Disqualification Of Directors – An Update

The Hon'ble High Court of Delhi in a recent judgment dated November 04, 2019 in the matter of Mukut Pathak & Ors. vs. Union of India and Anr. [W.P.(C) 9088/2018 & CM Appln. No. 35006/2018] interpreted the provisions of Section 164(2) of the Companies Act, 2013 ("CA 2013") in detail including disqualification of directors, retrospective applicability of the section and applicability of principles of natural justice and discussed its consequent repercussions under Section 167(1) of the CA 2013.

Facts:

The Petitioners in the present case were directors in various companies who were disqualified under clause (a) of Section 164(2) of CA 2013 for default on the part of the concerned companies in filing the annual returns and financial statements for the financial years 2013-2014, 2014-2015 and 2015-2016 vide a list published by the Registrar of Companies on September 15, 2017 ("Impugned List"). The Petitioners, by virtue of the Impugned List, have been disqualified from