Vellappally Natesan, son file appeal challenging HC order disqualifying them from holding posts in SNDP Yogam

General secretary of the Sree Narayana Dharma Paripalana (SNDP) Yogam Vellappally Natesan and its vice-president Tushar Vellappally have approached the Kerala High Court challenging its March 12 order disqualifying them from holding their posts in the organisation.

The High Court disqualified them from their posts following a finding that they acted in violation of the Companies Act, 2013, by failing to file audited accounts of the Yogam for three consecutive years. The court then went on to direct the appointment of a new board of directors in the Yogam.

The court passed the order on petitions filed by late literary critic M.K. Sanoo and others, all members of the Yogam, alleging non-submission of financial statements of the Yogam for three consecutive years. They had also challenged an order of the IG (Registration) which allowed the two office-bearers and M.N. Soman, president of the Yogam, to continue in their posts, despite the alleged non-submission of the statements.

In their appeal, Mr. Natesan and his son Tushar contended that by issuing an order disqualifying them, the court committed a fundamental jurisdictional error by issuing directions that affected the composition of the Board of Directors. The writ petitions were not maintainable since the dispute relates to alleged disqualification of directors and internal management of a company governed by the Companies Act, 2013. Such issues fall within the jurisdiction of the National Company Law Tribunal, and Section 430 of the Act expressly barred the jurisdiction of civil courts and other forums in matters which the Tribunal is empowered to determine.

They further referred to a ‘binding judgment’ of a Division Bench of the High Court in 2024 wherein it was held that the Yogam, being a private company, is not amenable to writ jurisdiction, and that disputes relating to its internal affairs must be resolved through statutory remedies under the company law. A Single Judge could thus not disregard a ‘binding’ Division Bench judgment, on the basis of a decision which itself stands stayed. The impugned judgment therefore violates settled principles of judicial discipline and precedent.

The impugned judgment is further vitiated by ‘serious factual errors’, the appellants said and contended that the Single Judge issued the order on the premise that the Yogam had failed to file annual returns and therefore incurred disqualification under the Companies Act. The materials on record clearly establish that the annual returns were filed within the extended time permitted by the authorities. Section 164(2) of the Act applies only in cases of non-filing of returns for three consecutive financial years and therefore the finding of disqualification is unsustainable, the appellants contended.

They further contested the Single Judge disqualifying them for among others, not possessing a Director Identification Number issued by the State government. The impugned judgment therefore suffers from serious jurisdictional error, failure to follow binding precedent, incorrect appreciation of facts relating to filing of returns and erroneous interpretation of the statutory provisions relating to DIN and the disqualification of directors of the Yogam, they submitted and sought that the March 12 order of the High Court be set aside.