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2019 (7) TMI 523 - AT - Companies LawOppression and mismanagement - Termination of services of 1st appellant as an “employee” - HELD THAT:- Due to internal disputes within the Management, the bank account being suspended for operation, the company was in financial crises. In these circumstances the need for raising funds through issue of equity shares cannot be held to be unreasonable. There is also force in the argument of the Learned counsel for the Respondent that these shares have been issued to the appellant himself and his supporters. It cannot said that it is fair allotment of shares. We observe that even if the company was in need of funds, the new equity shares should have been issued in a fair manner to the existing shareholders on pro-rata basis as per their holding in the company. This company being company of employees is being run by the employees. While the present parties before us are rival groups who continue to claim right to Management and continue to assert rights against each other and have created various confusions relating to the incidents and facts. The confusion gets reflected even in the impugned order. It appears to us that this company which appear to be running well needs to be protected from internal group rivalries. The appointment of 1st Respondent, Shri Deba Kumar Hazarika, as Director is held illegal - decision taken at the EOGM dated 14.11.2009 removing original R-5 as Director and Managing Director of the Company is set aside - Impugned order is set aside - appeal allowed.
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