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2022 (7) TMI 204 - AT - Companies LawOppression and Mismanagement - Issue of Right Shares - subsequent Rights Issue during the pendency of 1st Rights Issue - gross under-subscription of the rights issue - `non-participation’ in the `Legitimate 1st Rights Issue’ - additional loans/funds being sanctioned by the SBI and PNB Bank being suppressed from this Hon’ble Appellate Tribunal, Hon’ble NCLT and shareholders - mismatch in the dates of valuation report of 2nd rights issue and purported email - details regarding status of disbursement of loan, debt equity ratio, defaults, shortfalls, etc. not given to the Hon’ble NCLAT, Hon’ble NCLT and shareholders - withholding of vital documents/annexures by the Appellant - section 241 and 242 of Companies Act - Increase of Share Capital - HELD THAT:- Section 62 of the Companies Act, 2013, relates to an increase of Share Capital, of course, within the Authorised Capital. In reality, it is aimed to include a matter, where the Directors determined to increase the Capital by issuing further Shares within the Authorised Limit, as per the decision of the Hon’ble Supreme Court in Nanalal Zaver And Another vs Bombay Life Assurance Co. Ltd. and others [1950 (5) TMI 15 - SUPREME COURT]. Aim of Section 62 - HELD THAT:- The purpose of Section 62 of the Companies Act, 2013, is to increase the Capital for the needs of the Company, the proportionate allotment is coincidental to increase of Subscribed Capital. The Articles of Association of a Company generally / ordinarily specify in the Regulation about the aspect of Rights Issue. As a matter of fact, Section 62 of the Companies Act, 2013, embodies in Statutory Form the rudimentary notions as among the Shareholders inter se and governing them, with power to allot Shares - It is for the Directors to determine how may Shares and of what Value, they will issue the Shares. The enhancement of Capital is purely a matter of an internal Administration of the Company and the Courts do not interfere in such matter in normal course. In terms of the ingredients of Section 62 of the Companies Act, 2013, the Directors have to offer further Shares issued, to the Shareholders who are on the Register of Companies and not to anyone else, and in fact, the Offer must be in the same proportion to all the Shareholders. It is to be remembered that there shall be no discrimination among them. Rights Issue Principle - HELD THAT:- If the increase of Capital was found to be necessary for genuine business purpose, the company as per Section 62 of the Companies Act, 2013, could raise further Capital from public. Member, Shareholder and Holder of Shares - HELD THAT:- The word `Member’, `Shareholder’ and `Holder of Shares’ are employed in the Companies, Act, 2013, in same sense, meaning; persons holding `Shares’ in a company and registered as such in the `Register of Members’ of the company - An Issue of Shares on Rights basis cannot ordinarily be subject of a complaint, as an act of Oppression. In the decision of Hon’ble Supreme Court in Worldwide Agencies (P) Ltd. V Margarat T. Debor (Mrs.), [1989 (12) TMI 245 - SUPREME COURT], it is observed and held that in some situation and contingencies the Member may be Holder of Shares, but a Holder may not be a Member. Principles of Natural Justice - HELD THAT:- Undoubtedly, the Principles of Natural Justice are not the edicts of a Statute. An absence of ascribing reasons will give a person, a sense of feeling of injustice whether it is before an Administrative / Judicial / Quasi-Judicial Forum which passes it, in the considered opinion of this Appellate Tribunal. This Tribunal keeping in mind of the fact that the Company Petition No. 98/CTB/2019 was filed in terms of Section 241 & 242, read with other provisions of the Companies Act, 2013, among other things averring oppressive and mismanagement acts, purportedly committed by the Respondents therein, and considering the observation made by the National Company Law Tribunal, Cuttack Bench, in the impugned order in C.A. No. 45/CB/2021 dated 23.03.2022 that when the ₹ 1st Rights Issue was pending, the subsequent Rights Issue during the pendency of the Application comes very much within the ambit of this Application and when the Tribunal by the impugned order in C.A. No. 45/CB/2021 in C.P. No. 98/CTB/2019 had restrained the Respondents therein, from going ahead with the present Rights Issue in progress or any further Rights Issue till the disposal of the Application and C.P. No. 98/CTB/2019, etc., being an interim order, this Tribunal, without expressing any opinion one way or the other on the merits of the matter in pending C.P. No. 98/CTB/2019, on the file of the Tribunal and also not delving deep into the same, exercising its prudent sound discretion in a subjective manner is not inclined to interfere with the impugned order dated 23.03.2022 in C.A. No. 45/CB/2021 in C.P. No. 98/CTB/2019. Appeal dismissed.
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