Bikki Raveendra Babu, Member - (1.) This Petition is filed by one of the Directors of 1st Respondent Company (hereinafter referred to as "the Company") who is also holding 5000 equity shares of the Company seeking certain orders/directions under Section 241 and 242 of the Companies Act, 2013 alleging acts of oppression and mismanagement against Respondents No. 2 and 3.
(2.) Before going into the alleged acts of oppression and mismanagement averred in the Petition, it is necessary to state about the background and incorporation of the Company. 2.1 Petitioner and Respondents No. 2 and 3 came to an understanding to set-up the 1st Respondent Company. It was agreed that Petitioner shall provide his medical expertise and know-how, whereas Respondents No. 2 and 3 will be responsible for business development and management of the Company. 2.2 The Company was incorporated as 'Private Limited Company' on 26th April, 2010. The Registered Office of the Company is in Sachin, Gujarat State. The object of the Company is to formulate, prepare, buy, sell, import, export, supply, distribute, store, stock, and otherwise deal in and carry on business in all kinds and varieties of medical devices, instruments, meters, chemical and surgical dressings etc., etc., 2.3 The Authorised Share Capital of the Company as on 19th August, 2016 was Rs. 25,00,000/- divided into 2,50,000 equity shares of Rs. 10/- each. The Issued and Paid-Up Share Capital of the Company as on 19th August, 2016 was Rs. 1,00,000/- divided into 10000 equity shares of Rs. 10/- each. Petitioner is having 5000 equity shares of the Company and he is one of the Directors of the Company. Respondent No. 2 is also having 5000 equity shares of Rs. 10/- each in the Paid-Up Capital of the Company. Differences arose between Petitioner and Respondents No. 2 and 3 regarding management and affairs of the Company. Petitioner made several attempts to amicably resolve the issues with Respondents No. 2 and 3 but reconciliation efforts failed. Petitioner chose not to oversee affairs of the Company and allowed Respondents No. 2 and 3 to carry on the business of the Company in the manner in which they deem fit. Since January 2012 Petitioner has not been informed about the activities of the Company. Petitioner has not been given any notice of Board Meetings or Shareholders Meeting of the Company since 2012 inspite of repeated reminders by the Petitioner. In April 2016, one of the old clients of the Petitioner informed the Petitioner that certain suspicious activities are going on in the Company and about the conduct of Respondents No. 2 and 3 in causing damage to reputation of the Company. Respondents No. 2 and 3 had been keeping the Petitioner in dark about the affairs of the Company. Therefore, Petitioner verified the activities of the Company on the web portal of Ministry of Corporate Affairs. Petitioner came to know that a Resolution was passed on 8th October, 2013 appointing 3rd Respondent as Director of the Company and further Resolution was passed authorising any one of the existing Directors to sign and file necessary Form 32 for giving effect to the appointment of Respondent No. 3 as Director. Petitioner had not been served with any notice for the Board Meeting dated 8th October, 2013. It is not even specified that Petitioner was granted leave of absence for the Board Meeting dated 8.10.2013. Respondents No. 2 and 3 colluded together and passed the Resolution dated 8.10.2013 keeping the Petitioner in dark. The meeting of the Board of Directors of the Company was held on 23rd January, 2014 but no notice of such meeting had been given to the Petitioner. In the said Board of Directors' meeting it was resolved that the following Directors have given notice of interest; 1. Mr. Chetan Dilipkumar Nemlawala 2. Mr. Rahuldev Pramodkumar Vyas 3. Mr. Shammi Dipak Nemlawala. It is also resolved in that Meeting that any Director of the Company is authorised to file requisite e-forms with the Registrar of Companies. 2.4 It is stated by the Petitioner that another Board Meeting was held on 27.9.2014 without giving notice to the Petitioner. In that meeting resolutions were passed approving the Balance Sheet, Statement of Profit and Loss, Cash Flow Statements and Directors' Report for the financial year ended on 31st March, 2014. In the said Meeting, Mitul P. Shah and Associates were appointed as 'Auditors' of the Company. It is stated by the Petitioner that, Petitioner and Respondents No. 2 and 3 are shown as 'Directors' of the Company whereas Petitioner and Respondents No. 2 and 3 are having 5000 shares each of the Paid-Up Capital of the Company, as can be seen from Form MGT-7 filed for the financial year 2013-2014. As can be seen from the said Form, five Board Meetings were held between financial year 2014-2015. It is shown in that form that petitioner attended 5 Board Meetings. According to the Petitioner he neither received notice for the alleged Board Meetings nor he attended the board meetings. 