Unitech: “Manner in which order has been passed by NCLT very disturbing”, SC

The Supreme Court today made some strong remarks with regard to last week’s order of the National Company Law Tribunal (NCLT) that had allowed the Ministry of Corporate Affairs (MCA) to appoint ten nominee directors to take over the management of Unitech Ltd.

Chief Justice of India Dipak Misra remarked in today’s hearing,

“Leave should have been taken from us. The manner in which the order has been passed is very very disturbing.”

This observation by the Bench also comprising Justices AM Khanwilkar and DY Chandrachud, was in tune with the submission made by Senior Advocate Mukul Rohatgi, who appeared for Unitech.

“I have a grievance against the manner in which order has been passed by NCLT.

No notice was given to us. We did not even know. My friend Mr. Kumar had to rush to NCLT, still they refused to modify the order. No judicial tribunal can pass such an order.

You take over a company in a single stroke without hearing us. The entire Board has been removed. That Board is answerable to this Court.”

ASG Tushar Mehta, appearing for the Centre, started his submissions by stating that,

“I cannot outshout my friend.”

Mehta sought time till tomorrow to take instructions.

The Court then adjourned the matter for tomorrow.

The NCLT Bench headed by Justice MM Kumar had passed orders on Friday morning, allowing the Ministry of Corporate Affairs (MCA) to appoint ten nominee directors to take over the management of Unitech Ltd, subject to the directions of the Tribunal.

Later that afternoon, Unitech approached the NCLT seeking that the order be kept in abeyance, relying on a Supreme Court order passed in September prohibiting coercive action against the company. However, the NCLT Bench refused to change its stance, noting that its order would be subject to the Supreme Court order on which reliance was placed.