Rajeswara Rao Vittanala, Member - (1.) The present Company Petition bearing No. C.P. No. 91/59/HDB of 2017, is filed by Punjab Agro Industries Corporation Limited (Petitioner Company) against Omega Ag Seeds Punjab Limited & 02 others, under section 59 and other applicable provisions of the Companies Act, 2013, by inter-alia, seeking following reliefs:- (a) Order may please be given to R-1 to ratify the Register of Members by deleting the name of the petitioner as shareholder/members qua 780000 equity shares of Rs. 10/- each. (b) Order may please be given to R-1 to refund the Share Application Money of Rs. 78 lac lying sacrosanct in the account No. 35 and Fixed Deposits being maintained with R-3 along with statutory interest and if the amount standing in the account and FDs doesn't accomplish the payment along with statutory interest, the balance amount may please be ordered to be paid by Respondent No. 1 (c) Order may please be given to R-1 to re-shift the registered office of the company from the State of Andhra Pradesh to the Union Territory of Chandigarh till produce high quality hybrid seeds in india, and would also im[art training to indian Technicians to carry out all aspects of plant breeding, seed production and peocessing etc. the full & final payment of Share Application Money along with statutory interest of the petitioner is paid by Respondent No. 1
(2.) Brief facts, in respect of this case, which are relevant to the issue in question, are as under:- (1) Punjab Agro Industries Corporation Limited (herein after referred to as Petitioner/Corporation) a Punjab State Govt. Company having CIN: U51219CH1966SGC002630 was incorporated on 11.02.1996, having its registered office at Plot No. 2A, Sector 28A, Madhya Marg, and Chandigarh. It is a Government Company registered in the Union Territory of Chandigarh, and its main objective is to promote Agro based industries in the State of Punjab by extending technical and financial assistance to interested parties to do so. (2) Omega Ag Seeds Punjab Limited (OSPL), (hereinafter referred to as Respondent No. 1) was incorporated on 24.11.1992 having its registered office at SCF 340, Near Dhillon Complex, Manimajra, Mansa Devi Road, Chandigarh, in which the petitioner has subscribed 300 equity shares of Rs. 10/- each, and a Certificate of Commencement of Business was obtained from the Registrar of Companies, Punjab, H.P. & Chandigarh at Jalandhar on 17.12.1992. (3) M/s. Omega AG Seeds (India) Limited (Collaborator) herein after referred to as Respondent No. 2) has approached the Petitioner (Corporation) and projected that it had a license from Ag Seeds PTY Limited, a company based in Australia, and thus, asserts that it is capable of getting all necessary advance technology to produce high quality hybrid seeds in India, and would also impart training to Indian Technicians to carry out all aspects of plant breeding, seed production and processing etc. (4) Accordingly, a Financial Corroboration Agreement (which is herein referred to as FCA/Agreement) executed on 22.10.1992 between Punjab Agro Industries Corporation Limited (Petitioner herein) and Omega Ag Seeds (India) Limited (Respondent No. 2 herein). (5) That Respondent No. 1 floated a Public Issue of Rs. 3,00,00,000/- (Rupees three crore) divided into 3000000 (Thirty Lac) equity shares of Rs. 10/- each for cash at par in terms of prospectus dated 11.04.1994, which was opened for subscription on 16.05.1994 with an earliest closing on 19.05.1994 and closing not later than 26.05.1994. (6) That in terms of FCA, the Petitioner advanced a sum of Rs. 80.00 Lacs as Share Application Money (as per the details given here below) towards the equity of Respondent No. 1, which was deposited in a separate Bank Account No. 35 with India Overseas Bank i.e. Respondent No. 3, with an understanding that the amount shall be used for purposes as mentioned in the FCA Only. Out of the above Rs. 80 lac, shares of Rs. 2,00,000/- have already been allotted to the petitioner. (7) That on 06.06.1994, Respondent No. 1 issued a notice along with agenda for convening of the Board Meeting on 13.06.1994, which was actually held on 14.06.1994 vide revised notice dated 07.06.1994 at the office of the petitioner at Chandigarh and attended by all the directors except Mr. I.S. Sekhon, Nominee Director of the petitioner. The agenda of the Board Meeting was carrying following items along with other items: • ITEM No. 2 : To confirm the Minutes of the last Board Meeting held on 11.04.1994 • ITEM No. 4 : Allotment/Devolvement of Shares • ITEM No. 9 : Allotment of Equity Shares of