Dipak Kumar Sen, J. - (1.) - Sandhyasree Saha and Manjushree Saha the plaintiffs, instituted the above Suit on or about the 15th May 1984 with leave under Clause 12 of the Letters Patent and also Order 1, Rule 8 of the Code of Civil Procedure against Ambari Tea Company Limited, Krishnagopal Kundu Saha, Naresh Acharya Bhadhuri, Nandadulal Saha, Juthika Saha, Himangshu Dutta, Ruprakash Saha, Santosh Saha and Shamananda Saha impleaded respectively as the defendants Nos. 1 to 9 claiming, inter alia a declaration that the notices, dated April 23, 1984 convening the 74th, 75th and 76th Annual General Meeting of the Ambari Tea Company Ltd., the defendant No. 1, on May 19, 1984 are illegal, void and inoperative; a perpetual injunction restraining the defendants Nos. 2 to 8 from holding the said Annual General Meetings of the defendant No. 1 in pursuance of the said notices on May 10, 1984 or on any other date or passing any resolution thereat; a declaration that the defendants Nos. 2 to 8 and each one of them have ceased to be the directors of the defendant No. 1 and cannot act as such; an injunction restraining the defendants No. 2 to 8 from holding out or acting as directors of the defendant No. 1; the Board of Directors of the defendant No. 1 be superseded and a Receiver or Special Officer or Administrator be appointed to conduct the management and affairs of the defendant No. 1 vested with the full powers of the Board of Directors of the defendant No. 1.
(2.) The case of the plaintiffs in the plaint is, inter alia, that- (a) The defendant No. 1 is an existing limited company within the meaning of the Companies Act, 1956 and owns and runs a tea garden known as Ambari Tea Estate in the District of Jalpaiguri of West Bengal. (b) The plaintiffs are share-holders of the defendant No. 1. (c) Article 102 of the Articles of the defendant No. 1 is as follows; "At each Annual General Meeting of the company one third of such of the Directors for the time being as are liable to retire by rotation if their number is not three or a multiple of three then the number nearest to one-third shall retire from office. An additional Director appointed by the Board under Article 91 hereof shall not be liable to retire by rotation within the meaning of this Article." (d) The last Annual General Meeting of the defendant No. 1, viz., the 73rd Annual General Meeting was held on the 30th September 1980 where the Balance-sheet and the Profit and Loss Account of the defendant No. 1 for the year ended the 31st December 1979 were accepted and adopted. (e) (i) The defendant No. 2 was re-elected as a Director of the defendant No. 1 at the Annual General Meeting of the latter held on the 27th June 1979. (ii) The defendant No. 3 was appointed as a Director of the defendant No. 1 in March 1984 against the vacancy caused by the resignation of one Director on the 17th March 1984. The latter had been elected as a Director on the 30th September 1980 at the last Annual General Meeting of the defendant No. 1. (iii) The defendant No. 4 was co-opted as a Director on the 25th February 1981 in place of another Director who was reelected as a Director of the defendant No. 1 at the last Annual General Meeting of the company held on 30th September 1980. (iv) The defendant No. 5 was appointed as a Director of the defendant No. 1 on the 25th February 1981 in place of Ramananda Saha her husband, who was re-elected as a Director at the Annual General Meeting of the defendant No. 1 held on the 27th June 1979. (v) The defendant No. 6 was appointed as a Director of the defendant No. 1 on or about the 9th February 1984 against the vacancy caused by the resignation of the defendant No. 4 who was re-elected as a director at the Annual General Meeting of the defendant No. 1 held on the 30th August 1978. (vi) The defendant No. 7 was re-elected as a Director at an Annual General Meeting on the 30th August 1978. (vii) The defendant No. 8 was re-elected at the Annual General Meeting of the defendant No 1 held on the 27th June 1979. (f) The defendants Nos. 2 to 8 are presently claiming to be and acting as the directors of the defendant No. 1. The defendant No. 1 is claiming to be the chief executive of the defendant No.1. (g) As on Annual General Meeting of the defendant No. 1 has been held after the 30th September 1980 the defendant Nos. 2 to 8 and each of them would be considered to have vacated their office as Directors of the defendant No. 1 between September 1981 and September 1983. On and from September 1983 by operation of the mandatory provisions of the Companies Act there are no lawful Directors of the defendant No. 1. (h) The Annual General Meeting of the defendant No. 1 to consider the accounts for the year ended 31st December 1980 ought to have been convened and held within the 30th September 