On Friday, the Supreme Court issued an order directing Justice Ashok Bhushan, the chairperson of the National Company Law Appellate Tribunal (NCLAT), to conduct an inquiry into the allegations that a particular NCLAT bench had contravened the orders of the Supreme Court.
The directive was issued by a bench of the Supreme Court, comprising Chief Justice of India DY Chandrachud and Justices JB Pardiwala and Manoj Misra.
This action was taken after they were informed that, despite a previous order from the Supreme Court instructing the National Company Law Appellate Tribunal (NCLAT) to postpone the pronouncement of a verdict, the NCLAT went ahead and issued an order in disregard of the Supreme Court's instructions.
We direct that an enquiry shall be conducted on the above allegations by the Chairperson of the NCLAT.'' , the Supreme Court said.
The case in question revolved around the Annual General Meeting (AGM) of Finolex Cables. Previously, the National Company Law Appellate Tribunal (NCLAT) had issued an order that imposed a status quo on the AGM's results. This order was made while the NCLAT was in the process of adjudicating on a dispute between cousins Prakash Chabria and Deepak Chabria.
Earlier, the Supreme Court set aside this status quo order but also said that important decisions such as appointment of executive chairperson will be subject to the outcome of the litigation at NCLAT.
In the subsequent hearing of the case on Friday, during the morning session, the Supreme Court issued an order instructing the National Company Law Appellate Tribunal (NCLAT) to postpone the announcement of its order. This postpone was to remain in effect until the results of the Annual General Meeting (AGM) were submitted in the form of a report by the scrutinizer.
However, it was alleged that the NCLAT bench consisting of Rakesh Kumar and Dr. Alok Srivastava proceeded to issue its order in defiance of the Supreme Court's explicit directive.
Pursuant to that, the counsel for the appellant mentioned the matter before the Supreme Court in the afternoon session.
In response to this grievance, the Court ordered an investigation to be carried out by the chairperson of the National Company Law Appellate Tribunal (NCLAT) to examine the alleged defiance of its directive.
The matter will be heard again on October 17.
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