In a case pertaining to oppression and mismanagement, the respondents pleaded that the legal heirs of a deceased member whose name is still on the register of members are not entitled to apply before Tribunal, as only me
CS Executive · Company Law · PYQS · December 2018
In a case pertaining to oppression and mismanagement, the respondents pleaded that the legal heirs of a deceased member whose name is still on the register of members are not entitled to apply before Tribunal, as only member of the company can complain about oppression and mismanagement. Thus, legal heirs have no locus standi. Examine this argument in the light of decided cases.
Answer & Explanation:
According to section 241 of Companies Act, 2013 any member of the company may make an application to the tribunal for relief in cases of oppression or mismanagement under given circumstance. In Worldwide Agencies (P) Ltd. v. Margaret T. Desor (1990), it was decided that the legal representatives of a deceased member whose name is still on the register of members are entitled to file a petition under Sections 397 and 398 of the Companies Act, 1956, for relief against oppression or mismanagement. In the present case the abovementioned case is applicable, where the member has died and his name still exists in the register of members, the legal heirs are entitled to maintain the petition.
Topics: Prevention of Oppression and Mismanagement
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