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SAM for McDonald’s India MD Vikram Bakshi NCLT win vs Dua for McDonald’s

“In a major setback to the US- based fast food chain McDonald's in India, the National Company Law Tribunal (NCLT) today restored its estranged partner Vikram Bakshi as the Managing Director of Connaught Plaza Restaurant Ltd. The tribunal has said the meeting of Connaught Plaza Restaurants Ltd (CPRL) of August 6, 2013 in which Bakshi was removed as MD of the company was illegal, unjust and malafide,” reported the PTI.

Shardul Amarchand Mangaldas Delhi partner Tejas Karia, senior associate Manavendra Mishra and associate Karan Mehra briefed senior advocate SN Mookherjee and instructed advocated Pritpal Nijjar for Vikram Bakshi and Bakshi Holdings.

Dua Associates Gurgaon partners Rahul P Dave and Amit Dhingra and associates Sumit Chopra and Shivam Raheja, instructed advocate on record Rahul Narayan and advocates Rohan Jaitley and Naira Jeejeebhoy and briefed senior advocates Sudipto Sarkar and Iqbal M Chagla for McDonald's India and its nominee directors Robert Dale Larson and Ayesel Melbye.

Advocates Satyajit Sarna and Mohit Negi briefed senior advocate Arun Kathpalia for Connaught Plaza Restaurants General Manager Legal Devinder Jain.

Bakshi fought a 3-year legal battle contending that he was ousted from the post of McDonald's India's managing director (MD) in an “illegal, mala fide, malicious and oppressive” manner which violated the terms of the joint venture agreement with the intention of buying him out at lower valuations, according to Mint.

“In 2013, McDonald’s had voted against the re-election of Bakshi as managing director of Connaught Plaza, following which Bakshi challenged his removal in the Company Law Board (now the National Company Law Tribunal ), accusing McDonald’s of mismanagement and oppression,” Mint reported.

A two-member National Company Law Tribunal (NCLT) bench headed by president justice MM Kumar said that the decision to remove Bakshi as managing director of McDonald's India was “illegal, unlawful, unjust and malicious”, and ordered:

It is well settled that if the parties have understood the contents of a contract/document by acting upon it in particular manner, then it is not possible to accept any contrary interpretation or proposition.

Moreover the translation of intentions of the parties in practice from 1995 to 2013 cannot be brushed aside by adopting an interpretation which would be contrary to the understanding of the parties of the whole contract to justify one sole deviation.

Advocate Deepak Khosla had intervened in the case alleging perjury against Bakshi, however dismissing his submissions the bench ordered that it is not open to an unrelated intervenor to raise perjury allegations in this case, and also in general there were no findings of perjury against Bakshi in the case. Khosla was not available for comment at the time of going to press.

Bakshi's dispute with McDonald's US management had led to 43 out of 55 McDonald's outlets in Delhi shutting shop on 29 June after their licences expired, as reported by NDTV.

Read the NCLT order (PDF)

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