NCLT has no jurisdiction over the matters which it is not empowered to, by the Companies Act, 2013

NCLT has no jurisdiction over the matters which it is not empowered to, by the Companies Act, 2013: Delhi High Court

According to Section 434(1)(c) of the Companies Act, 2013, All the cases pending in the District courts and High Courts to NCLT, provided that the NCLT has the jurisdiction of those cases under Section 241 of the Companies Act and has been barred under Section 430 of the Act. Using the same lines, the High Court of Delhi, in the case of Naresh Dayal v. Delhi Gymkhana Club Ltd., stated that if the National Company Law Tribunal has no power over the matter or cause of action, it would not be conferred the jurisdiction to decide on those matters.

In this case, seven plaintiffs, constituting the permanent members of the Delhi Gymkhana, filed a representative suit. In the suit, they stated that the Club was conferring “Green Card holder” status on certain category of persons though it was not provided for in its Articles of Association. According to the plaintiffs, the facility of the green card was not being extended to those children who did not enjoy the facilities of the Club as minors as no such condition was mentioned in the AOA. Thus, the Plaintiff prayed the hon’ble court to declare the be extended to the children of all the permanent members irrespective of their age and whether they had used the facilities of the Club or not as minors.

In reply to this, the Club questioned the maintainability of the suit and contended that the NCLT is the appropriate forum to file such suit for which the plaintiff countered by arguing the contrary.

The Court on gathering all the arguments and contentions, stated that the suit does not any oppression, misbehavior classification for accounts of the Club nor did it seek winding up or rectification of record. The plaintiffs are merely seeking equal treatment for all members after membership is granted and permanent injunction against those who are not the members but are enjoying the activities which are meant for only those members who are permanent.

This pleas and cause of action is outside the jurisdiction of the NCLT even if the Section 434(1)(c) is interpreted widely.