Disqualification of Vellappally Natesan: Kerala HC orders status quo in SNDP Yogam board

Kochi: High court has ordered the maintenance of status quo regarding the present composition of the board of directors of the SNDP Yogam until further orders. This will in effect restrain the state govt from appointing the required number of directors until new directors are appointed by the company in a general meeting, in accordance with a single bench order.The order by a bench of Chief Justice Soumen Sen and Justice V M Syam Kumar came in response to appeals filed by SNDP Yogam general secretary Vellappally Natesan and others, challenging the single bench order that had disqualified them from holding posts in the Yogam and declared their offices vacant for violations of the Companies Act, 2013. The division bench further adjourned the appeals filed by Natesan, along with his son Thushar (vice-president of the Yogam), M N Soman (president) and Arayakkandil Santhosh (devaswom secretary), to March 24.The single bench had disqualified all board members who did not possess a director identification number (DIN), as mandated under Section 152(3) of the Companies Act. It also noted that SNDP Yogam had failed to file annual accounts and returns from 2006-07 to 2016-17 until Sept 2020, thereby attracting disqualification under Section 164(2) of the Act, which applies when a company fails to file financial statements or annual returns for three consecutive years.In their appeals, Natesan and others contended that disputes relating to the disqualification of directors and the internal management of a company fall within the jurisdiction of the National Company Law Tribunal (NCLT). They further argued that Section 430 of the Companies Act expressly bars the jurisdiction of civil courts and other forums in matters that the tribunal is empowered to determine.