IN RE: HIMACHAL FIBERS (P.) LTD. Vs. STATE

JUDGEMENT

(1.) ARGUMENTS were heard on CA No. 243/2012 filed by the company Himachal Fibres Ltd. (R -1) and CA No. 244/2012 filed by R -16 Garg Fincap Ltd. for dismissal of the petition on the ground that the petitioners do not satisfy the criteria under section 399 of the Companies Act, 1956 ('the Act') for filing a petition under sections 397 and 398 of the Act. Petitioner Nos. 1 to 4 filed CP No. 53(ND)/2012 giving details of their equity shareholding in R -1 as under:

(2.) COUNSEL for the petitioners argued that the petitioners satisfy the criteria under section 399 of the Act as they hold 19.18 per cent of the issued equity share capital of R -1 company. It was contended that a preferential shareholder is not concerned with the affairs of the company as his voting rights are limited to only such resolutions placed before the company which directly. affect the rights attached to such preference shares. A preference shareholder not only has a preferential right to dividend but also to repayment of capital in case of winding up of the company. Therefore, under section 399 of the Act the legislative intent must be held to exclude the preferential share capital of the company from the purview of the words "issued share capital of the company.

(3.) LEARNED counsel appearing for the petitioners argued that the equity share capital held by the petitioners would satisfy the required criterion under section 399 of the Act if it was held that the words "issued share capital" includes only the equity share capital of the company. Learned counsel contends that an SLP has been preferred before the Supreme Court of India against the judgment of the Bombay High Court in Northern Projects Ltd. (supra) which is listed for detailed consideration on 25th July, 2012. It was prayed that till the SLP was decided, the CP No. 53/2012 be kept pending and interim order passed on 10th April, 2012 be continued.