RASOI LIMITED Vs. JAIDEEP HALWASIYA

JUDGEMENT

(1.) THIS is a petition filed under Sections 247/250 of the Companies Act, 1956 (the Act) by M/s. Rasoi Limited (the company) seeking for the following reliefs: (a) Declaration by an order that the membership of respondent Nos. 1 to 27 in the company are to be investigated for the purpose of determining the true persons who are or have been financially interested in the success or failure, whether real or apparent, of the company; (b) To order an investigation by the inspectors of the circumstances which suggests the existence of arrangement and understanding between the respondents in connection with the acquisition of shares of and in the company by the respondents. By way of interim relief, the petitioner has also sought for an order restraining the respondents from dealing with or transferring the shares held by them in the company in any manner and also for restraining them from exercising voting rights.

(2.) THE facts of the case arc: The company has earlier filed a petition under Section 111A of the Act seeking for rectification of the register of members of the company to remove the names of respondents 1 to 16 on the ground that they had, by acting in concert, acquired shares in the company in violation of the provisions of SEBI (Substantial Shares Take Over) Regulations, 1999. In that petition I passed an order on 14.11.2006 that any further acquisition of shares by the respondents would be subject to the final order on the petition. However, I declined to pass an order of restraint against the respondents from transferring their shares impugned in the petition. The said petition is pending disposal. During the pendency of the said petition, some of the respondents therein had transferred their shares to respondents 18 to 27 herein. The company has filed the instant petition thereafter. At the time of mentioning the petition, in terms of Section 250(2) of the Act, the petitioner sought for restraining the respondents from transferring their shares and accordingly, I passed an order on 12.7.2007 directing the respondents to maintain status quo with regard to their shareholdings in the company. Thereafter, the matter was heard on 26^th & 27^th July, 2007 and an order was passed on 18^th August, 2007 vacating the restraint orders in so far as the respondents 18 to 27 are concerned, but the order against other respondents was continued till the disposal of the petition. Aggrieved by the said order, the 1^st respondent filed an appeal before the Calcutta High Court which has directed this Board to consider the prayer of the respondents for modification of the said order. Instead of considering the prayer for modification, I decided to hear the petition finally and accordingly concluded the hearing on 25.1.2008.

(3.) THEREFORE , the company has invoked the provisions of Section 247/250 of the Act to find out the relevant facts about the shares. The promoters hold about 55% shares and are in the management of the company. Therefore, it is essential to know as to why suddenly, during a short period, nearly 21% of shares have been acquired by the respondents. An averment has been made in the petition that the 1^st respondent had approached the Vice Chairman of the company indicating that he was controlling 21% shares and offering the same to be purchased by the promoters. In the reply of the 1st respondent to the petition under Section 111A, there is no denial to this averment. However, only in the reply to the present petition, he has denied. In terms of the provisions of Section 247(1A)(a) of the Act which the petitioner has invoked, it is necessary to find out as to who are or have been financially interested in the success or failure whether real or apparent, of the company. The very fact that the respondents 2 to 17 impleaded themselves in the suit filed by the 1^st respondent to support his case would indicate that they are all acting in concert. The motive of the respondents acquiring 21% shares in a short span of time has to be found out especially since the company is a listed company. Further, this investigation would also be in the aid of the petition under Section 111A of the Act. An investigation under Section 247(1A) does not adjudicate any issue and is only a fact finding enquiry. The petitioner has given enough material to indicate that there is connection among all the respondents. In a number of cases, this Board has held that a petition can be filed in terms of Section 250 to find out fuels about shares and in that proceeding, recourse to Section 247 can be taken. Since the respondents are likely to further transfer their shares, as it has happened already, restraint order passed earlier should be continued, failing which more and mote parties might have to be impleaded to establish interconnection.