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Mrs. Shailja Krishna vs Satori Global Limited & Ors.

Not available · 2025 INSC 1065Decided 2 Sept 2025
Not available
Justice Dipankar Datta · Justice K. Vinod Chandran

Background

The appellant, who held a 98% shareholding and was a director of a company (originally "Sargam Exim Private Limited," later renamed "Satori Global Limited"), filed a company petition alleging oppression and mismanagement under Sections 397 and 398 of the Companies Act, 1956. The National Company Law Tribunal (NCLT) ruled in her favour, but the National Company Law Appellate Tribunal (NCLAT) reversed that decision on appeal by the respondents.

Decision Breakdown

The Supreme Court examined board meetings held on 15.12.2010 and 17.12.2010, where the appellant's alleged resignation was purportedly accepted and another person was inducted as an additional director. It found both meetings lacked the mandatory quorum of at least two validly appointed directors under the company's Articles of Association: the appellant, holding the vast majority of shares, was absent, and the newly inducted director's appointment was itself invalid, so his presence could not cure the quorum defect. Concluding that the company's actions collectively demonstrated clear oppression and mismanagement prejudicial to the appellant, the Court held the NCLAT was wrong to interfere with the NCLT's findings, set aside the NCLAT's judgment, and restored the NCLT's order in the appellant's favour.

Lesson Learnt

Corporate decisions, including accepting a director's resignation or appointing a new director, are invalid if taken at a board meeting that lacks the minimum quorum required by the company's own constitutional documents, and majority shareholders cannot be sidelined through procedurally defective meetings.

Official source (sci.gov.in)View Judgment (PDF)

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