M. VENKATARAMAN Vs. SEVEN H. LOGISTICS PRIVATE LIMITED

JUDGEMENT

(1.) Heard the learned Counsel for the petitioner and the learned Counsel for the respondent. The petitioner is a management professional and the respondent is a private limited company. It transpires that the Managing Director of the respondent-company and the petitioner were friends. However, the petitioner is said to have entered into an agreement with effect from 1-12-2011. The petitioner was said to have been inducted into the Board of Directors as a whole time Director with a remuneration of Rs. 10,00,000/- per month. In terms of the agreement, he was to have been paid Rs. 4,00,000/- per month initially upto the end of May 2012 and subsequently, he would be entitled to full remuneration as stated, along with arrears for the earlier period. The memorandum of understanding also provided that the petitioner would acquire 20% stake in the respondent in a phased manner and other benefits were also spelt out. It is claimed that the petitioner diligently worked for the company in terms of the arrangement and he was paid as salary from December 2011 to January 2012 at Rs. 4,00,000/- per month. However, he was paid only Rs. 2,80,000/- and it was informed that Rs. 1,20,000/- is adjusted towards the tax deduction at source. It was the petitioner's claim that he was not paid for the months of February 2012 to April 2012 by the respondent. There was exchange of correspondences in this regard and despite repeated demands, there was no payment. Under the arrangement, it was also agreed that the company was to have offered 10% of its share capital by 31-12-2011 and another 10% by 31st December, 2012. The valuation for the purpose of allotting the shares is said to have been Rs. 70,00,000/- for the 20% of the shares in the company irrespective of the dates of allotment. Under the arrangement, it also provided that an initial 10% was to have been paid to the petitioner in installments. This was never forthcoming and it is in this background that the petitioner had issued a statutory notice after other modes of exchange of notices failed to evoke any positive response from the respondents, under Section 433(e) read with Section 434(1)(a) of the Companies Act, 1956.

(2.) The learned Counsel for the petitioner however would insist that insofar as the initial payment of Rs. 4,00,000/- per month, was unconditional and the fact that the respondents have paid Rs. 4,00,000/- per month upto January 2012 would indicate that it is not disputed and they were liable to pay the said sum upto May 2012. It is not the case of the respondent that the petitioner did not continue to perform in terms of the arrangement, till May 2012.