AMMONIA SUPPLIES CORPORATION PRIVATE LIMITED IN LIQIUDATION Vs. MODERN PLASTIC CONTAINERS PRIVATE LIMITED

JUDGEMENT

(1.) Originally this pctition was filed undcr Sections 397 & 398 read with Section 155 of the Indian Companies Act, but under (he orders of the Court the petition was allowed to be confined to the reliefs which may be available to the petitioner under Section 155 of the said Act.

(2.) The petitioner-company is in liquidation since December2.1,1962.1 would refer to only such pleadings which are necessary pertaining to the provisions of Section -155 of the Companies Act. It was averred in the petition that the petitioner-company vide letter dated January 3. 1977. had sent a sum of Rs.l.20,500.00 to Sh. Vipan Kumar Bhargava (since died), the director of the respondent-company and this money was sent for purchasing shares of the respondent-company and similar letter dated January 3, 1977. was also issued and so also letter dated February 21. 1977. It was averred that Sh. O.P. Bhargava s/o Sh. Murari Lal Bhargava was closely related to Sh.V.K. Bhargava as their wives were real sisters and due to this close relationship Sh.V.K.Bhargava in 1970 informed that his group of shareholders wanted to get rid of Mitlal Group of shareholders in the respondent- company as the joint functioning was not proceeding well and it was the desire of late Sh.V.K. Bhargava that the respondent-company be held as a closely knit Bhargava Family Company and Sh.V.K.Bhargava had desired in his lifetime that Sh.O.P.Bhargava should be 50% partner in the respondent-company and thus, it was decided that instead of Sh.O.P.Bhargava becoming shareholder of 50% in the respondent-company, the petitioner could purchase the shares belonging to Mittal Group and thus, the petitioner- company had sent the aforesaid amount to Sh.V.K.Bhargava for purchse of shares of the respondent-company in the name of the petitioner-company. It is averred that after the death of Sh.V.K. Bhargava. respondents 2 & 3 started disputes with regard to petitionercompany's share holding in the respondent-company and some admission is staled to have been made by Sh.R.R.Bhargava in his lelicr daled May 28, 1984, regarding the pelitioner- company being entitled to shareholding of 50% in the respondent-company. Then reference is made to some 25 letters written by Shri Murari Lal Bhargava and Sh.R.R.Bhargava. It was pleaded that 1265 shares belonging to Mittal Group were tobe transferred in the name of the petitioner-company in the records of the respondent- company but due to fraudulent intentions the same was not done. The alternate pica taken is that Sh.V.K.Bhargava had no funds to acquire the said 1265 in January & February 1977 and i( be held that Sh.V.K.Bhargava held those shares Benami for the benefit of the petitioner-company. It is then averred that the respondent-company had allotted 470 shares i.e. 265 and 205 shares to respondents 2 & 3 respectively which had disturbed the share ratio of 50:50 between the petitioner-company and the Bhargava Group of shares and such allotment could not have been made which is in violation of Articles of Association of the respondent-company. So it was prayed by the petitioner- company that this court should declare that 470 shares allotted over and above 2530 shares to respondents 2 & 3 are null and void and it should be held that the petitioner-company is having share-holding of 1265 in the petitioner-company and necessary rectifications be made in the register of members of the respondent-company.

(3.) In the reply respondents 1-4 have vehemently contested the petition pleading that serious dispuled questions offacts arc involved in the matter and this court should not exercise its summary,jurisdiction under Section 155 of the Companies Act. It was also pleaded that the petition filed in 1984 is hopelessly barred by limitation as it refers to some alleged transactions which look place in the year 1977. It is alleged that the petitioner had advanced a sum of Rs. l,26,500.00 to late Sh. V.K.Bhargava and (hat recovery of the loan having become time-barred the present petition has been filed as a device and contrivance to pressurize (he heirs of late Sh.V.K.Bhargava to pay the said amount. It is averred (hat no such amount had been paid to respondent No. 1-company by the petitioner-company and at no point of time the petitioner-company had become entitled to have any shares of respondent No, 1-company. It was averred that the shares of respondent No. 1-company could be transferred only with the permission of the Board of Directors and in case any shareholder wishes to transfer his share he has to first offer the same to the other shareholder and on such offer being not accepted, then the shares could be transferred to some oilier person, It was pleaded that Mittal Group which had only shares in the name of their close relations offered to transfer shares to Sh.V.K.Bhargava which transfer was duly accepted by the Board of Direclors. So, there could arise no occasion for offering any shares for sale to the petitioner-company. It was also pleaded that the company, which is in liquidation, in law is not entitled to purchase shares of any other company. It was averred that no fresh shares were issued by respondent No. 1-company which could be acquired by anyone and money was not given to respondent No. 1-company by the petitioncr-company at any time and it is falsely alleged that petitioner had sent any money to respondent No.1-company for purchase of shares. It was pleaded that letters referred in para 8 of the petition have never been received by the respondents. It was denied dial the petitioner-company is having 50% shareholding in respondent No.l-company. It was averred that rather the petitioner- company does not hold any single share in respondent No. 1 -company. It was pleaded that the said transaction of advancing a sum of Rs.l,26,500.00 to Sh.V.K.Bhargava by Sh. Murari Lal Bhargava or by the petioner-company, was a private transaction between them and respondent No.l-company has nothing to do with the same. It was pleaded that Mittal Group had sold and transferred 1265 shares in favour of Sh.V.K.Bhargava and documents were duly executed in that regard and the share certificates were given to respondent No.1-company for transferring the same in the name of Sh.V.K.Bhargava and the Board of Directors in its meeting dated February 3, 1977,rccordcd its permission in this regard and the three directors of Mittal Group put in their resignation which was duly communicated to all the authorities including the Director of Industries, U.P..Kanpur. Branch Manager, State Bank of India, Meerut and the Manager. National Small Industries Corporation Limited. It was pleaded that the shares purchased by Sh.V.K.Bhargava from Mittal Group had always been shown in the income-tax return of Sh.V.K.Bhargava as his personal assets, was pleaded that the petitioner has forged letter dated June 7, 1984, as such a letter was never issued by respondent No. 1. It was further pleaded that there is no entry in the books of accounts of respondent No.1-company pertaining to the sum of Rs.l,26.500.00 . It was also plcaded that Sh.R.R.Bhargava had nothing to do wilh respondent No. 1-company as he is neither (he shareholder of the company nor has any say in the affairs of respondent No.1-company. It was also pleaded that letter annexed as P-4 relied upon by the petitioner is a forged letter as such a letter was never written by Sh.Uma Raman. The locus standi of the petitioner to challenge the shares allotted to respondents 2 & 3 is also challenged.