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Companies Law - Case Laws
Showing 1 to 20 of 519 Records
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2018 (12) TMI 1884
Order of refund some of its FDR (Fixed Deposit Receipts) of 17 investors within 30 days - non-compliance with the order - HELD THAT:- From the conspectus of the facts, it appears that the petitioner has no role in the allegations leveled against him. The post on which the petitioner was appointed as Director of the Company seems to be a mere paper arrangement only and unquestionably his tenure is of approximately four months i.e. from 07.11.2013 to 06.03.2014.
Assuming that the petitioner has in fact taken some decisions as per the say of the respondents, there is nothing to show that he had attended any Board Meetings as a Director or otherwise or he has formed any committee or has taken any decision during his tenure of three months by exercising powers of Director. No material is produced on record to show that the petitioner in fact had participated in any of the Board Meetings or had appointed any Committee as envisaged in Section 292 of the Act. As per section 283(1)(g) of the Act, the petitioner would seize to function as a Director, as he did not attend the Board Meetings for a period of three months. In the affidavit filed by the respondents in the aforenoted writ petition, it is admitted that the tenure of the petitioner was from 07.11.2013 to 06.03.2014. Thus, in absence of any material against the petitioner depicting his involvement in the affairs of the Company, it can be safely presumed that there was no role played by the petitioner in any capacity in taking any decisions which would attract the offences alleged against him in the impugned criminal cases.
This Court is of the considered opinion that the criminal cases filed by the Registrar of the Companies are liable to be quashed and set aside by invoking the inherent and extraordinary powers of this Court under Section 482 of the Code of Criminal Procedure in order to prevent the abuse of process of Court - Petition allowed.
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2018 (12) TMI 1857
Serious allegations of diversion and rotation of funds of a large amount and directed the Serious Fraud Investigation Office (SFIO) to investigate the prima-facie allegations which have been referred to in the gist of the report - main contention of the learned counsel for the appellants is that the impugned order directing an investigation by the SFIO could not have been passed in the exercise of contempt jurisdiction by the learned Single Judge - HELD THAT:- The facts of the present case demonstrate that the learned Single Judge judiciously exercised the power and passed the impugned order. There is prima facie stated to be sufficient material on record for passing the direction to investigate prima facie allegations which have been referred to in the gist of the report. This Court would wish to clarify here that the learned Single Judge in the impugned order has only stated that prima facie serious allegations of diversion and rotation of funds of a large amount has been disclosed and directed the SFIO to investigate the prima facie allegations, which does not mean that the Court in any manner has given its verdict on the same and/or expressed any final opinion about the same. The learned Single Judge so far as the investigation is concerned, has also directed that the investigation shall be conducted as per law and following the due process of law under the Act and the Rules thereunder and the SFIO shall certainly submit the report and shall suggest the future course of action after giving an opportunity of hearing to both the parties.
As per Section 211, the Central Government has the power to direct the investigation by the SFIO. This is further clear from Section 212(1) which states that the investigation by the SFIO is conducted at the instance of the Central Government. The investigation is conducted where the Central Government is of the opinion that it is necessary to conduct an investigation into the affairs of the company and it also specifically enlists the cases under which such investigation can be ordered - Upon completion of the investigation by the officers of SFIO, the report also has to be submitted to the Central Government.
The Court has the power while dealing with the matter under the Contempt of Courts Act, to order for an investigation of the matter which comes in the knowledge of the Court regarding any violation, breach of law etc. and such a power stands derived from the Constitution itself, hence the submission of the learned counsel for the appellants that the Court cannot pass any direction for investigation while dealing with the contempt petition is absolutely untenable in law, hence the same is rejected. The impugned order passed by the learned Single Judge, in view of the facts and circumstances of the case, has been passed fully within the precincts of the power of the Court and the direction for investigation by the SFIO into the prima facie allegations which have been referred to in the gist of the report is just and proper - However, in view of the intent of Section 211 and Section 212(1) of the Companies Act, 2013, the order requires little modification and is modified to the extent that the impugned order of the Court shall be communicated to the Central Government which shall examine the same and may direct the investigation in terms of Section 211 of the Act. The Central Government shall communicate the decision taken in this regard, as expeditiously as possible, to the Court.
