Neeraj Gautam & Anr v. S P Bansal

SUDERSHAN KUMAR MISRA, J. FEBRUARY 04, 2014 rd

* IN THE HIGH COURT OF DELHI AT NEW DELHI + CONT.CAS(C) 716/2012 & CM APPL. 2275/2014 NEERAJ GAUTAM & ANR ....Petitioners Through: Mr. Tanuj Khurana, Mr. Gaurav Malik & Mr. Sumit Verma, Advocates versus S P BANSAL ....Respondent Through: Mr. J.S. Bakshi & Mr. Amitesh Singh Bakshi, Advocates CORAM: HON'BLE MR. JUSTICE SUDERSHAN KUMAR MISRA % SUDERSHAN KUMAR MISRA (ORAL) 1. The Delhi and District Cricket Association (DDCA) is a section 25 company as enunciated under the Companies Act, 1956 and has been incorporated under the same. The DDCA is a not for profit organisation that works for the promotion of the sport of cricket. As per the Articles of Association of the DDCA, the General Secretary is part of the Executive committee. As per clause 40 of the Articles of Association, the General Secretary can hold office till the conclusion of the Annual General Meeting held subsequent to the next succeeding Annual General Meeting. The eligible members are to elect the General Secretary at every alternate AGM. Furthermore, the General Secretary is also eligible for re-election, subject to the provisions of the Companies Act. 2. This contempt petition has been filed against Mr. S.P. Bansal, who is the General Secretary, Delhi and District Cricket Association (DDCA). It is being pressed by counsel for the petitioners under the following circumstances:- (a) On 18.12.2007, a common decision was rendered by this Court in CS No. 1288/2005 and CS No. 1550/2005. In paragraph 2 of that judgment, it was noted that the disputes inter se the parties, "can be set at rest by directing that the Annual General Meeting (AGM) be called forthwith". It was also noted that since there has been a lot of acrimony on both sides, therefore, it is necessary that the election be conducted by an independent person; and therefore, the Court also appointed an Election Officer and a Secretary to the Election Officer to conduct the elections then due. (b) In paragraph 7 of the aforesaid order, it was also stated as follows: "7. It is made clear and the parties have understood it clearly that the letter and spirit of the Memorandum and Articles of Association of the DDCA shall be complied with in future and the AGMs will be held as per rules." The suits were finally disposed off on the aforesaid terms. 3. The grievance now is that even though the AGM for the year in question at the time when the judgment was rendered, as well as the succeeding AGMs, were duly held; however, the AGM for the year 2012- 2013, which was to be held on or before 30.09.2012 in terms of Section 166 and 210 of the Companies Act, 1956, was only held much later, on 21.12.2012; and that this delay in holding that AGM amounts to contempt. In substance, counsel for the petitioners contends that the aforesaid expression of this Court, as reproduced above, constitutes a binding direction to the Delhi and District Cricket Association for all times to come, to hold the AGM strictly within the time contemplated in Section 166 and 210 of the Companies Act, and any delay in holding it would automatically amount to contempt. 4. In this context, an application dated 03.09.2012, was also moved by the Company before the Registrar of Companies under Section 166 of that Act, seeking extension of one month, which was duly granted. Consequently, the AGM was then to be held on or before 30.10.2012. However, this was not done, and the AGM in question ultimately came to be held on 21.12.2012. Thereafter, the respondent is stated to have filed a compounding application before the Registrar of Companies for the late holding of the AGM. Admittedly, this compounding application was allowed by the Company Law Board by its order dated 07.01.2014, whereby the Board also imposed a fine of Rs. 85,000/-, which has been duly paid. 5. To my mind, ex facie, the interpretation sought to be placed on the aforesaid order of 18.12.2007 by counsel for the petitioner doesn't commend itself. What has been said is that, "... the letter