Rs. 10/- each to Punjab Agro Industries Corporation Limited, Chandigarh So it is averred that shares cannot be allotted before slated Board meetings and those shares with back dating is false and void ab-initio. (8) It is stated that Respondent No. 1, in order to take away the funds of the petitioner deposited with Respondent No. 3, has filed CWP No. 17403 of 1994 with Hon'ble High Court of Punjab & Haryana, which was dismissed on 02.12.1994. After dismissal. of CWP No. 17403, Respondent No. 1 has filed a Civil Suit No. 20 of 1994 and obtained an ex-parte injunction on 02.12.1994 without impleading the petitioner as a party, and instead sought injunction against the nominee Directors from interference in the operation of the Bank account. However, luckily the petitioner came to know about this and immediately on 03.12.1994, moved an application for vacation of the injunction order. As the matter was being delayed, Respondent No. 1 has tried to get the amount encash, even though; it had no right to claim the same for violating the terms of FCA, which were binding on it. Thereafter, an appeal was filed on the same date on 03.12.1994, and the Learned District Judge was pleased to stay the operation of the order, and thereafter, the appeal filed was accepted and the revision against the said order was also dismissed by the Hon'ble High Court of Punjab and Haryana. Finally, the Civil Suit No. 20 dated 19.01.1995 was dismissed on 25.4.1995. (9) That in utter violation of the FCA, the Respondent No. 1 changed the Clauses 129(a) of AOA regarding equal number of directors and 159(1) of AOA regarding appointment of Chairman of the petitioner in the Extraordinary General Meeting (EGM) held on 29.12.1995, which was issued on 04.12.1995 delivered on 27.12.1995 i.e. one day before the date of EGM. The notice dated 04.12.1995 has come as surprise to the petitioner as no notice of Board Meeting was ever conveyed to the petitioner or its nominee directors in which the alteration of MOA & AOA was discussed and decided. This clearly shows the mala fide intention of the R-1 to avoid the presence of the petitioner as the R-1 was going to alter the Articles of AOA in utter violation of the FCA without the knowledge and consent of the petitioner. (10) That after the aforesaid incidents, the Board of Directors of Respondent No. 1 convened the Board Meeting on 29.04.1996, and resolved to approve the cancellation of FCA by the petitioner vide its Letter No. PAIC/P & H/96/191 dated 25.04.1996 under clause 39(b) of FCA, which provides that FCA may be cancelled at any stage if the petitioner is not satisfied with the progress of the project. In view of the aforesaid cancellation, the Board of Directors has also resolved to refund the share application money as the progress of Respondent No. 1 was not satisfactory due to the series of events taken place in the case. Hence, the resolution passed for cancellation of FCA makes the FCA non-est in the eyes of law. (11) That Respondent No. 1 immediately on coming to know about the Board resolutions regarding cancellation of the FCA, and to refund of share application money, showed the shares as allotted on back dates and sent the same to the petitioner on 21.08.1996 i.e. after a gap of two years from the date of deposit of share application money as per the following details: (12) That the decision of the Board of Directors of R-1, regarding cancellation of FCA, was conveyed to Respondent No. 3 immediately on 30.04.1996, but it refused to carry out the directions of the Board of Directors of Respondent No. (13) That being aggrieved by refusal of Respondent No. 3 for refund of money in the light of the cancellation of Financial Collaboration Agreement, petitioner has filed civil suit No. 154 of 98 on 04.05.1998 before the Court of Junior Judge, Chandigarh for declaration to the effect that the amount lying deposited in Current Account No. 35 with Respondent No. 3 bank belongs to it, and further grant mandatory injunction directing Respondent No. Bank to release the amount deposited along with all accrued interest thereon and further restrain Respondent No. 1 from interfering in the refund of amount. (14) That Defendant/Respondent No. 1 filed its written statement on 28.04.1999 denying the allegations levelled against it. On the same day, it has also filed an application under Order VII Rule 11 CPC for rejection of plaint of the petitioner by affirming that since the refund of money amounts to reduction of share capital, which is barred by Section 100 of the Companies Act, 1956, and the amount mentioned in the plaint was