A.R.Ramanathan, - (1.) THIS petition under Section 167 of the Companies Act, 1956 (hereinafter called "the Act")- has been filed by Taihan Electric Wire Company Limited, Korea and Tomen Corporation of Japan against TDT Copper Limited (hereinafter called "the company"), on February 14, 1997. According to the petition the two petitioners hold respectively 63,5 per cent, and 26.5 per cent, of the paid up capital of the company with the balance 10 per cent, held by seven other Indian shareholders. It is stated in the petition that the company was incorporated on November 17, 1993, and the first annual general meeting was held on May 16, 1995. The second annual general meeting relating to the year ended March 31, 1996, was called on August 12, 1996, for which notice was received by the petitioners. On the date of the meeting since only the two petitioners were present the meeting had to be adjourned for want of quorum till August 19, 1996, in accordance with Article 15.1 of the articles of association of the company. On the adjourned date none of the members of the company were present at the meeting and as such till the date of the petition the procedure of the second annual general meeting was not completed. The petitioners, therefore, have prayed for an order to call the annual general meeting with a direction that at least two members present in person or in proxy shall form the quorum.
(2.) At the first hearing of the petition the petitioners were directed to serve a copy of the petition on all the other seven shareholders with liberty for them to file their reply. The company was also directed to file full details of litigation, if any, between the two groups, namely, the petitioners' group and the Indian shareholders. Thereafter, in accordance with our direction a reply has been filed by Delton Cables Limited representing the Indian shareholders stating that the petition is not maintainable and ought to be dismissed at the outset. According to the reply the Indian shareholders were not even aware that the second annual general meeting was to be held on August 12, 1996, and the petitioners deliberately did not send the notices of the annual general meeting. It is further alleged that even though the board of directors discussed the proposal for calling the second annual general meeting it did not finalise the date of the meeting and certain items now included in the agenda were not placed before the board at all. Further, the petitioners by their own conduct in abstaining from the meeting have committed default and they cannot be allowed to take advantage of their own default. It is further stated that the petitioners have committed various violations and as such should face legal consequences.
(3.) MALINI Sood, advocate, appearing for the objecting shareholder, namely, Delton Cables Limited, stated that the annual general meeting should not be allowed to be held in view of certain controversial matters which are under the consideration of the Principal Bench of the Company Law Board in a petition filed under Section 397/398 of the Act by the objecting party herein. One such controversial matter relates to the appointment of Mr. J. G. Kim, as a managing director of the company. In addition two additional directors who were to retire at the second annual general meeting were to be regularly appointed, thereby depriving the objecting parties of their prerogative to appoint their own directors. Thirdly, the company is proposing as a special business to mortgage the entire properties which is objectionable. Ms. Sood also contended that the accounts are proposed to be passed in the second annual general meeting but her clients have objections to certain transactions which are the subject-matter of the petition before the Principal Bench.;