Tata Sons v Cyrus Mistry : Live Updates From Supreme Court Hearing - Day 3

You need to show how NCLAT came to this conclusion that it was a fit case for winding up under the just and equitable clause., says  CJI

Bench will hear the matter next on Monday at 2 pm.

Sundaram is going over some judgements with the bench.

The conduct by which the company was made a private limited company shows that minority was being sidelined, Sundaram says

CJI : Where was the deadlock in Tata Sons, Mr. Sundaram? There was no deadlock.

Sundaram : Deadlock is not the sine qua non (for powers under Sec 241).

Sundaram referring to SC judgment in 'Hind Overseas Ltd v Raghunath Prasad Jhunjhunwalla' (1976)

CJI : The argument of Salve is that absent the conditions justifying winding up, the power under Sec 241 cannot be exercised.

Sundaram : I will deal with the argument both on facts and law.

Sundaram : The test would be, first come to the conclusion whether there is prejudice or oppression.

The second is whether the company should be allowed to function in such way with its acts of oppression and mismanagement. If there is such a conclusion, there will be just and equitable reasons to wind up the company and the powers under Section 241 can be invoked in the alternative.

Sundaram : It would be dependent on facts. The question is would it be fair and equitable to carry on the company in this fashion.

It is not necessary that the Act justify the winding up. The issue is whether it is equitable to let the company in such state of affairs.

CJI : Is the prejudice of such a degree that the winding up is justified?