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2022 (5) TMI 537 - Tri - Companies LawMaintainability of petition - legality of removal of the Petitioners from the Directorship - applicability of Section 241-242 of the Companies Act - Whether the Petitioners are eligible to maintain this Petition under Section 241-242? - HELD THAT:- It is seen from the records that the 1st Petitioner was holding 44.33% fully paid-up share in the 1st Respondent Company and he has filed the affidavit on behalf of the 2nd Petitioner who was having 5.75% of fully paid-up shares in the 1st Respondent Company. Hence, the affidavit submitted by the 1st Petitioner holding 44.33% for filing a petition is sufficient and the same can be accepted in order to accept a petition under Sections 241-242 of the Companies Act, 2013. Given the facts, the Petitioners are eligible to file a Company Petition under Section 241-242 of the Companies Act, 2013. Whether the removal of the Petitioners from the Directorship is illegal? - Section 169 of the Companies Act, 2013 - HELD THAT:- A reading of provision of Section 169 makes it clear that to remove a director from the Company, the Company has to comply with the procedure prescribed under Section 169 of the Companies Act, 2013. As per Section 169(2), a special notice is required to remove a Director or to appoint somebody in place of a Director so removed, at a meeting at which he is removed. The Company shall forthwith send a copy thereof to the Director concerned, and the Director shall be entitled to be heard on the resolution at the meeting - the act of the shareholders in the matter of appointing or removing the directors of the company from the Board cannot be a subject matter of judicial scrutiny, since the right to appoint or remove directors is supreme as a part of the corporate democracy. Whether the removal of the Petitioners from the Directorship is oppressive or prejudicial to attract Section 241-242 of the Companies Act? - HELD THAT:- It is seen from the records that the removal of the Petitioner from the Directorship of the Respondent Company was done following all the mandatory requirements in accordance with law. There are no oppression and mismanagement in the Company, while doing so. Moreover, the contention of the petitioners regarding the share transfer cannot be accepted as they have affixed their signatures on the Share Transfer Deed (SH4) on 29.01.2021 at Trichur before the Statutory Auditor of the 1st Respondent Company which was not refuted by the Petitioners - even though the 2nd Petitioner is eligible to maintain the Company Petition on the basis of the affidavit sworn to by the 1st Petitioner, there are no reason to allow the Company Petition and grant any relief to the Petitioners as sought for. Petition dismissed.
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