TRACSTAR INVESTMENTS LIMITED Vs. GORDON WOODROFFE LIMITED
COMPANY LAW BOARD
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(1.)IN this order, we are dealing with a petition in the form of an application under Section 111(4) of the Companies Act, 1956 (hereinafter referred to as "the Act"), filed by Tracstar INvestment Company Limited (hereinafter referred to as "Tracstar") and 4 others seeking rectification of the register of members of Gordon Woodroffe Limited (hereinafter referred to as "GWL") in respect of 5 lakhs equity shares of GWL held in the name of Shoe Specialities Private Limited (hereinafter referred to as "SSPL").
(2.)A summary of the petition is as follows :
Tracstar holds 24.91 per cent. of the paid-up equity capital of GWL. The impugned 5 lakhs shares constitute 12.73 per cent. of the paid-up capital of GWL and were held in the name of SSPL but were in pledge with Tracstar. Tracstar became the beneficial holder of these impugned shares after it foreclosed the pledge for non-payment of dues by SSPL. The second petitioner, namely, Standard Distilleries and Breweries Private Limited (hereinafter referred to as "Standard") and the third petitioner, namely, Stridewell Leather Private Limited (hereinafter referred to as "Stridewell", corporate entities, hold 20 per cent. and 40 per cent. respectively of the paid-up capital of SSPL and as such they are the majority shareholders of SSPL. The fourth and fifth petitioners respectively known as MDC and RDC are shareholders of the second and third petitioners.
(3.)EVEN though Standard and Stridewell are the majority shareholders of SSPL, the board of SSPL controlled by the employees of Shaw Wallace Limited (hereinafter referred to as "SWC") transferred the impugned shares to third parties which is not in the interest of the majority shareholders of SSPL. SWC is under the control of the third respondent, MRC who controls Gordon Woodroffe (UK) Limited which holds 24.9 per cent, of the paid-up capital of GWL. Originally, the impugned shares were offered to Tracstar but at the request of Tracstar, these shares were allotted to SSPL. However, the funds for purchase of these shares by SSPL were provided by Tracstar. The share certificate in respect of these shares was also sent to Tracstar and Tracstar has all along been in possession of this share certificate as a pledgee. These facts were known to all the parties in view of the proceedings in C.P. Nos. 19 of 1992 and 29 of 1992 before the Company Law Board. Standard and Stridewell being majority shareholders filed two petitions under Section 397/398 in C. P. Nos. 29 of 1992 and 44 of 1993 alleging acts of oppression and mismanagement in the affairs of SSPL.
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