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2023 (10) TMI 1221 - HC - Companies LawRe transfer of shares on account of non fulfillment of MoU by Arcadia - whether the Arcadia can be restrained from taking any decision which will hamper the interest of Hexogon while protecting their right to two mortgaged flats? Grievance is when the full amount is not advanced, the transfer of shares of defendant nos. 5 and 6 are ineffective. HELD THAT:- The law is well settled in case of Life Insurance Corporation of India [1985 (12) TMI 289 - SUPREME COURT] and it is reiterated by the Division bench of this Court in case of Invesco Developing Markets Fund and Ors. [2022 (3) TMI 1175 - BOMBAY HIGH COURT]. Court cannot restrain holding of any Extra Ordinary General meeting. There are only certain exceptions, where Court can interfere and it can be only when procedural and numerical requirements are not fulfilled. The Division bench of this Court has also cautioned what will be situation if the Court will start interfering in holding of the meeting of the Company. Ultimately, it is part of the Corporate democracy. No ground is made out for stalling of EOGM. The Court cannot stall holding of any meeting of the company. This is the prerogative of the shareholders. About offering corporate guarantee by Hexagon - when the proceeding will be go on with DRT, there will be conflict of the interest in between the Defendant No. 4 being managed only by Arcadia on one hand and Arcadia as borrower of the Kotak Mahindra Bank Limited on the other hand - HELD THAT:- No doubt, it is true that Plaintiff or Hexagon does not say that they have paid dues of the Arcadia. It is an independent issue. It is also true that the Arcadia being lender has got right as per the Memorandum of Understanding to sell those flats by giving a notice. No doubt notices are also given. That right is an independent right. However, when the question of the proceeding before the DRT arises, certainly the interest of the Hexagon needs to be protected to certain extent. The issue raised about notice by India bulls to the Hexagon cannot be considered in this application. So also the argument of by plaintiff’s counsel about newspaper articles about the antecedents of directors of Arcadia is not impressing. This Court is aware that the issue of those flats is not subject matter of the inquiry before this Court. However, when it is question of taking decision by Arcadia being in management of the Hexagon, on limited extent, this Court can certainly interfere. It may also happen that the Arcadia being in control of the Hexagon may pass a resolution about their possible stand before DRT or may even submit to the Orders of DRT - the interest of the Plaintiff and shareholder of the Hexagon needs to be protected. As a shareholder of defendant No. 4, Defendant No. 1 is restrained from taking any decision which may amount to giving consent/NOC for handing over possession of two flats before DRT in proceedings involving Kotak Mahindra Bank Limited. - application disposed off.
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