The National Company Law Tribunal (NCLT) Hyderabad bench has ordered Emaar Hills Township Private Limited (EHTPL) to compensate the financial losses incurred by both the Government of Telangana and the Telangana State Industrial Infrastructure Corporation (TSIIC) till date with regard to equity dilution and other such consequences in the project.
The NCLT bench comprising judicial member Bhaskara Pantula Mohan and technical member Binod Kumar Sinha passed the order on Monday on a plea filed by TSIIC, alleging mismanagement in EHTPL, leading to substantial loss of revenue to the petitioner, thereby adversely impacting the public interest at large. TSIIC had blamed EHTPL’s Emaar principals for the mismanagement.
The bench issued notice to EHTPL and other respondents seeking their reply within four weeks on a petition filed by the Government of Telangana under the Companies Act, 2013.
With Emaar questioning the locus standi of the TSIIC since it had not entered into an agreement with it, the NCLT held that TSIIC has the locus standi post the bifurcation of erstwhile united Andhra Pradesh to pursue the company petition in the public interest.
The Additional Advocate General appearing for TSIIC also urged that by virtue of Section 53 of AP Reorganisation Act, 2014, there is no need for transmission of shares and TSIIC has automatically, by operation of law, become the owner of shares held by APIIC by virtue of AP State Reorganisation Act, 2014.
The NCLT held Emaar Hllls Township Private Limited is bound to file its counter in reply to the contentions raised by TSIIC in the main company petition.
The bench also barred Emaar Properties Dubai and Emaar Holdings or its directors from trying to transfer or dispose or create third party interest in the assets and properties of EHTPL.
The respondent companies have been directed to filed their counter within four weeks when the company petition will be taken up on August 26.
Read the full order here:
NCLT-order-1