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‘Disgruntled’ members trying to destabilise us: Delhi Gymkhana club on govt plea to take over

The club sought the dismissal of the Ministry of Corporate Affairs’ plea to take over the club before the National Company Law Tribunal, which reserved its order.

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New Delhi: “Disgruntled members”, who lost elections, and applicants, who were denied membership, including a former high-ranking official of the Ministry of Corporate Affairs (MCA), are trying to destabilise one of the oldest clubs.

The Delhi Gymkhana Club said this Tuesday to the National Company Law Tribunal (NCLAT) in response to an MCA petition filed last month, seeking the prestigious club’s management control. 

The club refuted the MCA’s allegations that its affairs are being mismanaged by the general committee and sought the dismissal of the petition. The NCLAT has reserved its order.

The MCA had moved an urgent petition before the NCLAT to take over the club on the ground there was “fraudulent and rampant mismanagement” by its general committee, among others. It sought to take over the management control under the Companies Act, 2003.


Also read: Clash of the titans: It’s true Lutyens’ elite vs Modi govt over Delhi Gymkhana management


MCA’s letter a ‘lazy’ work 

The club has named a former MCA official, Navrang Saini, and some of the “disgruntled members” in its response and said it is facing the heat from the MCA after it denied him membership, according to Gymkhana’s written submissions filed by advocate Gaurav Liberhan.

The club also termed an MCA letter, which was sent to the higher authorities within the ministry recommending the filling of the petition, a “lazy” job.

The letter by MCA’s regional director, North, on 4 March was without any application of mind and not in public interest — the two conditions required under the Companies Act to file a petition for controlling the management of a company.

The letter, Gymkhana said, was issued after a complaint was sent by Saini to the MCA claiming mismanagement of the club’s affairs.

“The letter dated March 4, 2020 only refers to the cut and paste job with a notation ‘I agree’. ‘I agree’ does not reflect application of mind. In fact, it reflects a complete non-application of mind. ‘I agree’ is only a conclusion and a very lazy one at that and conclusions that do not constitute reasons,” the club submissions stated.

MCA failed to establish fraud

The MCA repeated the word ‘fraud’ several times in its petition, yet it failed to establish fraud, Gymkhana said.

“Fraud must be specifically pleaded, and the manner of the fraud has to be specifically brought out in the pleadings. This allegation is bereft of pleadings and even otherwise there is no fraud,” it said, adding that it is a company by the members and for the members.

Allegations of fraud mentioned in the MCA’s petition relate to a period prior to the present general committee’s election, added the club.

An outsider to the company, even otherwise, had neither any locus nor any right to interfere in the internal management of the company, the club stated. 

The MCA has failed to establish what is the public interest involved and how the affairs of the company are being run prejudicial to public interest, it added.

“The club functions in terms of its objects and there is absolutely no misuse of the land for which it holds a perpetual lease under a valid document,” argued the club.

On the issue of refund of applicants’ money raised in the petition, the club clarified it can be done on demand.

However, since the money is given voluntarily by the applicants without any promise of time for grant of membership, the question of payment of interest does not arise, it said.


Also read: Why the lack of approval from Lutyens’ Delhi bothers Narendra Modi so much


 

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