DESCON LIMITED Vs. BIMAN BEHARI SEN

JUDGEMENT

(1.) THE Judgment of the Court was delivered by Background: This is an appeal from the order of the Company Law Board made on 30th March, 2010. It held in that order that the supporters of the applicants before them were more than the required number, necessary, under section 399 of the Companies Act, 1956 ("the Act") to support their application under sections 397 and 398 of the Act. THE appellant submits that such support was not there and the Board ought to have dismissed the main proceedings and allowed their application in this behalf.

(2.) ANY shareholder cannot maintain a proceeding under section 397 and 398 of the Act. Section 399 inter alia enacts that 100 or l/10th of the total number of members of a company whichever is less have the right to apply under sections 397 and 398. ANY member or members holding not less than l/10th of the issued share capital can also apply. Section 399(3) permits any member with the support of others, adding to make the required number of shareholders, to make the application.

(3.) THE case of the appellant was put in this way. THEy argued that 93 such letters of consent appended to the petition were undated. According to the affidavit-in-opposition filed by the contesting respondents being the applicants before the Board, these consent letters were signed some time in November 2008. Further, according to the admission of the said respondents at page-292 of the paper book the 397 proceedings petition was made ready on 5th December. 2008 and filed in January, 2009. THErefore, according to them all these consent letters were signed before the 397 petition was made ready. Hence, there was no consent to this petition. Further according to the appellant specimen signatures of 9 persons do not tally with the signature recorded with the company. One does not hold any share in the company.