Application disposed off.
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2018 (12) TMI 1854
Belated submission of Resolution Plan - Illegality of the decision of the CoC, refusing to open the envelop of the Resolution Plan sent by the Applicant and to return the same to the Applicant without considering the resolution plan on its merits - Direction to CoC to consider the resolution plan submitted by the Applicant on its merits as Applicant believes that its plan will maximize the asset value of the Corporate Debtor - whether the Resolution Plan of the Applicant can be considered at this belated hour or should the same be rejected even without looking into the same? - HELD THAT:- When there is a clash/ conflict between the Regulations and the Code, the object of the Code is paramount and not the Regulations which are formed only for the just implementation of the Code. Purely on the basis of technicalities, the rejection of Resolution Plan even without looking into its merits, is certainly an act which shall go against the very spirit of the Code and may even result in a huge loss to the Company. Any Regulation which does not anticipate such a situation and if the same comes in the way of proper justification and implementation of the principles of the Code, the same need not be considered nor can be treated as an impediment in the implementation of the Code.
The spirit of the Code is first and then comes the other things. The rejection of the Resolution Plan by the CoC even without opening the envelope containing the Resolution Plan on the ground that the same is submitted after the expiry of the stipulated time fixed by the CoC, is certainly against the law/Code and we hereby direct the Respondent to forthwith consider the Resolution plan of the Applicant on its merits and judicious decision may be taken in the best interest of the parties concerned - the Application is allowed.
Seeking exclusion of period of 15 days from the Corporate Insolvency Resolution Process - section 60(5) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The Hon’ble NCLAT in its order dated 08.05.2018 in the case of QUINN LOGISTICS INDIA PVT. LTD. VERSUS MACK SOFT TECH PVT. LTD., MOHD. SABIR PARVEZ AND MR. M.L. JAIN, (RESOLUTION PROFESSIONAL) [2018 (6) TMI 904 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] where it ws held that it is clear that if an application is filed by the ‘Resolution Professional’ or the ‘Committee of Creditors’ or ‘any aggrieved person’ for justified reasons, it is always open to the Adjudicating Authority/Appellate Tribunal to ‘exclude certain period’ for the purpose of counting the total period of 270 days, if the facts and circumstances justify exclusion, in unforeseen circumstances.
This Bench, considering the warranting situation in this case, hereby excludes the period of 5 days i.e. the period of pendency of Application No. 1529 of 2018 before this bench from 17.12.2018 to 21.12.2018, considering the facts, the Resolution Professional has to carry out the certain duties and obligations with regard to the resolution plan before submission of same to the COC. In the normal course, the CIRP period will come to an end on 29.12.2018. But in view of the above extraneous circumstances warranting the interference of this Bench which is of the considered view that the period of 5 days during which the Application No. 1529/2018 was pending, is required to be excluded and consequently the CIRP period of 270 days will end on 03.01.2019.
Application disposed off.
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2018 (12) TMI 1832
Mr.Lohia for plaintiffs and Mr.Parekh for defendant no.1 state that the persons who have signed on behalf of plaintiffs and defendant no.1 are present in Court and identify them.
Stand over to 21.12.2018.
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2018 (12) TMI 1816
Oppression and Mismanagement - Maintainability of petition - appellate remedy available to the petitioners - section 61 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- This Bench has considered a similar question arising under the Companies Act, 1956, proceedings arising out of an application under Section 241 and 244 of the Companies Act dealing with oppression and mis-management in CRP.No.3739 of 2016 [2019 (9) TMI 535 - MADRAS HIGH COURT]. In that case against an interim order passed by the National Company Law Tribunal, Revision Petition under Article 227 of the Constitution of India was filed in this Court. In that case, like in the present case a preliminary objection was taken regarding the maintainability of the Revision Petition because of the Appellate remedy provided under Section 421 of the Companies Act.
