Rajeswara Rao Vittanala, Member - (1.) The main Company Petition bearing CP No.235/100/HDB/2017 is filed by M/s. Ind-Barath Power Infra Limited (Petitioner herein) against M/s. Ind-Barathand 07 others, by seeking the following main and interim reliefs:- Main reliefs sought: (a) Declare that notice dated 06.10.2017 by R-2 to R-1 is illegal and contrary to law and also the Articles of Association of R-1 Company and also contrary to Amended Restated and Facility Agreement dated 27.03.2015. (b) Pass such further or other orders as this Hon'ble Tribunal may deem fit and proper and thus render justice. \ Interim Reliefs: (a) Restrain Respondent No.2 from conducting any General Body Meeting of R-1 Company till disposal of the Company petition. (b) Pass such further or other orders as this Hon'ble Tribunal may deem fit and proper and thus render justice.
(2.) The brief facts, leading to the filing of the present main Company Petition, and also CA 177 8t CA 178 of 2017, which are relevant to the issue in question and as stated in the petition, are as follows:- (1) M/s. Ind-Barath Power infra Limited (Petitioner) is a Company incorporated under the Companies Act, 1956, having its registered office at New No.20 (Old No.129) , Chamlers Road, Nandanam, V. Tenyampet, Chennai 600035. (2) M/s. Ind-Barath Termotek Private Limited (Respondent No.1) was incorporated under the provisions of the Companies Act, 2013 on 15.12.2014. Its registered office is at 8-2-293/82/F/A/30, Plot No. '30A, Road No.1 Film Nagar, Jubilee Hills, Hyderabad - 500006. The main objects of the R-1 Company is to carry on business of operating and maintaining electric of all other kinds of power generation projects, to carry on business of providing operating and maintaining facilities relating to electric and power generation projects etc. Its authorized share capital is Rs. 2,00,00,000 /- divided into 20,00,000 equity shares of Rs. 10/- each and the paid up capital of the Company is Rs. 1,86,280/-divided into 18.628 equity shares of Rs.10/- each. \ (3) It is stated that the Petitioner Company is owner of 18,626 Equity shares constituting 99.99% of the fully paid up share capital R-1 Company before the impugned illegal transfer of shares by the Respondent No.2 and a separate petition is filed for that issue and both the petitions may be heard together for convenience. (4) The Shareholding pattern pf R-1 Company as on 25.08.2017 before the impugned share transfer is as follows:- (5) In the year, 2009, the Respondent No.3 started to set up a 700 MW (2x 350 MW) of Coal Fired Thermal Power Plan (two Units) at Sahajbahal in Jharsuguda District, Orissa (herein referred to as Project) . At the time of original sanction from various lenders i.e. in the year 2010, the total project cost appraised by the lenders was Rs. 3,185 crores. (6) The Respondent No. 3 entered into a Common Rupee Term Loan Agreement dated 29.03.2010 with 14 Banks, their trustees and agents for the purposes of part financing the project cost up to Rs. 2,389 Crores with a sub-limit of Rs. 365 crores there under towards LC Facility. The commercial Operation Date / date of commencement of commercial Operation (CoD/SCOD/DCCO) of the project under the said Agreement was amended from time to time i.e.' on 18.09.2012 and 23.12.2014. The Project was since then rescheduled owning to inter-alia, reasons such as floods, public interest litigations initiated by nongovernmental organizations, legal challenges on allotment of open access by the state-owned electric utility company Power Grid Corporation of India Limited. Due to above reasons Respondent No.4 revised the project cost to 4001.30 crores (page 206 of Amended and Restated Facility Agreement dated 27.03.2015) and consortium have cumulatively funded loan facility to the extent of Rs.2968.91 crores. The said Common Rupee Term Loan Agreement and the Amendment Agreement mandates that the promoters shall maintain minimum 51% of the total paid up capital and shall have control over the Management of the Respondent No.1 Company. (7) As per the said Amended and Restated Facility Agreement dated 27.03.2015, the promoters and the Company are supposed to maintain 51% shareholding and management control. (8) Respondents No. 5 8t 6 have invested in R-1 Company, after knowing very well the provisions and consequence of the Amended and Restated Agreement dated 27.03.2015. (9) The Respondent No.5 invested in one Equity share of Rs. 10/- each issued at premium of Rs. 9,33,990/- in R-1 Company. It has also subscribed to 9,06,599 Zero Coupon Compulsorily Convertible Debentures of Rs.10 each for an aggregate consideration of Rs. 90,65,990/-. The Respondent No.6 also subscribed to 7,790 Non-Convertible Debenture of face value of 10 lakhs with a tenure of 10 years in the R.No.1 Company for an aggregate consideration of Rs.779 crores bearing interest of 14.02 % per annum. (10) In pursuant to the above investment made by Respondent Nos.5 & 6, the Articles of Association of R.No.1 Company was restated incorporating the conditions of said investment agreement. (11) The Petitioner pledged 9,500 shares (51%) out of 18,626 shares held on 09.07.2015 in R-1 Company in favour of Respondent No.2 who is the Debenture Trustee. The Respondent No.1 pledged 50,57,79,500 shares (48.99%) in Respondent No.3 Company in favour of Respondent No.2. (12) The Shareholding of Respondent No.3 prior to impugned transfer of shares is stated below:- (13) The shareholding pattern of Respondent