JIJI ANTONY Vs. JRG SECURITIES LTD.

JUDGEMENT

(1.) This company appeal is lodged against the order dated 11th October, 2010 in CA No. 92 of 2010 in CP No. 44 of 2010 Jiji Antony v. JRG Securities Ltd.,2011 101 CLA 410 by the Chennai Bench of the Company Law Board.

(2.) The briefly put, the case of the Appellants is as follows : The Appellants are the Petitioners in CP No. 44 of 2010. They are the original promoters of the first Respondent-company. The first Respondent-company is incorporated under the Companies Act, 1956 ('the Act') and it is a public limited company. It is a listed public company and it is engaged in equity, commodity and insurance broking business. Appellant Nos. 1 to 3 are the original promoters of the company. Respondent No. 2 is a financial investor. The second Respondent had agreed to subscribe 1,03,82,174 equity shares of Rs. 10 each at a premium of Rs. 38 per share. Annexure A2 is the agreement between Appellant Nos. 1 to 3 and the second Respondent. The Appellants filed a company petition under Sections 397 and 398 of the Act. The Appellants also filed an application seeking interim injunction (annexure A14) feeling aggrieved by the decision of the company to raise capital. Various other acts are allegedly the subject-matter of the petition. The Company Law Board ('CLB') initially granted injunction dated 6th July, 2010. The CLB directed that the Respondents shall not proceed with the rights issue without the leave of the Bench. Subsequently, by the impugned order the CLB has vacated the said injunction and permitted the first Respondent-company to proceed with the rights issue. The first Respondent was permitted to proceed with the rights issue as resolved in the Board meeting on 25th May, 2010. It is also observed that the above order is subject to the final outcome of the company petition. The Respondents were directed to file counter within four weeks.

(3.) The case of the Appellants is essentially based on Article 157A of the articles-of association of the company.