Petition dismissed as not maintainable.
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2018 (12) TMI 1798
Winding up of respondent company - Sections 433 and 434 of the Companies Act, 1956 - time limitation - It is the case of the petitioner that in course of business transaction, the petitioner company delivered goods as indicated from the invoice cum delivery challan at Annexure B (collectively) to this petition - HELD THAT:- There is no record even remotely suggesting that any complaint as regards quality of the goods was ever raised by the respondent company. The learned counsel for the respondent candidly submitted that the Bank has also taken action under the SARAFAESI Act which is subject matter of appeal before the Debt Recovery Tribunal wherein stay is granted and it was further submitted on behalf of the respondent company that if those proceedings are over, some payment can be made. It was also candidly submitted by the learned counsel for the respondent that on an inquiry made by the Court, temporarily respondent company is not in operation. Even the additional affidavit filed by the petitioner before this Court clearly mentioned that respondent company incurred loss in the year 2012, 2013 and 2014. Considering the date of invoice and the date of filing of this petition and even on the ground of limitation, prima facie present petition is within the time.
Petition admitted.
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2018 (12) TMI 1767
Allotment and transfer of share - It is stated that the petitioner had already submitted the transfer instrument duly executed by the petitioner as directed by the respondent No.1 company but the respondent No.1 company first denied the transfer on the ground of non-inheritance of the said right and later on, on the ground that the relevant documents were not provided before 26.09.2007 - condonation of delay in filing appeal - HELD THAT:- The instant prayer made under Section 58 of the Companies Act, 2013 is in the nature of Appeal as contemplated in sub-section (4) of Section 58 and the application for condonation of delay is maintainable in the Appeal.
The petitioner had been pursuing the genuine cause of seeking the letter of Administration before the District Judge in the application filed in the year 2007 which was decided after a period of 5 years, in the year 2012. The delay thus cannot be said to be malicious or contumacious but rather bonafide. The application for condonation of delay is thus allowed.
The arrangement as well as the later correspondence of respondent No. 1 company clearly brings out that transfer of share is involved and thereby Section 58(4) of the Act would become applicable. In view of this position, the applicability of Section 59 of the Act is not being examined.
The respondent No.1 company without sufficient cause refused to register the transfer of shares consequent to the arrangement between the respondent no.1 company and the erstwhile respondent No.2 company whereby the father of the petitioner/his legal heirs were entitled to receive equivalent shares of respondent company No.1 from respondent company No.2 - the petition is maintainable in law and the contentions raised by the respondent No.1 and 2 companies in respect of the maintainability of the petition cannot be accepted.
Under the provisions of Section 58 (5) of the Act, we direct that the transfer shall be registered by the respondent No. 1 company and the respondent No.1 company shall comply with such order within a period of ten days on receipt of the order - Application disposed off.
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2018 (12) TMI 1748
Sanction of amalgamation scheme - Section 230 to 232 of the Companies Act, 2013 - entire undertakings, assets, business and liabilities of the Transferor Companies No. 1,2, and 3 are proposed to be amalgamated with and vested in the Petitioner/Transferee Company as a going concern - shifting of the Registered office of the Petitioner/Transferee Company from the State of Karnataka to the State of Tamil Nadu, and a change in the name of the Transferee Company from Shriram Chits (Karnataka) Private Limited to Shriram Chits (India) Private Limited.
HELD THAT:- The object and business of the Company involved in the Scheme relates to Chit Funds or Kuries and all similar kinds of schemes which encourage the habit of savings by affording all facilities for the purpose and more especially by opening Chit Savings, Thrift savings, and other deposit schemes in relation to trade or public, commercial and regular needs. Therefore, the ordinary public is involved in the business of the Company and the interest of those ordinary public has to be taken care of while sanctioning the scheme.
