March 11, 2021 1:58:34 am
Directors of Delhi Gymkhana Club have approached Supreme Court against the February 15, 2021 order of the National Company Law Appellate Tribunal (NCLAT), New Delhi, Principal Bench, suspending its elected General Committee (GC) and handing over the administration to a central government nominee.
The NCLAT order granting the interim relief came on appeals filed by the Centre and the club management against a June 26, 2020 order of the National Company Law Tribunal (NCLT) which — acting on a company petition by the Centre (under the Companies Act) alleging that the affairs of the Club were being run in a manner prejudicial to public interest — had directed inclusion of two nominees of the government in the GC. The Centre appealed against this before the NCLAT saying the relief was inadequate. The club also appealed for setting aside the NCLT order.
In its fresh appeal before the SC, the club said one of the prime requirements for filing a company petition was an “opinion” given by the government. However, there was no such valid opinion on record, it said, adding that the appellate tribunal had ignored this aspect.
The Directors said that “the instant case is a complete abuse of the powers envisaged under… the (Companies) Act and if not intervened in by” the court, “would set a completely wrong and dangerous precedent whereby the government would be able to interfere with the functioning of any company on the alleged ground of public interest”.
The company petition was filed following an inspection ordered by the Ministry of Corporate Affairs in the wake of complaints against the club management. The club maintained these were “misconceived complaints” by “some disgruntled members and applicants”.
According to the case by the Centre before NCLT, “the club, which limited access only to the government officers and limited the number of non-governmental people, virtually barred entry of many people who applied for membership… even after waiting for decades as the children of permanent members managed to sneak in…. frustrating the desire of people on the wait list”.
The club denied that it induced prospective applicants to pay higher membership fees despite being aware of the limited number of vacancies.
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