VIKRAM RAGHUVIR JASRA Vs. JASRA GRAPHICS PVT LTD

JUDGEMENT

(1.) THIS notice of motion taken out by the plaintiff. The plaintiff has filed this suit for a direction to the defendant Nos.2 and 3 to repay the defendant No.1 all sums paid by the defendant No.1 to defendant Nos.2 and 3 and make good all profits and benefits derived by defendant Nos.2 and 3. The plaintiff also challenges the validity of the Board of Directors meeting of the defendant No.1 - Company held on 16th August, 2000 and 21st August 2000. The bone of contention between the parties is the defendant No.3. According to the plaintiff, the defendant No.3 was an Additional Director appointed by the Board of Directors of the defendant No.1 company under the provisions of Article 123 of the Articles of Association of the Company. According to the defendant No.2, the defendant No.3 was not an Additional Director appointed by the Board of Directors pursuant lot the powers of the Board of Directors under Article 123, but he was a whole time Director appointed by the General Body of the Company in the year 1977. Therefore, there is no question of his retirement at the Annual General Meeting of the Company. In support of their claim that the defendant No.3 was appointed by the Annual General Meeting, the defendant No.2 has produced a form submitted to the Registrar of Companies in the year 1977 which shows that the plaintiff, defendant No.3 and defendant No.2 were appointed as directors on the some day viz 1st May 1977. The defendant No.2 also relies on the notice of the General Body Meeting dated 14th April 1977 which shows that one of the items on the agenda of the General Body Meeting which was scheduled to be held on 30th April 1977 was appointment of defendant No.3 by the General Body as whole time Director/ Works Director of the Company. In so for as the plaintiff is concerned, except for showing a notice of the Annual General Body meeting of the year 1985, which shows that one of the item on the agenda of the Annual General Meeting was renewal of the appointment of defendant No.3 as Director, there is no other document produced.

(2.) THE learned counsel appearing for the plaintiff submits that the defendant No.3 was appointed as an Additional Director in the year 1977. He also submitted that he was appointed from time to time as Additional Director by the Board of Directors, however, in the Annual General Meeting held in the year 2000, his appointment was not renewed and therefore, in December 2000 when the meeting of Board of Directors held in which the defendant No.3 participated, he was not a Director of the defendant No.1 - Company and therefore, the resolutions passed in the said meeting are illegal. According to the learned counsel appearing for the defendants, the defendant No.3 was not appointed by the Board of Directors as an Additional Director but he was appointed by the General Body Meeting of the defendant No.1 - Company which is evident from the document filed by the defendants which is the form submitted to the Registrar of Companies. The learned counsel for the defendants however submits that he cannot produce original of the resolution of the General Body Meeting because proceeding book of the meeting is missing. He however submits that he has produced enough material to prima facie establish before the Court that the defendant No.3 was not appointed by the Board of Directors but was appointed by the General Body Meeting. The learned Counsel further submits that the defendant No.1 is a Private Limited Company wherein shareholding of the plaintiff is only 6% whereas the shareholding of the defendant No.2 is 74% and together with mother, who is supporting him, he holds 94% of the share Capital of the defendant No.1 - Company and therefore, this Court should not, at this stage interfere with the internal management of the defendant No.1 - Company by passing orders which are essentially in the discretion of this Court considering especially the shareholding of the defendant No.2.