TADI ADINARAYANA REDDY Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner seeks an appropriate writ declaring the inaction on the part of respondents Nos. 1 and 2 to take necessary action against respondents Nos. 4 and 5 for their acts of omission and commission as arbitrary and illegal and for a consequential direction to respondents Nos. 1 and 2 to forthwith direct prosecution of respondents Nos. 4 and 5 in accordance with law.

(2.) The petitioner claims to be a joint shareholder along with his maternal uncle, Sri Nallamilli Venkata Reddy. The petitioner along with other family members claims to own 3,723 equity shares in the third respondent company which is incorporated under the Indian Companies Act. The case of the petitioner is that the third respondent company is a public limited company and respondent No. 4 is the chairman and managing director whilst respondent No. 5 is the joint managing director of the third respondent company. It is averred that respondents Nos. 4 and 5 illegally siphoned off monies and through their agents, formed three benami firms which were raided by the income-tax authorities and the amounts recovered from the said firms are said to be the amounts diverted by respondents Nos. 4 and 5. Several acts of omissions and commissions have been listed in the affidavit filed in support of the above writ petition apart from attributing mismanagement and misappropriation of the funds of the third respondent company. It is further averred that the share capital was increased, yet the production and sales have fallen. In paragraph 13 of the affidavit filed in support of the above writ petition, it is stated that the several acts of omissions and commissions were brought to the notice of higher authorities. No action has been taken. It is further submitted therein that in matters of this kind, it is not necessary even to make an application because there is a statutory duty cast on the authorities to ensure that there is no misappropriation of public funds. As no action has been taken by the authorities, the petitioner has filed the above writ petition.

(3.) In the interlocutory applications filed along with the writ petition, relief is sought for directing an enquiry by the Central Bureau of Investigation and in another interlocutory petition filed by the petitioner, the prayer is made for appointment of an interim administrator to take charge of the affairs of the third respondent company.