates for the Appellant.
- Darpan Wadhwa, Sr. Adv., Ms Ruby Singh Ahuja, Varun Khanna, Akshay Aggrawal, Vasu Singh, Ms Megha Dugar, Ms Aditi Mohan, Ms Neelakshi Bhaduria & Sidharth Aggarwal, Advocates for the Respondent.
Facts of the Case
In the instant case, there were two groups of shareholders in respondent No. 3 company, ‘DKJ’ Group and SKG Group, each group holding 50% of the share capital. DKJ died and was survived by three daughters and one son. During the lifetime of DKJ, his youngest daughter, the appellant, was appointed in respondent No. 3, as a nominee director on behalf of DKJ Group.
However, after the death of DKJ, the DKJ group withdrew the nomination of the appellant finding that she had started acting against the interests of respondent no. 3. The shares held by the appellant were also transferred to the wife of late DKJ.
As the said shares were not registered in the register of members of respondent no. 3 company, DKJ Group filed a petition under sections 111, 397, 398, 399, 402 and 403 of the Companies Act, 2013 claiming that SKG Group had been engaging in acts of oppression and mismanagement concerning respondent No. 3.
Subsequently, the appellant filed an application seeking impleadment and requested permission to file a counter affidavit to oppose the petition. This request was turned down by the CLB holding that the appellant need not become a party to the petition.
High Court Held
The High Court held that since the appellant’s shareholding in respondent nos 3 company stood transferred in favour of DKJ Group and the appellant no longer had the support of the nominating group, the appellant could not be allowed to implead in a dispute that involved DKJ group’s pursuit to defend their representation rights in respondent no. 3 company.
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