2.5 Petitioner alleged that Respondents No. 2 and 3 were carrying out prejudicial acts against the Petitioner taking advantage of their position. Respondents No. 2 and 3 have been misrepresenting the involvement of the Petitioner to the clients and have been acting on behalf of the Petitioner without his knowledge. Petitioner wrote letter dated 19th August, 2016 to IDBI Bank Ltd. and Surat Peoples Cooperative Bank Ltd., informing them that there exists dispute between Petitioner and Respondents No. 2 and 3 regarding conduct of affairs of the Company and requested the Banks to take necessary steps not to allow any transfers or withdraws and not to grant any other withdrawal limits. The Manager of Surat Peoples Cooperative Bank Ltd. accepted letter of the Petitioner and assured him. The Manager of IDBI Bank refused to accept the letter of the Petitioner on the ground that Resolution of the Board is necessary. Thereafter Respondents No. 2 and 3 approached the Petitioner for settlement. A meeting was held on 24th August, 2016 between Petitioner and Respondents No. 2 and 3 to amicably settle the issue but no solution was found. After the meeting of 24th August, 2016, i.e., on 2nd September, 2016 petitioner wrote a letter to Respondents No. 2 and 3 listing about the wrong doings of Respondents No. 2 and 3. Petitioner also demanded inspection of documents mentioned by the Company. After the receipt of letter dated 2nd September, 2016, Respondents No. 2 and 3 approached the Petitioner for another meeting to amicably settle the disputes. Again meeting was held on 11th September, 2016. But no solution was arrived at. Thereafter, Petitioner addressed letters dated 19th September, 2016 and 4th October, 2016. In the letter dated 4th October, 2016 petitioner demanded for inspection of books of Minutes of Meeting of the Company indicating that the inspection would be conducted by representative of the Petitioner on 17th October, 2016. On 7th October, 2016 petitioner went out of town. After he returned he noticed an envelope placed in the gap between the two doors wherein a notice for the next AGM of the Company to be held on 30th September, 2014 along with attendance slip of proxy form were provided. The said notice was delivered after the date of the meeting. Respondents gave back-dated replies by way of Mail to the letters of the Petitioner dated 2nd September, 2016, 19th September, 2016, 4th October, 2016, on 6th October, 2016, 10th October, 2016 and 13th October, 2016 respectively. In those mails, Respondents No. 2 and 3 raised several baseless allegations against the Petitioner. In the letters dated 10th October, 2016 and 13th October, 2016, Respondents No. 2 and 3 claimed that they have communicated to the Petitioner regarding the Board Meetings and General Meetings. It is alleged by the petitioner that Chartered Accountant of the Company, Mr. P.K. Shah informed the petitioner that during his absence Respondents No. 2 and 3 approached him to issue back-dated notice of meeting of the Company along with absence letters of petitioner. It is stated by the petitioner that Respondents No. 2 and 3 by initiating such measures fabricated the record of notice of meetings. Respondents No. 2 and 3 taken all steps to malign the petitioner. Respondents No. 2 and 3 informed the Head Office of Surat People's Cooperative Bank Limited (SPCBL) that Petitioner is no longer a Director and basing on that information only SPCBL renewed the cash credit facility of the Company. Petitioner called upon Respondents No. 2 and 3 to produce Resolution whereby he was removed from the position of Director. Respondents No. 2 and 3 are conducting the business of the Company with intent to defraud the Petitioner.
(3.) Petitioner prayed for the following reliefs in the Petition; (i) To appoint an Administrator(s) or Special Officer(s) or Independent Committee of Management to manage the affairs of 1st Respondent Company; (ii) To direct the Central Government to appoint Inspector(s) to investigate into the affairs of 1st Respondent Company; (iii) To order removal of Board of Directors and appoint such number of persons as may be deemed fit and proper to hold office as independent Board of Directors to assume charge of the management and affairs of the 1st Respondent Company; (iv) To pass an order restraining the Respondents No. 2 and 3 and their servants, agents and assigns, by a permanent order and injunction from increasing the share capital or allotting any new shares or creating any liability over the assets of the 1st Respondent Company.;