Major Atul Dev Retd & Ors vs Union Of India Mca & Ors

Headnote AI-drafted · Editorially reviewed

These two appeals were filed before the National Company Law Appellate Tribunal challenging the order dated 1st April 2022 passed by the National Company Law Tribunal, Principal Bench in petitions under Sections 241-242 of the Companies Act, 2013. The impugned order had allowed a petition filed by the Union of India permitting it to nominate 15 persons as Directors on the General Committee of Delhi Gymkhana Club Limited to manage the affairs of the Company. The appellants, being members of the Delhi Gymkhana Club Limited who had been permitted to intervene in the original proceedings, felt aggrieved by the said order and filed these appeals.

The background to the matter involved an inspection of Delhi Gymkhana Club Limited ordered by the Ministry of Corporate Affairs under Section 206(4) of the Companies Act, 2013, conducted between January 2019 and July 2019. The inspection report and a subsequent supplementary report revealed several instances of mismanagement and violations of the Companies Act, 2013, and the Company's Memorandum and Articles of Association. Consequent upon the inspection findings, the Union of India filed a petition under Sections 241-242 of the Companies Act, 2013 on 22nd April 2020, leading to the NCLT's impugned order directing nomination of 15 government-nominated Directors to the General Committee.

The Appellate Tribunal considered the submissions and the background, including earlier proceedings before this Tribunal and directions given by the Supreme Court. The appeals were dismissed, upholding the NCLT's direction permitting the Central Government to nominate 15 Directors to the General Committee of Delhi Gymkhana Club Limited, with directions to file periodic reports with the Tribunal and take corrective measures for restructuring the Company in accordance with its Memorandum and Articles of Association and the Companies Act, 2013.

Catchwords: Delhi Gymkhana Club oppression and mismanagement Section 241-242 Companies Act 2013 nomination of directors by Central Government Section 8 company inspection under Section 206(4) NCLT NCLAT company limited by guarantee government intervention club management member rights