NITESH C. PATEL Vs. ONAEX NATURA (P.) LTD.

JUDGEMENT

(1.) COMPANY Application No. 222 of 2011 has been filed by the petitioners in Company Petition No. 51 of 2011 filed under section 397/398 of the Companies Act, 1956 ('the Act') complaining of various acts of oppression and mismanagement by R -2 and 3. The applicants have sought to implead ingenious Engineering (P.) Ltd. as R -4 in the company petition; to allow the applicant to amend para 3 and include paras '9(q)' to '9(jj)' in the company petition, and to amend the prayer clause of the petition in para 10 accordingly; pending hearing and disposal of the present application, passing of an order and/or direction restraining respondents and/or Engenious Engineering (P.) Ltd., from acting in pursuance/furtherance of purported resolution dated 30th September, 2010 increasing the authorised share capital to 5 crore purportedly passed in the annual general meeting ('AGM') of 30th September, 2010 and purported allotment of 5,25,000 shares. It is noted that CA 222/11 has been filed pursuant to the liberty granted by the CLB vide its order dated 19th October, 2011 whereby CA No. 174 seeking impleadment of R -4 and amendment of CP accordingly had been permitted to be withdrawn with liberty to file a fresh application. The applicant's case is that R -2 and 3, with mala fide intention to defeat the rights of the petitioners, issued and circulated a Notice dated 22nd June, 2011 of meeting of the Board of directors of the respondent No. 1 -company which was scheduled to be held on 7th July, 2011 to validate their unauthorised allotments by seeking to apprise the Board of alleged allotments of 5,25,000 shares to Engenious Engineering (P.) Ltd. and further also to approve the alleged allotment of shares to the shareholders for the alleged investment made by them during the period 30th October, 2010 -31st March, 2011. As there was already a status quo order by the CLB in respect of the shareholding, immediately on receipt of the said email dated 22nd June 2011, the applicants, petitioners vide their advocate's letter dated 25th June, 2011, addressed to respondent No. 3, Director of respondent No. 1 -company, replied and objected to the agenda for the scheduled meeting of the Board of directors. It was pointed out the purported allotment of 5,25,000 shares in favour of Engenious Engineering (P.) Ltd. in the purported meeting held on 29th October, 2011 was illegal and an attempt to create false record after service of advance notice of the filing of the company petition pointing out to the respondents' reply to the application wherein they have deliberately not referred to Notice of Board of directors dated 22nd June, 2011 nor of the alleged meeting which was earlier scheduled to be hold on 7th July, 2011. It was argued that the purpose of allotment of fresh shares to the exclusion of the petitioners has been done with a view to upset the existing shareholding and as per settled law, such an allotment is oppressive to the petitioners and hence deserves to be set aside and held null and void and not binding on the petitioners as well as on the respondent No. 1 -company. It was argued that since the events have unfolded now, the impleadment of Engenious Engineering P. Ltd. and accordingly amendment of the C.P. is sought to challenge the increase in the authorised share capital of respondent No. 1 -company from Rs. 1 crore to Rs. 5 crore, and to challenge allotment of 5,25,000 equity shares to EEPL and seek consequential reliefs.

(2.) TO support their contentions, the applicants relied upon the case law in Ashok Mittal v. Uniworth Resorts Ltd. : [2008] 86 CLA 185. (CLB) : : [2008] 4 Comp LJ 327; Sampath Kumar v. Ayyakanny : [2002] 7 SSC 559, Rajesh Kumar Aggarwal v. K.K. Modi : [2006] 4 SSC 385; Revajeetu Builders & Developers v. Narayanaswamy & Sons : [2009] 10 SCC 84 and Surender Kumar Sharma v. Makhan Singh : [2009] 10 SCC 626.

(3.) THE R -1 to 3 denied all the allegations made about surreptitious allotment of 5,25,000 shares to Engenious Engineering (P.) Ltd. as the same is taken as pretext to run away from the commitment to bring in agreed contribution by the petitioner in the respondent No. 1 -company. It was contended that it is evident from the gist of the discussion of meeting dated 29th October, 2010 vide communication dated 4th November, 2010. By virtue of serial numbers 5 and 8 of the said gist of discussion it was agreed by and between petitioners and respondents to increase the authorised capital and convert share application money into share capital of the respondent No. 1 -company solely for the purpose of meeting the requirement of disbursal of credit facilities. The petitioner has not only agreed but also signed the said gist of discussion wherein the contribution of Rs. 1.50 crore was to be brought in by the petitioner. The notice of 7th July, 2011 Board meeting expressly stated to apprise the Board about the action taken on the decision taken in the Board meeting held on 29th October, 2010. There are no groups of shareholders as alleged by the petitioners and all shareholders were given opportunity to contribute the capital of the company as per the decisions taken in the Board meeting and duly accepted by them. Further, it was pointed out that Form 23 as annexed by the petitioner themselves was approved by the Registrar of Companies on 31st October, 2010 which is much before the date of filing of petition and hence it was very much within the knowledge of the petitioners. Hence contentions seeing amendment in para (q) are not maintainable in the eves of law, petitioner No. 2 being a director was very much aware of the AGM held on 30th September, 2010 as evidenced by the signed copy of gist of discussions of Board meeting dated 29th October, 2010. Petitioner No. 1 has till date not informed to the company the address for sending notices in India as per the provisions of section 53 of the Act. Hence, contentions made in paras (r) and (s) are not maintainable in the eyes of law.