G KASTURI Vs. N MURALI

JUDGEMENT

(1.) ONE set of appeals by G. Kasturi, the managing director of Kasturi and Sons Ltd., as well as the company, Kasturi and Sons Ltd., and another set of appeals by Dr. Nalini Krishnan are preferred against the order disposing of three company applications, bearing Nos. 342, 343 and 344 of 1990, in Company Petition No. 36 of 1990, filed by respondents Nos. 1 to 3 herein. The respondents, N. Murali, N. Ram and Mrs. G. Narasimhan, have filed the said company petition under sections 397 and 398 of the Companies Act, 1956 (hereinafter referred to as "the Act"). The petitioners in the company petition have stated that the first petitioner holds 540 equity shares of Rs. 100 each in the capital of the company, while the second petitioner holds 3, 800 equity shares of Rs. 100 each.

(2.) THE third petitioner is a shareholder of 1, 186 equity shares of Rs. 100 each. THE nominal capital of the company is Rs. 100 lakhs divided into 1, 00, 000 equity shares of Rs. 100 each and the issued, subscribed and fully paid-up capital of the company is Rs. 88 lakhs divided into 88, 000 equity shares of Rs. 100 each. THEy have also stated that they have the consent of the members of the company entitled to apply under section 399(1) of the Act, holding an aggregate of 9, 260 shares of Rs. 100 each in the capital of the company for presenting the company petition. A letter of consent signed by the members so entitled authorising the petitioners to present the petition on their behalf is annexed to the petition. THE first petitioner/respondent has been the general manager of the company since July, 1977, and is a director of the company since 1980. THE second petitioner/respondent was the director of the company during the period from 1977 to 1980 and is at present an associate editor of THE Hindu, a newspaper belonging to the respondent/appellant company.

(3.) ACCORDING to the petitioner/respondents, as part of the family arrangement and understanding, the shareholding in the company was to be equally held by the four descendant families of the original promoters of the company, viz., Kasturi Srinivasan and Kasturi Gopalan, but the family of the first respondent, the first appellant in O. S. A. Nos. 80 to 82 of 1990 (one of the appellants before us) has consistently been postponing the effect of the settlement in respect of the petitioners'/respondents' family by unlawfully retaining and refusing to transfer to the petitioners 1.6% of the shareholding in the company held by the family of the first respondent in excess of 25% to which alone they are entitled. The shareholding of the company as per the register of members is as follows :'Petitioners' family 23.4% Family of the first respondent 26.6% Family of the second respondent 25% Family of Mr. S. Rangarajan 25% (Wholetime director and publisher)