NCLT Mumbai Allows Legal Heir to Continue Oppression Petition, Grants Inspection Rights Without Membership Entry

April 7, 2026 : The National Company Law Tribunal (NCLT), Mumbai Bench, has held that a legal representative of a deceased shareholder can continue proceedings under Sections 241 and 242 of the Companies Act, 2013, even without being formally registered as a member of the company.

In Anjum Karmali (Khandelwal) v. Ahmed A Fazelbhoy Private Limited & Ors., the Tribunal clarified that upon the death of a shareholder, their estate vests in legal heirs, who are entitled to step into the shoes of the deceased for pursuing oppression and mismanagement claims.

The Bench comprising Judicial Member Nilesh Sharma and Technical Member Charanjeet Singh Gulati was dealing with an application filed by the daughter of the original petitioner, who was substituted during the pendency of proceedings following her mother’s demise. The application sought interim reliefs including inspection of statutory records, verification of shareholding, and directions relating to a proposed buyout.

The respondents challenged the maintainability of the application, arguing that the applicant lacked locus standi since she was not a registered shareholder and that issues relating to transmission of shares must first be adjudicated under Sections 58 and 59 of the Act.

Rejecting these objections, the Tribunal relied on the appellate ruling in Ambadi Investments Ltd. v. Valli Arunachalam, holding that legal representatives can be impleaded in proceedings under Sections 241 and 242 even if they are not members of the company. It emphasized that there is no statutory requirement mandating prior registration as a member for continuation of such proceedings.

The Tribunal further noted that the original petitioner had, during her lifetime, taken steps including execution of Form SH-4 in favour of the applicant, and that disputes relating to succession or title do not extinguish ongoing proceedings.

On merits, the Bench held that the applicant had sufficient locus to seek reliefs incidental to the main petition. It observed that inspection of the register of members was directly connected to determining the shareholding pattern, particularly in light of a proposed buyout and alleged discrepancies in shareholding.

Referring to Section 171 of the Companies Act, 2013, the Tribunal reiterated that members have a statutory right to inspect company records and held that permitting inspection in the present case was justified to facilitate adjudication of the main dispute.

Accordingly, the Tribunal allowed the application in part and directed the respondents to grant access to the register of members maintained under Sections 88 and 170 of the Act and permit inspection in accordance with law.

However, it declined to grant additional reliefs such as production of original share certificates and appointment of a commissioner, observing that such directions were unnecessary once inspection of statutory registers was permitted.

The application was thus disposed of with limited relief, reinforcing the principle that legal heirs can effectively pursue oppression and mismanagement proceedings without procedural hurdles relating to formal membership.