Ms Megha Bangalore Rajashekara vs. Srs Travels And Logistics Private Limited

Held

The Court directed the National Company Law Tribunal (NCLT), Bengaluru, to dispose of the petitioner's application for selling the assets/buses belonging to the first respondent (SRS Travels and Logistics Private Limited) in accordance with the law within a period of one week from the date of the order. The Court found it expedient to dispose of the writ petition by issuing this direction, addressing the petitioner's grievance that her application had not been considered. The reasoning is based on the urgency expressed by the petitioner to utilize the sale proceeds for loan repayment and to protect her personal assets. The ratio decidendi is that when an application filed before a tribunal, crucial for financial management and asset protection, remains unaddressed, the High Court, under its writ jurisdiction, can direct expeditious disposal to prevent potential prejudice.

Facts

The petitioner, Ms. Megha Bangalore Rajashekara, holds 99.99% shareholding in respondent No. 1, SRS Travels and Logistics Private Limited, and is a guarantor for its loans. Respondent No. 2 is the Director of the company. The petitioner initiated proceedings before the National Company Law Tribunal (NCLT) under Section 242 of the Companies Act, 2013, in CP No. 90/2024. The NCLT, by an order dated October 16, 2024, restrained the petitioner from alienating the company's assets. The petitioner then filed an application before the NCLT seeking permission to sell the company's assets (buses) to repay loans, protect her personal properties from lenders' claims, and prevent the dissolution of respondent No. 2's assets. The petitioner's grievance is that this application has not been considered by the NCLT.

Key Issues

1. Whether the National Company Law Tribunal (NCLT) should be directed to expeditiously consider and dispose of the petitioner's application for the sale of assets of respondent No. 1, in light of the pending proceedings under Section 242 of the Companies Act, 2013? Petitioner's Contention: The petitioner argued that an urgent disposal of her application to sell the company's assets is necessary to utilize sale proceeds for loan repayment, shield her personal properties from lenders' claims, and prevent the indiscriminate dissolution of assets. She further alleged that the respondent No. 2, the Director, has breached his fiduciary duties. The petitioner seeks a direction for the NCLT to consider this application without delay. Revenue/State's Contention: No specific arguments were recorded for the revenue or state in the judgment.