Kochi, March 16 Former SNDP Yogam general secretary Vellappally Natesan and his son Thushar Vellappally filed appeals on Monday challenging a Kerala High Court single bench ruling that disqualified all the office bearers and the entire Board of Directors of the organisation over alleged non-compliance with statutory requirements under the Companies Act.
Earlier, Justice T R Ravi had passed the order on a batch of petitions, including one filed by the late professor M K Sanoo, alleging irregularities in the functioning of the organisation.
Apart from Natesan, the court had also disqualified Thushar Vellappally, M N Soman, and Santhosh, also known as Arayakkandil Santhosh, from the organisation’s Board of Directors.
Sree Narayana Dharma Paripalana (SNDP) Yogam is a prominent socio-cultural organization representing the Ezhava community in Kerala.
In their appeal, the petitioners contended that the judgment suffered from serious jurisdictional errors and an incorrect interpretation of statutory provisions.
"The impugned judgment 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 Director Identification Number (DIN) and disqualification of directors," the petition said.
According to the petitioners, the impugned judgment dated March 12 is wholly without jurisdiction and should be set aside.
The petitioners further argued that the order was vitiated by serious factual errors regarding the organization's annual returns.
According to them, the single judge proceeded on the premise that the Yogam had failed to file its annual returns and, therefore, incurred disqualification under Section 164(2) of the Companies Act.
They submitted that, due to the organization's wider objectives, which extend beyond Kerala, returns had earlier been filed with the Registrar of Companies.
Later, following a Central government order dated August 23, 2005, declaring that the Kerala Non-Trading Companies Act was applicable to the organization, the returns were submitted to the Registrar General.
The petition stated that from 2006-07 onwards, the Yogam had been submitting annual returns and financial statements both to the Registrar General and the Registrar of Companies.
However, the appellants said these records could not be processed earlier because the organization’s registers and records had been kept in sealed custody with the Registrar (Judicial) of the High Court in connection with earlier litigation and were released only in 2019.
The petitioners, therefore, argued that the finding that returns were not filed for three consecutive financial years, which is necessary for invoking disqualification under Section 164(2) of the Companies Act, was unsustainable.
They also challenged the court’s finding regarding the Director Identification Number (DIN), stating that the appellants had produced valid DIN numbers issued by the Central government under the Companies Act.
According to the appeal, the single judge himself had recorded that the state government had not framed rules for issuing DIN numbers, yet the appellants were still declared disqualified on that ground.
Based on these findings, the single bench had declared that the appellants vacated office under Section 167(1)(a) of the Companies Act and directed the government to appoint directors under Section 167(3) to manage the affairs of the Yogam.
The petitioners contended that such directions fundamentally altered the organization's administration and could not have been issued in the writ jurisdiction, particularly since the issue of directors' disqualification falls within the jurisdiction of the National Company Law Tribunal.