Indira Banerjee, J. - (1.) This appeal under Sec. 10F of the Companies Act, 1956, is against an order dated 25th April 2005 of the learned Company Law Board, in an application of the Appellants under Sec. 247(1A) read with Sec. 250 of the Companies Act, 1956 refusing to direct the Central Government to appoint an Inspector and/or Inspectors to investigate into the affairs of Birla Corporation, hereinafter referred to as the company, as regards the membership of the company and other matters relating to the company, for the purpose of ascertaining the true persons who are financially interested in the success or failure of the company or are controlling the company.
(2.) The Appellants, who admittedly own less than 0.16 per cent of the shares of the company, filed an application in the Company Law Board under Sec. 247(1A) read with 250 of the Companies Act, inter alia praying for the following orders: (a) the relevant facts in relation to the shares in the company particularly the ones held by the Respondent Nos. 1 to 28 be enquired into (b) an investigation be directed on such terms and on such conditions as to this Hon'ble Board may seem fit and proper for obtaining information and ascertaining the true identity of person or persons who are financially interested in the success or failure, whether real or apparent, of Birla Corporation Limited and further, to ascertain the true identity of the person or persons who are able to control or to materially influence the policy and affairs of the company; (c) An investigation be directed to ascertain as to whether the provisions of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 have been complied with by the persons now seeking to control or to materially influence the policy and affairs of he company. In the aforesaid application the Appellants also prayed for an interim order of injunction restraining the Respondent Nos. 1 to 28 from exercising any rights as shareholders of the company including the right to vote or to receive dividends, bouns shares or rights shares.
(3.) The sole ground for seeking an investigation, as disclosed in the application, in the death of Smt. Priyamvada Devi Birla, who had controlling interest in the Respondent Nos. 1 to 28, who jointly hold 63.8 per cent of the shares of the company and disputes with regard to alleged wills allegedly executed by her. There is no allegation of mismanagement of the company, of siphoning of funds or of the company being run in a manner against its own interest, against the interest of its share holders or against public interest. Some of the averments in the petition filed before the Company Law Board are extracted herein below: 13. After the death of Madhav Prasad Birla and till her death on July 3, 2004, Smt. Priyamvada Birla was the promoter Chairman of the company. 22. ...It appears that the said Lodha is seeking to exercise control over the shareholding of the Respondent Nos. 1 to 19 companies and the charitable societies. 23. In view of the pending proceeding before the Hon'ble High Court at Calcutta and the serious disputes in respect of the two sets of Wills relating to the estate of Smt. Priyamvada Birla, no question arises of any person exercising any control in respect of the shares formerly controlled by Smt. Priyamvada Birla. 28. Such investigation and necessary ancillary orders have been necessitated, inter -alia, inasmuch as substantial change, long term in nature, is being sough to be brought about in the composition of the Board of Directors of the company at the Annual Genera Meeting of the company which has been sought to be convened on September 15, 2004. A true copy of the relevant notice in respect of such Annual General Meeting is annexed hereto and marked 'P -4'.;