Interim reinstatement of a director cannot be granted based solely on ROC records without merit-based adjudication.

The Respondent No. 2 is a family company consisting of the Appellants and Respondent No. 1.

The Company passed a resolution removing Respondent No. 1 from his position as Director.

Aggrieved by this, Respondent No. 1 filed a petition under Sections 241 and 242 of the Companies Act, 2013, alleging oppression and mismanagement and seeking reinstatement.

While the Regional Director (RD) issued directions regarding charges against Respondent No. 1, the Registrar of Companies (ROC) refused to take cognizance of Form DIR-12 (the notice of removal), which led to Respondent No. 1 still being shown as a Director on the Ministry of Corporate Affairs (MCA) website.

On 10.03.2026, the Adjudicating Authority (NCLT) allowed an interim application (CA No. 158/2025), directing that Respondent No. 1 be considered a continuing Director until the final disposal of the main petition.

The Appellants challenged this interim order, arguing it effectively granted the final relief of status quo ante at a preliminary stage.

1. Whether the non-cognizance of Form DIR-12 by the ROC is sufficient grounds to declare the removal of a Director illegal or to grant an interim order for reinstatement.

2. Whether the Adjudicating Authority erred in granting an interim direction for the reinstatement of a Director without evaluating the substantive merits and legal arguments of the removal process.

Sections 241 and 242 of the Companies Act, 2013, which empower the Tribunal to address matters of oppression and mismanagement and grant interim reliefs.

The distinction between procedural filings with the ROC (Form DIR-12) and the substantive legality of a Director’s removal under the Companies Act.

The principle that interim orders should not generally grant the final relief (status quo ante) without a thorough examination of the balance of convenience and the merits of the case.

The NCLAT observed that the Adjudicating Authority’s impugned order relied almost exclusively on the procedural fact that the ROC had not taken cognizance of Form DIR-12 and that Respondent No. 1 remained listed as a Director on the MCA website.

The Appellate Tribunal noted that the NCLT failed to advert to other substantive submissions regarding the legality of the meeting or the validity of the removal under the provisions of the Companies Act, 2013.

The NCLAT emphasized that procedural issues regarding DIR-12 filings do not automatically render a removal illegal or determine the merits of a Section 241/242 petition.

Consequently, the NCLAT found that the Adjudicating Authority had not properly adjudicated the competing claims before granting an interim reinstatement that altered the company's management.

The Tribunal refrained from expressing any opinion on the merits of the removal but held that the application needed to be heard afresh.

The NCLAT revived CA No. 158/2025 before the NCLT and directed the Adjudicating Authority to decide the application expeditiously after hearing both parties.

The appeal was disposed of accordingly.