VIJAYALALITHA Vs. STATE

JUDGEMENT

(1.) This writ petition was filed in the year 1999. Previously, the first Petitioner was the Chairman of a Multi-National Company known as "U.B. Group" and the other Petitioners were the Executives/Employees of the U.B. Group of Companies. In the year 1982, a Company called "Krest Development and Leasing Limited" was incorporated and registered before the Registrar of Companies, Chennai, under the provisions of Indian Companies Act. The U.P. Group of Companies, after following the relevant provisions of the Companies Act, acquired controlling interest in Krest Development and Leasing Limited and therefore, the said Company was renamed as "McDowell Crest Finance Limited" (fourth Respondent herein).

(2.) While so, according to the first Petitioner, because of his other pre-occupations in other businesses of U.B. Group and as he was also a non-resident Indian, he ceased to be the Director of the said Company even as early as on 20-3-1997 following the prescribed and requisite statutory formalities as laid down under the Companies Act. Similarly, according to the other Petitioners, they had also resigned as Directors in the fourth Respondent-Company by folllowing the prescribed statutory formalities. It is further alleged that the fact of resignation of the Petitioners have become effective and the same was also made known to all. Subsequently, the right to control and management of this company had accordingly vested with the group called "Rayudu Group" and the name of the fourth Respondent-Company was changed as "M/s. Krest Finlease Limited", it is contended.

(3.) While so, some complaints were filed by the depositors before the Company Law Board alleging that the deposits received from them by the said Company were not repaid to them. According to the Petitioners, in exercise of the power under Section 45QA of the Reserve Bank of India Act, the Company Law Board has issued certain directions in respect of repayment of deposits to the depositors. While so, many other depositors, who were not parties before the Company Law Board started filing complaints before various Consumer Redressal Forums under the provisions of the Consumer Protection Act, 1986, claiming repayment of deposits with interest and damages. According to Petitioners, several orders were passed against the Petitioners and the fourth Respondent-Company by the Consumer Forums and all such orders were ex parte orders. Based on the said ex parte orders, now execution proceedings have been initiated and it is stated that coercive steps, like even arrest, are also likely to be resorted to by the Consumer Forums at the instance of the beneficiaries of the orders passed by the Consumer Forums. In those circumstances, the Petitioners have come up with this writ petition seeking the following relief: