SANJIB BANERJEE,J. - (1.) The plaintiffs are in appeal against the partial rejection of their plaint on the first defendant's application under Order VII Rule 11 of the Code of Civil Procedure, 1908. The first defendant has also joined in the fray with its cross- objection and insists that the entirety of the plaint ought to have been rejected. It may be worthwhile to refer to the narrative in the plaint before attempting to discover the plaintiffs' cause of action in respect of the matters complained of or the cause of action as disclosed in the plaint and the legal basis for the reliefs claimed therein.
(2.) According to the plaint, following the relaxation of the norms as to foreign investment in the real estate business in the country, the plaintiffs caused the proforma defendant to be incorporated in India with a paid-up capital or reserves equivalent to US $ 10 million with the intention that the proforma defendant and the first defendant Indian collaborator would be the promoters of the second defendant joint venture company to take up real estate projects in India. The joint venture agreement was entered into in July, 2007. According to the plaintiffs, who control 100 per cent of the paid-up capital in the proforma defendant, though several directors were appointed on the board of the proforma defendant, by or about the end of April, 2009, the third defendant remained as the sole director of such company. The sense that the plaint conveys is that since the plaintiffs, who were the only shareholders of the proforma defendant, were foreign companies and had their place of business in Mauritius, the third defendant Indian resident was entrusted by the plaintiffs for ensuring that the papers and documents of the proforma defendant were prepared in time and maintained in order. The case sought to be made out by the plaintiffs is that despite the plaintiffs' substantial investment in the proforma defendant and such company being incorporated to further the plaintiffs' business interests in this country, the third defendant purported to highjack such company, aligned completely with the persons in control of the first defendant Indian collaborator of the plaintiffs and siphoned off almost the entirety of the funds invested by the plaintiffs in the proforma defendant.
(3.) The plaint narrates that sometime in 2009 the third defendant purported to induct the fourth and fifth defendants as directors on the board of the proforma defendant and caused payments of Rs.1 crore each to be released from the till of the proforma defendant to all three directors. According to the plaintiffs, they apparently met and decided to revoke the authority of the third and fourth defendants to operate the bank account of the proforma defendant and even held an extraordinary general meeting of the proforma defendant by the end of December, 2009 to remove the defendant Nos.3 to 5 from the board of directors of the proforma defendant and to induct others therein. However, the plaintiffs lament, that since the third defendant had not ensured that the accounts of the proforma defendant were audited in time, the plaintiffs or their representatives had no access to the relevant portal of the Ministry of Corporate Affairs to file the statutory forms for the removal of the defendant Nos.3 to 5 as directors of the proforma defendant.;