NAGESH KUMAR Vs. NAGESH HOSIERY EXPORTS LTD

JUDGEMENT

(1.) This appeal under Section 10F of the Companies Act, 1956 ('Act') is directed against a judgment dated 11th June 2008 passed by the Company Law Board ('CLB'), Principal Bench in Company Petition No. 97 of 2006 filed by Appellant 1, Mr. Nagesh Kumar and his wife Appellant 2, Mrs. Renu Mehra.

(2.) The background to the present appeal is that Respondent 2 Mr. Vidya Prakash Mehra, is the father of Appellant 1 Nagesh Kumar, Respondent 3 Mr. Ravinder Kumar and Respondent 4 Mr. Rakesh Kumar. Respondent 2, along with his brother Mr. Dharam Pal was running a partnership firm in the name of M/s. Nagesh Hosiery Mills ('NHM'). As a result of disputes between the partners, a deed of dissolution was executed by them on 30th July 1983. Under the dissolution deed, inter alia, the immovable property being building No. B-1-1214 near Kailash Cinema Chowk in Civil Lines, Ludhiana was divided into two parts. One part was allotted to the parties of the 4th, 5th and 6th parts i.e. Mr. Ashok Kumar, Mr. Rajan Kumar and Mr. Mukesh Kumar sons of Mr. Dharam Pal. The other portion was given to the parties of the 1st, 2nd and 3rd parts i.e. Mr. Ravinder Kumar, Mr. Nagesh Kumar and Mr. Rakesh Kumar. Likewise, another immovable property being a building at GT Road, village Bhaura, Ludhiana was divided into two parts and distributed to the two sets of parties. The relevant clause in this regard reads as under:

(3.) The Respondent 1 company Nagesh Hosiery Exports Limited ('NHEL') was incorporated in 1980 with its registered office in Greater Kailash, New Delhi. Appellants 1 and 2 Nagesh Kumar and his wife Renu Mehra, held 40,940 equity shares in NHEL. This represented 20.47% of the 1,99,500 paid up equity shares of Rs.10 each of NHEL. 25,950 shares were held by Mrs. Suhag Rani, the mother of the Appellant 1 and Respondents 3 and 4. 22,600 shares were held by Respondent 2 Mr.Vidya Prakash Mehra as Karta of the Hindu Undivided Family ('HUF') comprising of himself and his sons. The other shareholders included Mr. Nagesh Kumar who holds 27,750 shares, Mrs. Renu Mehra who holds 13,190 shares, Mr. Ravinder Kumar who holds 25,750 shares, Mr. Rakesh Kumar who holds 30,100 shares, Mrs. Charu Mehra, Respondent 5 and wife of Mr. Ravinder Kumar, who holds 15,189 shares and Mrs. Sudha Mehra, Respondent 6 and wife of Mr. Rakesh Kumar, who holds 10,840 shares. In terms of the annual return filed by NHEL with the Registrar of Companies ('ROC'), Mrs. Shammi Sobti holds 17,290 shares and Mr. Om Prakash Khanna holds 50 shares.