No.3 post illegal transfer of shares is as under:- (14) The share holding pattern of R-1 Company post illegal share transfer as on 06.10.2017 is as SI. n No.d Name of the Share Holder No. of Shares Percentage (15) It is contended that by virtue of the above transactions, the shareholding of the Petitioner has come down to 49%. Again the Respondent No.2 along with Respondents No. 5 & 6 are trying to wrest the control of R-1 Company. Respondent No.2 is also attempting to convert 9,06,599 CCD's into 9,06,599 shares of Rs. 10 each of R.1 Company. If that happens Respondent No. 2 along with Respondent Nos. 5 and6 would be virtually controlling 100% of the equity of Respondent no.1 Company. This attempt is in violation of the said Agreement dated 27.03.2015 and also Articles of Association of R-1 Company. (16) It is contented that as per Article 65.1 of the restated Articles of Association of the Respondent No.1 Company, any transfer of shares are subject to the said Agreement dated 27.03.2015, which mandates that promoters and the Company to maintain a specified shareholding percentage in Respondent No.3. (17) It is contented that the Petitioner itself or through its affiliate shall maintain 51% shareholding in Respondent No.3 Company and shall have control over the management of Respondent No.3 Company. The Petitioner through its subsidiary (R-1) was holding 99.99% of the total paid up share capital of Respondent No.3 Company prior to the impugned transfer of shares on 31.08.2017. (18) It is further contented that the shareholding of the Petitioner, by virtue of the impugned illegal transfer of shares would lead to reduction of Petitioner's holding from 99.99% to 48.99% resulting R.1 to cease to be affiliate/subsidiary of the Petitioner which would be the violation of Article 65.1 of the Articles of Association of the Company. It is contented that the R.1 Company received a letter dated 12.09.2017 from Respondent No.2, in which it contains Respondent No.5 request to convert CCD's into equity shares and also redeem NCD's held by Respondent No.6 in R-1 Company. They are exercising their right under 6.3 and 6.5 of Debenture trust deed dated 27.06.2015 seeking to convene a General Body Meeting of R-1 Company shareholders by inter-alia seeking to remove the following nominee Directors of the Petitioner viz. (a) Mr. K. Bharat (b) Mr V. Perraju (c) Mr. N. Kumaraswmy (d) Mr. G.A. Raj Kumar (e) Ms N. Sumalatha Subsequently, the Petitioner received letter dated 06.10.2017 on 07.10.2017, by seeking to convene EGM of R-1 Company along with purported EGM notice issued by Respondent No.2 in the capacity of Debenture Trustee. Therefore, the Petitioner has raised following serious objections / lacunas in the impugned notice dated 06.10.2017. (i) Whether a Debenture Trustee can call for meeting of shareholders under 100(2) of the Companies Act, 2013 (ii) Whether the Respondent No.2 can act against the interest of the pledger of the shares (the Petitioner) (iii) Whether the Debenture Holder can convene a General Body Meeting under Section 100(2) (iv) The notice further claims under the instructions by Respondent No.5 and 6, the notice is given. It may be noticed that Respondent No.5 has a single share in R-1 Company and Respondent No.6 has no shares in the R-1 Company (v) Whether the action sought under the notice is contrary to Clause 29 of Amended and Restated Facility Agreement dated 27.03.2015 (vi) Whether the action sought under the notice is contrary to Article 18 and 65.1 of Articles of Association of R-1 Company (19) It is contended that the Respondent No.7 along with Respondent No. 8, who are "Registrar & Transfer Agent" and Depository of the Company respectively, have acted contrary to the law, wherein the impugned transfer of shares in favour of Respondent No.2 was automatically and mechanically permitted without the specific approval of the Board of Directors of R-1 Company. It is further pointed out that the impugned transfer on 31.08.2017 is in violation of Article 65.1 of Articles of Association of R-1 Company. Further Respondent Nos 7 & 8 have deliberately acted against and in contrary to Article 18 of Articles of Association of R-1 Company. The transfer of shares has been affected by these Respondents even without the Board of Directors knowledge or approval. It is fundamental principle of Company law that no shares in a private company can be transferred without a specific approval of the board. (20) It is stated that the Petitioner addressed a detailed letter dated 09.10.2017 to the respondent No. 8 requesting to retransfer the transfer of 9,500 equity shares in R-1 Company in favour of Respondent No. 2. Neither any reply received so far nor rectified the members register despite the grave error committed by them.Further Respondent No. 1 Company wrote a letter of Respondent Nos. 7 & 8 complaining about the illegal transfer of shares vide their letter dated 10.10.2017 but to no avail.
(3.) Heard Shri D. Srinivas, Learned Senior Counsel along with Shri P. Vikram, Learned Counsel for the Petitioner, Shri S. Niranjan Reddy, Learned Senior Counsel along with Ms. Pujitha, ,for Respondent No. 5 & 6, Shri D.A.V.S. Ravi Prasad, Learned Counsel for Respondent No. 1 & 3, Shri Y. Suryanarayana, Learned !|| Counsel for Respondent No. 2 and Shri A.S. Prashanth, jj Learned Counsel for Respondent No. 4. I have also carefully perused all the pleadings of both the parties along extant provisions of Companies Act, 2013.;