It is not in dispute that the Tribunal is empowered to sanction the Scheme. However, cases like the present one where the business lies with ordinary public, it is necessary for the Company to take permission/approval from the appropriate authorities - In the instant case, Registrar of Chits is the concerned authority to examine the issue in light of the terms and conditions proposed in the Scheme.
In the interest of justice, the Scheme subject to condition that approval can be taken from the Registrar of Chits after the sanction of the Scheme, cannot be sanctioned - Therefore, the instant Petition is disposed off by granting liberty to the Petitioner to comply all observations/objections as raised by the Regional Director and the Registrar of Companies, especially the observation/objection with respect to approval of the Registrar of Chits in the interest of public/chit holders and thereafter file afresh.
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2018 (12) TMI 1746
Consolidation and division of the equity shares of the Company - Section 61(1)(b) of the Companies Act, 2013 read with Rule 71 of the National Company Law Tribunal Rules, 2016 - Exit offer to the public shareholders - HELD THAT:- On perusal of the report of the Registrar of Companies, Karnataka, Bangalore, it is clear that the Company should rather opt for the procedure prescribed under Section 68, Companies Act, 2013 if it wishes to reduce the public shareholders and save costs.
Furthermore, on perusal of the Circular No. SEB1/HO/MRD/DSA/CIR/P/2016/110 dated October 10, 2016, at the Annexure-A, para (vi), the Promoters are liable to acquire shares that are not offered under the exit offer up to a period of one year from the completion of offer. However, it appears the Promoters of the Company have not utilised this provision to acquire all the shares of the public shareholders after completion of one year. Instead, they have appeared before this Tribunal for purchasing shares and providing an exit route to the public shareholders, but under the pretext of consolidation of the share capital - This evinces an intention to avoid compliance with necessary provisions of Companies Act, 2013 and SEBI regulations.
Petition dismissed.
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2018 (12) TMI 1744
Rejection of prayer to transfer the creditor’s winding-up proceedings to the adjudicating authority - admissibility of creditor’s petition by disregarding the defence sought to be set up by the company - whether the mere filing of a petition by a financial creditor under Section 7 of the IBC in respect of a company should prompt the company Court in seisin of a creditor’s petition against the same company to transfer such pending proceedings to the adjudicating authority under the IBC?
HELD THAT:- There are several situations which can arise. Either party – meaning the creditor or the company – may apply in such a situation or, in the post-admission stage, any other creditor may apply and assert that since the matter has partaken a representative character, any other creditor of the company would be deemed to be a party within the meaning of that word first used in the second proviso to Section 434(1)(c) of the Act of 2013. It could also be that at a pre-admission stage both the company and the creditor jointly apply or one of them applies and the other consents. Even in such a scenario, the Court has to apply its mind to see whether any other is sought to be prejudiced by such consent.
It is possible that the very admission of a financial creditor’s petition by the adjudicating authority under the IBC simultaneously triggers off of a moratorium of all other proceedings pertaining to the same company including the pending proceedings before the company Court. But the company Court should be sure that the proceedings before the tribunal or adjudicating authority are firmly in place before transferring the proceedings pending before it when the transfer is resisted by the creditor who has brought the petition before the company Court. It is possible that by virtue of the related provisions of the IBC, an order of admission would imply the immediate appointment of interim resolution professionals and the consequential suspension of authority of other adjudicating fora in respect of matters pertaining to the concerned company; but so be it.
Once the proceedings under the IBC have been admitted, the company Court should yield to the more modern mechanism under the IBC in view of the obvious legislative intent apparent. It was because the liquidation proceedings envisaged by the 1956 Act were found to be less than ideal, that an entirely different scheme has been put in place by the IBC in 2016. Thus, once proceedings pertaining to a company have been admitted by the IBC and the merits of such proceedings are to be gone into for the purpose of the preparation of a resolution plan, the proceedings pending before the company Court should ordinarily be transferred to the tribunal or adjudicating authority. It is true that such transfer, according to the appellant herein, makes no difference since the company Court would already have lost its jurisdiction, by virtue of the moratorium envisaged in the IBC, to adjudicate on the creditor’s claim; but the company Court would be well within its rights to decline a transfer till the proceedings before the adjudicating authority under the IBC stand admitted.
