Home Case Index All Cases Companies Law Companies Law + AT Companies Law - 2019 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (6) TMI 137 - AT - Companies LawOppression and mismanagement - waiver of requirement specified in Section 244 of the Companies Act, 2013 - Scope of 'Member' - shareholding of Respondent No. 1 being zero percent - HELD THAT:- Admittedly, Respondent No. 1 was a shareholder of the Company since its incorporation. It is not the Appellant’s case that Respondent No.1 was holding shares below the threshold limit. Appellants have not also been able to demonstrate that the number of members of the Company exceeded 10. Admittedly, the parties belong to one family. Respondent No.1 and Appellant No.1 are brothers while Appellant No. 3 and 4 are their parents. It is not disputed by the Appellants that both brothers i.e. Respondent No.1 and Appellant No.1 held 25% shareholding each in the Company while their father Appellant No. 3 held 50% shareholding. Whether the shareholding of parents stated to have been increased between year 2009 to 2011, the substantial hike resulting in reduction of shareholding of Respondent No. 1 to 0.33% was an act of manipulation on the part of Appellant No.1 or had been done with the consent and approval of Respondent No.1 who too was the Director of the Company, is the core issue in the Company Petition, which, alongwith other contentions raised may or may not establish oppression as alleged by Respondent No.1 - In the absence of relevant record, being withheld and explanation for such withholding not being found plausible and convincing, Respondent No.1 cannot be held as having been divested of the status of a ‘member’ of the Company for limited purpose of waivement of the requirement as specified in Section 244(1)(a) of the Act. When the status of Respondent No.1 being a shareholder with 25% shareholding at the time of incorporation of the Company and also being one of the founding Directors of the Company is admitted, it cannot be contended that he ceased to be a “member” upon reduction of his share capital and that too when the transfer of shareholding is alleged to be clandestine and product of fabrication and forgery. Appeal dismissed.
|