Indian Kanoon - Search engine for Indian Law

Delhi High Court - Orders

Snehal N Muzoomdar vs Union Of India & Anr on 4 May, 2023

Author: Satish Chandra Sharma

Bench: Chief Justice, Subramonium Prasad

                          $~56
                          *    IN THE HIGH COURT OF DELHI AT NEW DELHI
                          +    W.P.(C) 5842/2023
                               SNEHAL N MUZOOMDAR              ..... Petitioner
                                                      Through:     Mr. Shivam Shukla and Mr. Pranjit
                                                                   Bhattacharya, Advocates.

                                                      versus

                                 UNION OF INDIA & ANR.                                ..... Respondents
                                                      Through:     Ms. Shiva Lakshmi, CGSC with Mr.
                                                                   Prashant Rawat, G.P.

                                 CORAM:
                                 HON'BLE THE CHIEF JUSTICE
                                 HON'BLE MR. JUSTICE SUBRAMONIUM PRASAD
                                               ORDER

% 04.05.2023 CM APPLs. 22885-86/2023 (Exemption) Allowed, subject to all just exceptions. W.P.(C) 5842/2023 & CM APPL. 22884/2023

1. The Petitioner before this Court has filed the instant writ petition with the following prayers:

"I. Issue an appropriate writ m the nature of mandamus declaring the provisions of Section 132( 4) of the Companies Act, 2013 and Rules 10 and 11 of the NFRA Rules as arbitrary and ultra vires the provisions enshrined in Article 14, 19(1)(g) and 21 of the Constitution of India and therefore, deserve to be struck off as being unconstitutional.

II. Issue a writ, order or direction in the nature of certiorari quashing the proceedings contemplated and pending before the respondent no. 2 in pursuance of Signature Not Verified Digitally Signed W.P.(C) 5842/2023 Page 1 of 4 By:RAHUL SINGH Signing Date:06.05.2023 17:51:51 the illegal show cause notice dated 21.11.2022 passed without jurisdiction.

III. Issue a writ, order or direction in the nature of mandamus directing the respondent no. 2 not to take any action in pursuance of the illegal show cause notice dated 21.11.2022 and/or to pass any adverse order against the petitioner inflicting any penalty under the Companies Act, 2013.

IV. Issue a writ, order or direction in the nature of mandamus directing the respondent no. 2 not to pass and upload any orders on its website in pursuance of the illegal show cause notice dated 21.11.2022 and/or if passed, to be taken down.

V. Issue any other order, orders and / or direction, as this Hon'ble Court may deem fit and proper under the facts and circumstances of the case.

VI. Award the cost in favour of the Petitioner."

2. By way of the present petition, the Petitioner has challenged the constitutional validity of Section 132(4) of the Companies Act, 2013 and Rules 10 and 11 of the NFRA Rules.

3. The Petitioner has also prayed for an interim relief in the matter and to support his contention has placed reliance upon an Order dated 21.05.2020 passed by a Division Bench of this Court in W.P.(C) 1522/2020 etc.

4. This Court has carefully gone through the Order dated 21.05.2020 passed by the Division Bench of this Court. The said Order was passed by this Court when COVID-19 pandemic was in place and the persons therein were not able to file their detailed replies whereas in the present case, the Signature Not Verified Digitally Signed W.P.(C) 5842/2023 Page 2 of 4 By:RAHUL SINGH Signing Date:06.05.2023 17:51:51 Petitioner has already filed a detailed and exhaustive reply to the Show Cause Notice issued on 21.11.2022. The Apex Court in the case of Union of India v. Kunisetty Satyanarayana, (2006) 12 SCC 28 has held as under:

14. The reason why ordinarily a writ petition should not be entertained against a mere show-cause notice or charge-sheet is that at that stage the writ petition may be held to be premature. A mere charge-sheet or show-

cause notice does not give rise to any cause of action, because it does not amount to an adverse order which affects the rights of any party unless the same has been issued by a person having no jurisdiction to do so. It is quite possible that after considering the reply to the show-cause notice or after holding an enquiry the authority concerned may drop the proceedings and/or hold that the charges are not established. It is well settled that a writ petition lies when some right of any party is infringed. A mere show-cause notice or charge-sheet does not infringe the right of anyone. It is only when a final order imposing some punishment or otherwise adversely affecting a party is passed, that the said party can be said to have any grievance.

15. Writ jurisdiction is discretionary jurisdiction and hence such discretion under Article 226 should not ordinarily be exercised by quashing a show-cause notice or charge-sheet.

5. This Court, at this juncture, does not find any reason to stay the proceedings which are pending against the Petitioner. The authorities shall be free to pass a final Order in the matter in accordance with law.

6. Issue notice.

7. On taking steps, let notice be issued to the Respondent through all permissible modes, including Dasti.

8. As the Petitioner has raised the issue of constitutional validity, let a detailed reply be filed within six weeks.

9. List on 09.08.2023 SATISH CHANDRA SHARMA, CJ SUBRAMONIUM PRASAD, J MAY 04, 2023 S. Zakir Signature Not Verified Digitally Signed W.P.(C) 5842/2023 Page 4 of 4 By:RAHUL SINGH Signing Date:06.05.2023 17:51:51