Court issues notice in SLP challenging Kerala High Court ruling; key question centres on applicability of Companies Act versus Kerala Non-Trading Companies Act
Apex Court Admits Plea; Notices Issued to Respondents
The Supreme Court of India has admitted a Special Leave Petition filed by V. Vijayakumar challenging the denial of voting rights to members of the Aruvipuram Sree Narayana Dharma Paripalana Yogam (SNDP Yogam) and has issued notices to all respondents.
The petition, arising out of Writ Appeal No. 482 of 2025, assails the judgment dated 19.12.2025 of the Kerala High Court, which had overturned earlier relief granted to members. The present proceedings have been initiated under Article 136 of the Constitution of India .
Notably, the Court proceeded with admission despite a caveat entered by the Yogam’s office bearers, including its General Secretary Vellappally Natesan, and declined to accept submissions made by Solicitor General Tushar Mehta that the issue remained pending before the Central Government.
Arguments Before the Court
Appearing on behalf of the petitioners, Senior Advocate Rajiv Shakdher, along with Advocate K. Gireesh Kumar, Adv Aashish George, Adv Najma Noushad and Adv Urvya Preman argued that the Central Government had already examined the dispute in 2023 and ruled in favour of the petitioners’ position.
Counsel emphasized that the denial of voting rights to the general body of members raises serious statutory and governance concerns affecting a large section of the community associated with the Yogam .
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Core Question of Law: Company or Non-Trading Entity?
At the heart of the dispute lies a significant legal issue:
Whether the SNDP Yogam is governed as a company under central company law or as a non-trading entity under state legislation.
The petitioner contends that the Yogam falls within the ambit of the Kerala Non-Trading Companies Act, 1961, which regulates entities with objects confined to the State of Kerala. Historically, the Yogam—incorporated in 1903 under the Travancore Regulations—continued under successive company laws but later came to be governed by the Kerala statute upon its enactment in 1962 .
It is further argued that multiple judicial and administrative determinations—including proceedings before the Company Law Board and submissions made by the Yogam itself—have consistently acknowledged its status under the Kerala Act rather than central company legislation .
Impact of Statutory Framework on Voting Rights
The classification of the Yogam directly impacts the governance framework, particularly voting rights.
Under its amended Articles of Association—specifically Clause 47—only a limited category of representatives (including a fraction of selected members, directors, and office bearers) were permitted to participate in general meetings. This restrictive structure replaced the earlier system where all members had participatory rights.
The petitioner relies on prior judicial findings, including the decision in P. C. Aravindhan v. M. A. Kesavan & Ors, where such restrictive provisions were declared void. Subsequently, in WP No. 8382 of 2020, the Kerala High Court (Single Judge) held that all members are entitled to vote, declaring the relevant clauses ultra vires the statutory scheme .
However, this position was reversed in appeal, leading to the present challenge.
Validity of Central Government Exemptions
Another crucial legal issue concerns the continuing validity of exemptions granted to the Yogam under the Companies Act, 1956, particularly via an order dated 20.08.1974.
The petitioner argues that such exemptions granted to an individual entity under Section 25(6) of the 1956 Act have become legally untenable following the enactment of the Companies Act, 2013, which under Section 462 permits exemptions only for classes of companies, not individual entities.
Additionally, Section 465 of the 2013 Act renders inconsistent prior orders inoperative. The Central Government itself, in 2023, reportedly declined to extend such exemptions, noting that the Yogam is governed by the Kerala statute .
Doctrine of Estoppel and Inconsistent Stands
The petition further invokes the principle that a party cannot “approbate and reprobate,” contending that the Yogam has taken inconsistent positions before different forums—at times asserting governance under the Kerala Act and at others invoking central company law.
Such inconsistency, it is argued, should estop the Yogam from denying members their statutory rights, particularly the right to vote and participate in general meetings .
Broader Implications for Governance
Speaking to Law Daily, Advocate K. Gireesh Kumar noted that the outcome of the case is likely to have far-reaching consequences on:
- The internal governance structure of the SNDP Yogam
- The scope of member participation in institutional decision-making
- The interplay between central corporate law and state-specific legislation governing non-trading entities
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