Summary and Analysis of Shailaja Krishna vs Satori Global Limited & Ors 2025 INSC 1065

1. Heading of the Judgment
Mrs. Shailaja Krishna vs. Satori Global Limited & Ors.
Civil Appeal Nos. 6377–6378 of 2023
Supreme Court of India
Decided on September 2, 2025
Bench: Justices Dipankar Datta and K. Vinod Chandran

Citation: Mrs. Shailaja Krishna vs. Satori Global Limited & Ors., 2025 INSC 1065 (Supreme Court of India).

2. Related Laws and Sections

• Sections 397 & 398 of the Companies Act, 1956 (Oppression and Mismanagement)

• Section 399 of the Companies Act, 1956 (Eligibility to file petition)

• Section 108(1A) & (1D) of the Companies Act, 1956 (Share transfer formalities)

• Section 286 of the Companies Act, 1956 (Notice for Board meetings)

• Section 193 of the Companies Act, 1956 (Minutes of meetings)

• Sections 31 & 34 of the Specific Relief Act, 1963 (Cancellation of instruments)

• Articles of Association (AoA) of the company (Internal regulations)

3. Basic Judgment Details
The appellant, Mrs. Shailaja Krishna, was the majority shareholder (98%) and a director of Satori Global Limited (formerly Sargam Exim Pvt. Ltd.). She alleged that her shares were fraudulently transferred to her mother-in-law (fourth respondent) via a gift deed dated December 17, 2010, and that she was forcibly removed from the company’s management. The National Company Law Tribunal (NCLT) allowed her petition under Sections 397 and 398 of the Companies Act, 1956, and restored her shares and directorship. The National Company Law Appellate Tribunal (NCLAT) reversed this decision, holding that the NCLT lacked jurisdiction to decide issues of fraud and coercion. The appellant appealed to the Supreme Court.

4. Explanation of the Judgment

The Supreme Court allowed the appeals, set aside the NCLAT’s judgment, and restored the NCLT’s order. The Court held that the NCLT had jurisdiction to decide on the validity of the gift deed and share transfers as they were central to the allegations of oppression and mismanagement.

Key Points of the Judgment:

• Maintainability of Petition:
  The Court held that the company petition under Sections 397 and 398 of the Companies Act, 1956, was maintainable. The appellant was a member of the company at all material times, and the fraudulent transfer of shares did not divest her of her membership rights.

• Jurisdiction of NCLT:
  The Supreme Court reaffirmed that the NCLT has wide powers to address all issues incidental to oppression and mismanagement, including fraud and coercion. It rejected the argument that such matters must only be decided by a civil court.

• Invalidity of Gift Deed and Share Transfer:
  The gift deed was invalid as it violated Clause 16 of the Articles of Association, which did not permit gift transfers to a mother-in-law.
  The share transfer forms were executed after their validity had expired and contained overwriting and date mismatches, rendering them void.
  The circumstances surrounding the gift deed were suspicious, especially since the fourth respondent had filed a criminal complaint against the appellant on the same date.

• Invalidity of Board Meetings:
  The board meetings held on December 15 and 17, 2010, were invalid due to lack of proper notice and quorum.
  Notice was not served to the appellant as required under the AoA and the Companies Act.
  The induction of the fifth respondent as a director was illegal, and his presence could not validate the quorum.

• Oppression and Mismanagement:
  The Court found that the series of actions—fraudulent share transfer, invalid board meetings, and removal of the appellant from directorship—collectively constituted oppression and mismanagement under company law.

• Restoration of NCLT Order:
  The Supreme Court restored the NCLT’s order, which had reinstated the appellant as a director and shareholder and declared the gift deed and share transfer null and void.

5. Conclusion
The Supreme Court held that the NCLT rightly exercised its jurisdiction to remedy the oppression and mismanagement faced by the appellant. The NCLAT erred in reversing the NCLT’s order on jurisdictional grounds. The appeals were allowed, and the NCLT’s order was restored.