C V PARDHANANI Vs. M B PARDHANANI

JUDGEMENT

(1.) This petition purports to be under Sec 398 of the Companies Act ('the Act', for short) seeks the following reliefs against the respondent:

(2.) According to the petitioners, the respondent who was the Managing Director of the 3rd petitioner company, resigned fro'm the office of Managing Director in May 1987 and (hereafter did not attend any of the Board's meetings. Subsequently an extraordinary General Body Meeting, was convened to remove him from the office of Director; meeting was scheduled to be held on 21-12-1987, but was not held in view of a Civil Court's order. The share holding of the respondent is only 1.28 percent which he holds in trust and for the benefit of the 2nd petitioner. The application for temporary injunction was subsequently withdrawn in the Civil Suit and in the adjourned meeting held on 18-1 -1988, respondent was removed from the office of the Director. The present petition was filed on 27-8-1988. The 1st petitioner is the Director and Chairman of the Company. The Company was impleaded as the 3rd petitioner, subsequently; originally it was not impleaded as a party. The petition proceeds on the clear assumption that petitioners 1 and 2 hold the controlling interest in the company and the respondent ceased to be in charge of the company's management and its affairs. Several acts of commission and omission are alleged against the respondent while he was allegedly in control of the affairs of the company and was its Managing Director. In view of these misfeasance committed by the respondent, the company is alleged to have suffered huge loss.

(3.) It is not necessary to refer to the details given in the petition. The respondent, however, has denied the allegations made against him; on the other hand, he attributes several acts of omissions to the 1st petitioner, resulting in loss to the com pany; he further asserts, that the 1st petitioner has been guilty of enriching himself at the costs of the company.