Bikki Raveendra Babu, Member - (1.) None Present for Both Parties. Order Pronounced in open Court. Vide separate sheet. This Petition is filed under Sections 397, 398 and 399 of the Companies Act, 1956 alleging acts of oppression and mismanagement in the conduct of affairs of 3rd Respondent Company. 1.1 The Paid-Up Equity Share Capital of the 3rd Respondent Company is Rs. 10,00,000/-. Petitioner is the holder of 26.75% of the equity shares in the Paid-up Share Capital of the 3rd Respondent Company. Mrs. Deepa Larai who is the wife of Petitioner is the holder of 23.25% in the Paid-up Share Capital of the 3rd Respondent Company. The Annual Return dated 29th September, 2007 showed that there were 12 members in the 3rd Respondent Company. Among them, Petitioner and his wife is having 50% of the Paid-up Share Capital of the Company. The other 10 members are holding 50% of the Paid-up Share Capital of the 3rd Respondent Company and they are all belonging to the group of Respondents No. 1 and 2. The Memorandum of Association shows that Petitioner, wife of the Petitioner, and Respondents No. 1 and 2 are the first Directors of the 3rd Respondent Company. 1.2 3rd Respondent Company was incorporated under the provisions of the Companies Act, 1956 on 21st April, 2004 having its Registered Office in Sanand, Ahmedabad. 3rd Respondent Company is engaged in the business of edible oil seeds, cattle feeds, botanical extracts and others. The factory of the 3rd Respondent Company is also situated at the Registered Address.
(2.) According to the Petitioner, there was an understanding between Petitioner and Respondents No. 1 and 2 that the investment in the Company from both sides shall be equal and the Company shall be managed jointly. 2.1 It is alleged by the Petitioner that Respondents No. 1 and 2 started indulging in unwarranted trace practices and siphoning of funds of the Company by dubious methods of under-billing by showing false and fabricated expenses with a view to enrich themselves personally. It is also alleged by the Petitioner that Respondents No. 1 and 2 sold away the stock of the Company and pocketed the money for personal benefit. Petitioner came to know about the sale of stock of the Company without notifying the Petitioner of such sale and the Petitioner came to know of the same only in September/October 2007. Respondents No. 1 and 2 also sold some of the equipment of the Company and did not account for the same in the books of accounts. The repeated requests of the Petitioner to show the accounts did not give any result. Petitioner strongly protested against the mala fide and illegal practices of the Respondents No. 1 and 2 and thereby differences between the Petitioner and Respondents No. 1 and 2 reached to a point of no return. 2.2 It is also alleged by the Petitioner that Respondents No. 1 and 2 misused and misapplied the loan taken from Indian Overseas Bank (IOB) for the business of the Company. Respondents No. 1 and 2 defaulted in repayment of loan taken from the Bank deliberately. Respondents No. 1 and 2 planned to dispose of assets of the Company in order to evade and defeat the loans granted to the Company by IOB. 2.3 In those circumstances, Petitioner was constrained to file Civil Suit No. 48 of 2008 against the Respondents No. 1 and 2 and another before the City Civil Court at Ahmedabad on 4.1.2008 for a permanent injunction restraining Respondents No. 1 and 2 herein to have access to the premises of the 3rd Respondent Company; for a permanent injunction restraining Respondents No. 1 and 2 herein from transferring or alienating in any manner the assets of the 3rd Respondent Company herein; and for a direction to the IOB to realise its dues by acquisition under sale of assets of 3rd Respondent Company. 2.4 According to the Petitioner, due to filing of the said Suit, Respondents No. 1 and 2 threatened the Petitioner stating that he would be thrown out of the Company. 2.5 It is alleged by the Petitioner that a meeting of the Board of Directors was convened on 23.2.2008 but no notice of meeting was given to the Petitioner or his wife but Petitioner and his wife on coming to know about the meeting on 23.2.2008 at 5.00 P.M. went to the Registered Office of the Company but they were not allowed to participate in the meeting and in fact they denied access to the premises of the meeting. In the said Board Meeting on 23.2.2008, following Resolutions were passed; (a) To convene EOGM at 6.00 P.M. on 23rd February, 2008; (b) To authorize 1st Respondent to operate the Bank account with IOB with Account No. C.C. 617 in supersession of the earlier resolution passed by the Board of Directors; (c) To communicate to the Bank to accept the signature of the 1st Respondent in relation to the transactions of the Company, signing of cheques etc. (d) 1st Respondent be appointed as 'Managing Director' of the Company with all powers of administration and management of the Company pursuant to Article 25 of the Articles of Association of the Company with effect from 23.2.2008 authorising the 1st Respondent Managing Director of the Company to sell, dispose of, or transfer the properties both movable and immovable of the Company; (e) To authorize the 1st Respondent as Managing Director of the Company to arrive at an agreement with the lenders of the Company and to settle the matter on behalf of the Company. 2.6 It is stated by the Petitioner that he was illegally removed from the Directorship of the Company under the provisions of Section 284 of the Act by making an unsigned resolution dated 5.6.2008 in the EGM held on 5.6.2008 and submitted to the ROC. It is further stated by the Petitioner that Respondents No. 1 and 2 with a mala fide design removed the Petitioner from the Directorship of the Company while allowing his wife as Director who is only a housewife and who is not able to actively participate in the affairs of the Company. 2.7 It is further stated that Petitioner and his wife were not allowed to enter the premises where the EGM was held on 5.6.2008. 2.8 Petitioner further alleged that Respondents No. 1 and 2 are mismanaging the affairs of the Company and siphoning of the funds of the Company by selling the stocks of the Company and assets of the Company which includes moveable and immoveable. 2.9 Petitioner also alleged that Respondents No. 1 and 2 are preventing the Petitioner from participating in the affairs of the Company and they are denying access to the records and registers of the Company. Petitioner was denied entry into the factory premises on 10.5.2008 by Respondents No. 1 and 2 who directed the Petitioner to leave the premises immediately. 2.10 According to the Petitioner, the following are the value of assets of the Company;
(3.) Petitioner prays for the following reliefs; (a) To restore the Petitioner as 'Director' of the Respondent Company in accordance with law; (b) To direct the Respondents No. 1 and 2 to appoint the Petitioner as 'Director' of the Respondent Company; (c) To direct the Respondents No. 1 and 2 to serve notices of all meetings and to hold all meetings in the Registered Office of the Company; (d) To direct the Respondents No. 1 and 2 not to dispose of any moveable and immoveable assets of the Company; (e) To direct the Respondents No. 1 and 2 to operate the Bank accounts jointly with Petitioner and another Director; (f) To restrain Respondents No. 1 and 2 from passing any Resolution or from selling, transferring, disposing, alienating or in any way dealing in the moveable and immovable assets of the 3rd Respondent Company; (g) To restrain Respondents No. 1 and 2 from causing obstruction to the Petitioner from having access to records of the Company including minutes, books of accounts, etc.;