1981. Taking into account the extension of three months which in law could be granted by the Registrar of Companies, at the maximum. The Board of Directors of the defendant No. 1 had no power to convene or hold an Annual General Meeting to consider the accounts of the defendant No. 1 for the year ending the 31st December 1980 or to transact other business to be considered at such a meeting after the 30th September 1981. (i) After the 30th September 1981 only the Central Government was empowered to convene an Annual General Meeting of the company under Section 167 of the Companies Act, 1956. (j) No Annual General Meeting of the defendant No. 1 has been convened or held in 1982 and 1983. (k) Three notices all, dated the 23rd April 1984, have been issued in the name of the defendant No. 1 purporting to call the 74th, 75th and 76th Annual General Meeting of the company for the years ending of the 31st December of 1980, 1981, 1982, to be held on the 19th May 1984. (1) Along with the notice a statement of account of the defendant No. 1 as at the 31st December 1980 for the 74th Annual General Meeting, an auditor's report, dated the 19th April 1984, the Director's report, dated the 23rd April 1984 and an explanatory Statement in respect of the special business sought to be transacted in the said meeting have been annexed. (m) In the notices for the 75th and 76th Annual General Meeting's no accounts, Directors' report or Auditors' report for the corresponding period have been annexed. (n) The said notices, dated the 23rd April 1984, are all illegal, void and ultra vires the Companies Act on the following grounds: (i) The notices have been signed by the defendants Nos. 5 and 8 as directors. The said defendants are not lawful or valid Directors of the defendant No. 1 and have no authority by themselves or from the Board of Directors, which is non-existent, to call such meetings. (ii) The explanatory statements annexed to the said notices are tricky and misleading and do not disclose material facts. (iii) In the notices convening the 75th and 76th Annual. General Meeting it is stated in the agenda that consideration and adoption of Balance-sheet and Profit and Loss Account with the auditors report will be adjourned as also the agenda regarding the re-appointment of auditors. The said item in the agenda is exfacie, mala fide, oppressive and against the interest of the share-holders of the company and is intended only to allow the pretended Directors to re-appoint themselves. (o) The defendants Nos. 2 to 8 with their supporters and followers are trying to corner the shares of the defendant No. 1. On the ground that share certificates have been lost in respect of small holdings by different persons advertisements are being published for issue of duplicate share certificates in place of alleged lost certificates. Thereafter, with the aid of the duplicate certificates, transfer of shares are being effected in favour of the defendants Nos. 2 to 8 and their group. (p) The defendants Nos. 2 to 8 at the same time are refusing registration of transfers received by the defendant No. 1 in the names of persons not in the group of the said defendants. A number of applications has been made in this Court under Section 155 of the Companies Act, 1956. Appeals have also been filed before the Company Law Board under Section 111 of the Companies Act. (q) The defendants Nos. 2 to 8 have no right to act or hold themselves out as directors of the defendant No. 1 but they are acting as such directors and are misappropriating the funds and assets of the defendant No. 1. Tea produced by the defendant No. 1 are being sold at gross undervalue.
(3.) On a notice taken out sometime in May 1984 the plaintiffs made an application in the suit for the following orders: (a) An injunction restraining the defendants Nos. 2 to 8 from acting as members of the Board of Directors and the defendant No. 9 from acting as the Chief Executive of the defendant No. 1; (b) An injunction restraining the defendants Nos. 2 to 9 from dealing with of disposing of or encumbering the assets of the defendant No. 1 in any manner; (c) An injunction restraining the defendants Nos. 2 to 9 from operating the banking accounts of the defendant No. 1 or dealing with the money or funds of the latter. (d) An injunction restraining the defendant Nos. 2 to 9 from holding the Annual General Meetings of the defendant No. 1 scheduled on May 19, 1984 or any other date and to transact any business in the said meetings pursuant to the notices, dated the 23rd April; (e) An Administrator or Receiver or Special Officer be appointed over the defendant No. 1 to take possession and charge of all the assets, properties and books of accounts of the defendant No. 1 including the statutory books and to manage the defendant No. 1.;