PALANISAMY Vs. MILKA NUTRIENTS P. LTD.

JUDGEMENT

(1.) CHALLENGE in this appeal is to the order/interim order dated January 11, 2008, passed by the Additional Principal Bench, Company Law Board, Chennai, in C.P. No. 5 of 2008.

(2.) THE dispute is in respect of 'Milka Nutrients' incorporated as a company under the name and style of M/s. New Hope Food Industries P. Ltd., which is engaged in the business of manufacturing and supplying of cakes under the brand name 'Milka Wonder Cake'. Alleging acts of mismanagement and oppression, the appellants, who are also the directors of the company has preferred C.P. No. 5 of 2008. In the said company petition, the appellants sought to restrain the respondents from conducting and holding the proposed extraordinary general meeting of the company scheduled to be held on January 12, 2008. The Company Law Board ('CLB') by its order dated January 11, 2008, had granted the liberty to the first respondent -company to convene the extraordinary general meeting after serving notice to the appellants by registered post with acknowledgment due. The Company Law Board further observed that the first respondent -company cannot implement any of the resolutions without leave of the Board, save and except the bank operation by the second respondent. The grievance of the appellants in respect of Clause (ii) of the impugned order, which reads as under: (ii) Any resolution which may be passed at the meeting which may be convened in terms of this order, will not be implemented without leave of this Bench, save in the matter of operation of the bank account by the managing director, in the light of his authority as envisaged in Clause 41 of the articles of association of the company. In the event of the managing director is authorized to operate the bank account solely, he shall furnish to the petitioners, a statement of the bank account every fortnight.

(3.) LEARNED Counsel for the appellants Mr. R. Murari has submitted that when serious mismanagement and oppression is alleged against the second respondent, he cannot be allowed to operate the bank account and the practice so far hitherto in vogue, viz., joint operation of the bank account has to be continued.