Case Note & Summary
The appeal was filed by three members of a company challenging an order from the National Company Law Tribunal (NCLT) regarding the convening of an Extraordinary General Meeting (EGM). The background involved a dispute over the removal of certain directors from the board and a subsequent request by the first respondent to re-induct them. The appellants argued that the first respondent failed to demonstrate why it was impracticable to convene the meeting as per the Companies Act, 2013. The respondents contended that Section 100(4) does not preclude the invocation of Section 98 and that the board must comply with the requisition for a meeting. The court analyzed the legal framework surrounding the convening of meetings under the Companies Act, particularly focusing on the interpretation of Sections 98 and 100. It concluded that while a requisitioning member has the right to call a meeting, invoking tribunal powers under Section 98 requires proof of impracticability. The court found that the first respondent did not provide sufficient evidence to establish such impracticability, leading to the decision to set aside the NCLT's order and allow the appeal.
Headnote
A) Company Law - Extraordinary General Meeting - Invocation of Section 98 - Companies Act, 2013, Sections 98, 100 - The tribunal held that a requisitioning member's right to convene a meeting under Section 100(4) is absolute, while invoking Section 98 is qualified and requires proof of impracticability. The court emphasized that the tribunal should not interfere with internal management unless it is established that a meeting cannot be convened without intervention (Paras 6-10).
Issue of Consideration
Whether Section 100(4) provides an exclusive remedy for convening an Extraordinary General Meeting or if Section 98 can be invoked without exhausting Section 100(4).
Final Decision
The order of the learned Adjudicating Authority in CP/04/KOB/2026 was set aside, and the appeal was allowed. Interlocutory applications, if any, would stand closed. No costs.
Law Points
- Companies Act
- 2013
- Section 98
- Section 100
- corporate governance
- internal management
- impracticability
