Mumbai: In a major win for shop-owning shareholders at South Mumbai’s iconic 130-year-old Swadeshi Market, the National Company Law Appellate Tribunal (NCLAT) on Thursday rejected an attempt by the incumbent board of directors to delay a court-mandated Annual General Meeting (AGM).
The AGM — crucial for electing a new board to oversee the market’s long-pending redevelopment — will now go ahead under the supervision of Justice S.J. Kathawalla (Retd.), who has directed that the meeting notice be issued immediately and that the AGM proceed as scheduled.
Swadeshi Market, home to over 600 textile and garment shops, operates as a company in which each shop owner holds shares. Under corporate governance principles, shareholders are entitled to elect their board at an AGM.
However, petitioning shareholders allege they have never had the opportunity to vote for directors in decades, with the incumbent board filling vacancies by appointing “additional directors” chosen by predecessors — a practice they say amounts to illegal capture of the board.
“All we want is people chosen by us to represent us in the redevelopment of this market,” said one shareholder, noting that the livelihoods of hundreds of retailers depend on fair representation during the redevelopment process.
Tensions escalated in December 2023, when shareholders arriving for an AGM were allegedly blocked by private security from entering the venue. The petitioners then moved the National Company Law Tribunal (NCLT), Mumbai, seeking fresh elections.
The NCLT ordered the AGM to be held, but repeated extensions delayed the process until May 2025, when elections were finally conducted under the supervision of a chairman and scrutinizer. Petitioners claim they won by a “thumping majority,” but alleged inconsistencies between the AGM minutes and the scrutinizer’s report led to the NCLT ordering a fresh meeting by April 30, 2025.
When the incumbent board sought yet another extension, the NCLT gave a final deadline of August 31, 2025. The board then approached the NCLAT seeking a stay against the NCLT, Mumbai’s orders.
The NCLAT refused to grant a stay, observing that Justice Kathawalla is now in control of the AGM process and that both sides must cooperate. The appellate body made it clear that no further time would be given and that the meeting must proceed to resolve “leftover disputes or any pending issues.