undervalued/under stamped, the plaint was liable to be dismissed. Whereas, since the shares were never allotted to the petitioner, the amount of Rs. 78.00 lakhs paid by the petitioner as share application money is lying with R-3 sacrosanct, it doesn't fall with the ambit of Order VII Rule 11 CPC. (15) That on 02.08.1999, the Petitioner filed its reply to the application under Order VII Rule 11 CPC of R-1 denying the frivolous allegations made in the applications. (16) That on 20.10.1999 R-1 filed rejoinder to the reply of petitioner in application under Order VII Rule 11 CPC. (17) That on 18.04.2001, the learned Civil Judge (Jr. Divn) erroneously dismissed the suit of the petitioner and allowed the application of R-1 under Order VII Rule 11 CPC. (18) That on 13.03.2002, the Petitioner challenged the said order dated 18.04.2001 of the learned Civil Judge (Jr. Divn) before Learned Addl. District Judge, Chandigarh in MCA No. 17 of 2001. The Ld. Addl. District Judge, Chandigarh vide his final judgment and order dated 13.03.2002 was pleased to dismiss the same. (19) That on 31.10.2002, being aggrieved, and petitioner filed Civil Revision No. 2882/02 before Hon'ble High Court of Punjab and Haryana at Chandigarh challenging the order dated 13.03.2002 passed by Ld. Addl. District Judge, Chandigarh. The Hon'ble High Court vide its interim order dated 31.10.2002 was pleased to direct R-1 and the petitioner to maintain status quo with respect to the subject amount. (20) That the Hon'ble High Court, after almost 11 years, vide its order dated 03.09.2013, was pleased to dismiss the Civil Revision Petition No. 2882/02 filed by petitioner herein. (21) That on 25.09.2013, being aggrieved, and the petitioner filed SLP (C) No. 30570/2013 before Hon'ble High Court. The Hon'ble High Court vide its order dated 25.09.2013 was pleased to dispose of SLP of petitioner by giving liberty to the petitioner to file Revised Second Appeal (RSA) before Hon'ble High Court and directed to maintain status quo upon the subjected property and further directed that the delay be condoned. (22) That on 21.10.2013, the petitioner accordingly filed RSA No. 4144/2013 before the Hon'ble Division Bench of the High Court of Punjab and Haryana at Chandigarh. (23) That on 22.10.2013, the Hon'ble High Court, vide its order dated 22.10.2013, was pleased to condone the delay in filing RSA and directed parties to maintain status quo regarding the amount in question. (24) That on 20.05.2015, the Hon'ble High Court, vide its impugned judgment and order was pleased to dismiss the RSA No. 4144/2013 filed by the petitioner herein whereby the orders passed by the courts below have been upheld raising immediate apprehension of withdrawal and appropriation of subject amount running into approximately Rs. 2.25 Crore which is public money. (25) That on 01.06.2015, the petitioner filed Special Leave Petition No. 16824 of 2015 with the Hon'ble Supreme Court against the final impugned judgment and order dated 20.05.2015 passed by the Hon'ble High Court of Punjab & Haryana at Chandigarh in RSA No. 4144/2013. (26) That the Hon'ble Supreme Court on 21.04.2017 dismissed the Special Leave Petition granting Liberty to the Petitioner to approach the NCLT within a period of one month. Hon'ble Supreme Court also ordered that in case application is filed in NCLT; let it be dealt with as expeditiously as possible preferably within six months. Hon'ble Supreme Court also mentioned in its order that interim order granted by this court on 08.07.2015 shall continue till the matter is considered by the NCLT. (27) That the present case does not involve the reduction of share capital because the shares were never allotted against the share application money of the petitioner amounting to Rs. 78.00 Lac. (28) That the petitioner has been wrongly shown as shareholder/member of R-1 qua 780000 shares of Rs. 10/- each as these shares were never allotted to the petitioner and the money contributed by the petitioner, being a State Government company, is a public money is still lying in a separate bank account sacrosanct being maintained with R-3 and has been converted into fixed deposits from time to time on the orders passed by the Hon'ble Courts.
(3.) Heard Mr. Vishawjeet Gupta, PCS along with Mr. Ravi Gupta, Manager, Punjab Agro Limited for the Petitioner, and Mr. Gaurav Goel, Learned counsel for Respondent No. 1 and Mr. Nitin. M. Parekh, learned counsel for the Respondent No. 2, and I have carefully perused all the pleadings along with material papers filed in their support and extant provisions of Companies Act, 1956/2013.;