CHAND MALL PINCHA Vs. HATHIMAL PINCHA

JUDGEMENT

(1.) The appeal under Section 10(F) of the Companies Act is arising out and directed against an Order passed by the Company law Board (CLB in short), Principal Bench, New Delhi, inC.P.No. 17 of 1996 dated 11.6.1998. The above order in fact is an upshot of its earlier judgment and order dated 10th January, 1997 in a proceeding under Chapter VI of the Act before the CLB, questioning among others the decision to raise the authorised and paid up capital, the issue and allotment of 4000 equity shares of Rs.100/- each to the 6th respondent of the C.P. No. 17/96 as well as the appointment of respondent No. 4 as the Director. The CLB did not accept the plea of Oppression due to non appointment of N.K. Pincha (petitioner there) as Director, the appointment of Rajib Pincha (respondent No. 4) as the new Director. The CLB however on assessment of the fact situation, set aside the allotment of 4000 shares to the 6th respondent. To resolve the impasse, the CLB ordered both the groups their bid for the shares in the Company and whoever offers the highest bid, is to take control of the company. Both the parties preferred Appeals before this Court which were numbered and registered as O.J. (Company Appeal) No. 42 of 1997 and O.J. (Company Appeal) No. 44 of 1997, and] by a common judgment and order dated 18.3.1998, both the Appeals were dismissed consequently the parties offered their respective bids and acted as per the decision of the CLB. The respondents offered a price of Rs. 11,004 per share while the appellants offered the price of Rs. 7.771 per share. As per its judgment and order dated 10.1.1997 which was upheld in appeal, the CLB directed the respondents, the appellants here, to sell their shares at Rs. 11,004 per share to the petitioners, the respondents in this appeal. The total amount for 2,325 shares was worked out by the CLB at Rs. 2,55,84,300. Respondents were ordered to pay 35 lakhs on or before 2.7.1998 and balance in one or more instalments by 11.8.98. After the entire consideration is paid, these shares will be transferred in the nake of the petitioners (respondents herein for their nominees. A Board is reconstituted for the interregnum which also included the appellant No.1, Mr. Chand Mall Pincha. The CLB by its above order prohibited the private sale of tea incurring any expenditure other than normal course of business and restrained the Company from disposing the assets of the Company. Any payment exceeding Rs.20,000/- isito be made by Cheques jointly signed by the appellant No. 1, Mr. Chand Mall Pincha, and one of the Directors from the side of the respondents. The above order contains the following stipulations:

(2.) Mr. Anil Kumar Bhattacharyya, the learned senior counsel, assisted by Ms. Usha Baura, Mr. Apurba Sarma, Mr. Arup Kumar Sharma for the appellants assailed the above order mainly on the ground that the CLB erred in law in handing over the management of the Company to the respondents without any consideration against the shares held by the appellants. Mr. Bhattacharyya, the learned counsel, found fault with the order of the CLB for not ensuring the full payment payable by the respondents to the appellants prior to handing over of the management. Mr. Bhattacharyya, the learned senior counsel, in course of his lengthy argument, invited my attention to order of the Debt Recovery tribunal restraining the respondents from dealing with their personal assets. Mr. Bhattacharyya expressed his misgiving and mistrust about the ability of the respondents in raising funds to clear the stipulated sum as per the order of the CLB.

(3.) Mr. Jatindra Mohan Choudhury, the learned senior counsel, assisted by Mr. Pallab Kataki, Advocate, appearing on behalf of the respondents, seriously questioned the maintainability of the Appeal both on facts as well as in law. Mr. Choudhury, the learned senior counsel submitted that the present order in fact is passed as a sequal to the earlier judgment and order of the CLB dated 10.1.97, which was subsequently upheld by the Company Judge in appeal and thus attained its finality.