SANJIB BANERJEE,J. - (1.) The parties agree that a judgment rendered on any of the six several appeals under Section 10F of the Companies Act, 1956 will cover the other matters. Accordingly, the papers relating to the first appeal on board have been taken up.
(2.) The sole appellant in this case was the respondent no. 19 before the Company Law Board. The other appeals have also been filed by the same person, either in his personal capacity or as 'Karta' of a Hindu undivided family. The legal issues canvassed by the appellant are that the Company Law Board could not have relied on the shareholding position of the concerned company as reflected in its earlier annual returns and accepted the same to be correct in preference to what appeared from the primary documents relating to the shareholding; that the Company Law Board ought to have investigated the circumstances in which the petitioners before the Company Law Board came to be shareholders of the concerned company; and, the Company Law Board should have accepted a subsequent annual return filed on behalf of the company even though the contents thereof were at substantial variance with the contents of the annual return for the previous year that had been filed by the company.
(3.) The petitioners in the proceedings under, inter alia, Sections 397 and 398 of the Companies Act, 1956 complained that though they were the majority shareholders in the company and the annual returns of the company for the years 2001, 2002 and 2003 corroborated such position, they had been reduced to minority shareholders: not by any further shares being issued or share transfers being effected, but merely by the annual return of the company for the year 2004 reflecting a completely altered shareholding position than the one shown in the annual return for the previous year. The petitioners before the Company Law Board claimed to be the owners of or entitled to approximately 80% of the paid-up capital in the company. The petitioners before the Company Law Board asserted that the only meaningful asset of the company (and of the concerned companies in the five other appeals) was the investment of the company in a Jaipur-based company which owns and manages a hospital. The petitioners alleged that the appellant herein had attempted to bypass orders passed by the Company Law Board in proceedings relating to the Jaipur company where the shareholding position was frozen. The petitioners before the Company Law Board contended that the appellant herein had attempted to hijack the several companies which are the subject-matter of these appeals for the purpose of cornering their shareholding in the Jaipur company which controls the hospital. In support of such contention, the petitioners before the Company Law Board referred to how and when they acquired shares in the company and the annual returns of the company that had been filed for the years 2001, 2002 and 2003. It appears that the greater emphasis was laid on the annual return for the year 2002. The petitioners before the Company Law Board showed that an altogether different annual return showing an altered shareholding position in the company had been filed in the year 2004 and, in course of the relevant financial year, the appellant herein had sought to show the convening of general meetings and board meetings of the company for the purpose of appointment or co-option of directors or additional directors in the company, sometimes even unmindful of the fact that the number of directors shown to have been appointed had crossed the limit prescribed therefor in the articles of association of the company.;