The Supreme Court of India recently dismissed an appeal filed by Durgapur Bio Garden Pvt Ltd & Others challenging the judgment of the National Company Law Appellate Tribunal (NCLAT) dated 03.11.2017. This case arose out of allegations made by the respondents regarding oppression and mismanagement by the appellants.
Background of the Dispute
The case began when the respondents filed a petition in 2015 before the Company Law Board (now NCLT), Kolkata Bench. They claimed that the appellants had manipulated their resignation letters and falsely transferred shares without their consent.
However, in 2017, the NCLT dismissed the petition citing delay and laches, pointing out that the alleged transfer took place in 2007, but the petition was filed only in 2015. The tribunal also ruled that the share transfer was valid.
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The respondents challenged the NCLT's order in the NCLAT, which reversed the decision.
“We do not find any substance in the arguments of the Respondents that there was delay in filing of the petition... The NCLT misread the petition to claim that it was barred by limitation.” – NCLAT Observation
The NCLAT found the following irregularities in the share transfer process:
- The share transfer form lacked essential details like the name of the company, number of shares, share certificate number, and was not stamped as required under the Indian Stamp Act.
- Contradictions in documents: Resignation letters were dated March 2007, but cheques for consideration were allegedly issued in November 2007.
- Company’s own filings showed the appellants as directors till 2012.
- One director, appointed in 2008, had signed reports dated prior to his appointment.
- Misuse of signatures allegedly taken for bank settlement purposes.
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“Respondents are unlawfully keeping out the appellants and depriving them of their right to participate in the company.” – NCLAT Finding
The Supreme Court agreed with the NCLAT’s detailed findings and dismissed the appeal, stating:
“We are of the opinion that the findings of fact arrived at by the NCLAT are unimpeachable. The Company Law Tribunal has not made any error in fact or law.”
The Court thus affirmed the NCLAT’s ruling and closed all pending applications.
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- Appeal dismissed
- NCLAT order upheld
- No costs awarded
Case Title: Durgapur Bio Garden Pvt. Ltd. & Others vs. Nirakar Dash & Others
Case Type: Civil Appeal
Civil Appeal No.: 3298 of 2018
Judgment Date: 30 July 2025