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2019 (6) TMI 331 - NATIONAL COMPALY LAW APPELLATE TRIBUNAL, NEW DELHIOppression and mismanagement - order under Section 242 of the Companies Act, 2013 - position of Mr. K.K. Jagadish as Managing Director of the Company on 15.5.2015 - HELD THAT:- We have also seen the copy of Special Notice dated 15.5.2015 (Page 198) by which it is proposed that a Meeting will be held on 7th August, 2015 to removed 1st respondent as Managing Director. We have also seen the minutes of the meeting of the Board of Directors held on 15.5.2015 (Page 201 to 203) in which it was resolved that 1st respondent be and is hereby removed from the Directorship and Office of Managing Director of the company with effect from the date of approval of this resolution by the shareholders. We have already observed that in the notice there was an agenda for removal of 1st respondent as Managing Director and not director. Therefore, the NCLT in exercise of its powers under Section 242 of the Act has rightly set aside the decision of the company to remove 1st respondent as director of the company. Financial Collaboration Agreement (FCA) - HELD THAT:- As per FCA, only 10% shares were fixed for 1st respondent and accordingly he has been allotted the requisites shares. There is no evidence brought on record that 1st respondent is to get additional 15% shares from 2nd respondent either through FCA or any other documents. Therefore, we are in agreement with the conclusion drawn by the NCLT on this count. The arguments advanced by the appellant that 1st respondent was removed due to loss of confidence. We observe that loss of confidence as argued by the appellant does not appear in the Companies Act. We observe that the NCLT has rightly given his findings and arrived at to give compensation of ₹ 105 lakhs (calculated at the rate of ₹ 35 lakhs p.a. for three years) together with interest @ 10% from the date of removal of the 1st Respondent as Managing Director plus other benefits as already offered, till the date of payment by the company/other respondents. Appeal dismissed.
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