GYAN DEV SADH Vs. PARMESHWAR EXPORTS (P.) LTD.

JUDGEMENT

(1.) THE present petition is filed by invoking various provisions of the Companies Act, 1956 ('the Act') alleging certain acts of oppression and mismanagement in the affairs of the company and sought declaration that:

(2.) IT is further submitted that the petitioners decided to inspect the records of the R1 with the RoC and inspected the records of the R1 on 10th April, 2008 and shocked to know that further 49,960 equity shares have been allotted by R1 -company and the paid -up share capital has been increased to 50,000 equity shares. The petitioners have also come to know that R2 to 6 are using the property of R1 situated at Andheri (East), Mumbai for their own personal use and not for the purpose of the business of R1; and it is found that there is no revenue generating for R1 which is clear and unambiguous case of diversion and siphoning off the funds of R1 -company. The petitioners have also come to know that the R2 to 6 have given the property of R1 -company situated at Andheri (East), Mumbai on lease to. R7 without the knowledge and consent of the petitioners. The petitioners requested the R2 to 6 as well as the R7 to produce the copy of the lease agreement entered into between the R1 and R7. The petitioner No. 1 has come to know from the correspondence exchanged with the R7 that the said purported lease agreement was approved in the alleged Board meeting held on 15th December, 2005 while the fact is that the petitioner No. 1 never received any notice of the said alleged Board meeting of the R1 -company. The respondents are using the R1 -company as a vehicle for their personal enrichment. The petitioners have now also learnt that as a part of their design to deny and deprive the legitimate rights and expectations as shareholders, as also of the fruits of their labour and vision, the R2 to 6 have been siphoning away valuable assets and rights of the R1 -company. The sole motive of R2 to 6 is to exclusively take over the R1 and its management to the exclusion of the petitioners, with the ultimate aim and objective of converting the company into their personal business for their personal benefits and enhancement. It is further submitted that R2 to 6 are not interested in the welfare and well being of the R1 but is actively engaged in illegalities and misconduct and misappropriating assets to their personal accounts under his control which is prejudicial to the R1 and the petitioners as the 50 per cent shareholder of R1. Such actions are bound to result into winding up of the R1. The learned counsel further submitted that the respondents admitted the fact that the petitioners and the respondents are equal shareholders. After September 2003 the petitioners were excluded from the management and the respondents are only in the management. The R2 appointed R3 as director. He contended that there must be clear denial in respect of pleadings if there is no admission either denial or admission it amounts to admission of fact and in support thereof he relied upon the following citations : (i) Badat & Co. v. East India Trading Co. : AIR 1964 SC 538 at paras 11 and 13 and (ii) Sushil Kumar v. Rakesh Kumar AIR, 2004 SC 230.

(3.) TO resolve the disputes and differences between the petitioners and the respondents, the above family arrangement came to be arrived at. It is an admitted fact that the Bazzardev Sadh group and the Gyandev Sadh group held certain, inter alia, immovable properties, either in the individual names of the members of the family or in the name of partnership firms or limited companies. Certain disputes and differences arose between the parties, inter alia, in respect of such immovable properties. The parties referred such disputes and differences to the mediation of their family advocate and solicitors and their family chartered accountants for division and/or segregation and/or separate allotment of such properties, among the said 2 brothers and their respective family members. Pursuant to such mediation, family arrangement/settlement was arrived at between the Bazzardev Sadh group and the Gyandev Sadh group, whereby six immovable properties were divided and/or segregated and consequently allotted to the Bazzardev Sadh group and the Gyandev Sadh group. The heads or main features of such family arrangement/settlement have been recorded in writing by memorandum duly signed by the parties and such family arrangement/settlement has been substantially implemented. Pursuant to such family arrangement/settlement and in implementation thereof, inter alia, the possession of the properties coming to the share of each group has been handed over to each group and each of the said groups are in exclusive use, occupation, possession and enjoyment of the properties coming to their respective share. The concerned group is also in complete control and management of such company/companies and is enjoying the income, profits and assets of such company. Virtually the only part of the implementation that remains pending of such family arrangement/settlement, being that the parties are required to execute certain formal documents to formally convey title in respect of such properties coming to the share of respective groups and/or to execute documents, inter alia, necessary for formal retirement by the concerned members of each group, as partners of the concerned partnership firm and/or formally transfer the shareholding held by the concerned members of each group. Most of the documents required to be signed by the Bazzardev Sadh group in respect of the properties coming to the share of the Bazzardev Sadh group, have in fact been executed by them. The Gyandev Sadh group, however, with mala fide intention and ulterior motive, have failed and/or neglected and/or avoided to execute such documents and consequently to complete the implementation of the family arrangement/settlement arrived at between the parties and is now appear to be interested in resiling and/or wriggle out of the family arrangement/settlement already arrived at and not implementing the remaining part of the same. The Bazzardev Sadh group, therefore, was constrained to file the said suit before the hon'ble High Court. Needless to state that the respondents, i.e., the Bazzardev Sadh group have always been ready and willing to fulfill their part of the obligations under the family arrangement/settlement and to implement the same as agreed including by executing appropriate documents for formally conveying the title in respect of the properties coming to the share of the petitioners, i.e., the Gyandev Sadh group.