There is no ground to disagree with the order impugned dated August 9, 2018 by which the company’s petition for transfer of the respondent’s winding-up proceedings to the National Company Law Tribunal has been declined by the company Court here - neither appeal holds and the orders impugned dated August 9, 2018 and August 10, 2018 are affirmed - Appeal dismissed.
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2018 (12) TMI 1717
Maintainability of petition - breach in terms of AMC contract - It is the case of the respondent that the instant petitions are not maintainable as the respondent is not liable to discharge any debt and the sum claimed by way of compensation is not a debt as defined under law but, the same are damages and hence, the Company petitions are not maintainable - availability of alternative remedy of appeal - HELD THAT:- In the instant case as stated supra, it is not just a case of mere denial but there is also a counter claim. Hence, the contention that the sum offered by way of a goodwill gesture, has to be construed as an admitted debt is baseless and requires to be rejected. More so, in the light of the fact that the respondent has categorically stated in the correspondence that the offer stands withdrawn.
The respondent has categorically asserted in the legal notice that as the petitioner failed to accept the proposal in full and final settlement, the proposal has been withdrawn.
A claim for damages for breach of contract is, therefore, not a claim for a sum presently due and payable and the purchaser is not entitled, in exercise of the right conferred upon it under Clause 18, to recover the amount of such claim by appropriating other sums due to the contractor - it is not necessary for us to consider the other contention raised on behalf of the respondent, namely, that on a proper construction of Clause 18, the purchaser is entitled to exercise the right conferred under that clause only where the claim for payment of a sum of money is either admitted by the contractor, or in case of dispute, adjudicated upon by a court or other adjudicatory authority.
Therefore the appellant had no right or authority under Clause. 18 to appropriate the amounts of other pending bills of the respondent in or towards satisfaction of its claim for damages against the respondent and the learned Judge was justified in issuing an interim Injunction restraining the appellant from doing so.
As held by the Hon'ble Apex Court in UNION OF INDIA VERSUS RAMAN IRON FOUNDRY [1974 (3) TMI 105 - SUPREME COURT], where the claim is admittedly one for damages for the alleged breach of terms of the contract executed between the parties a petition for winding up does not lie. It has held that a claim for unliquidated damages does not give rise to a debt until the liability is adjudicated and damages assessed by a decree or order of a Court or other adjudicatory authority.
In the instant case also, the claim is one for compensation for damages suffered on account of the alleged non-supply of vehicles which fact is disputed by the respondent and it is stated that the Trucks have been supplied and three Trucks continues to remain with the petitioner even after completion of the contract. The fact of the three Trucks being in the possession of the petitioner, is also admitted by the petitioner.
Petition dismissed.
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2018 (12) TMI 1676
Release of property - HELD THAT:- The OL has in this report agreed to the request of the said Bank for releasing the property situated at A-2/2-25, Site B, Surajpur Industrial Area, Greater Noida, U.P. subject to IDBI Bank Ltd. agreeing to meet the liabilities of the workmen under Section 529 A of the Companies Act, if any, and also the cost of security provided to the property.
Application and report disposed off.
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2018 (12) TMI 1674
Attachment of Bank Accounts - Bank Accounts were attached prior to the Insolvency and Bankruptcy Code commencement date in view of the fact that the respondents have filed formal claim for their dues with the applicant - HELD THAT:- This bench takes a conscious decision under the powers granted to this Tribunal u/s 238 of the code that the Orders passed under Section 226 (3) of the Income Tax Act dated 16.11.2017 and 17.11.2017 by Income Tax Recovery Officer-4, Mumbai, Room No.210, Ayakar Bhawan, MK Road, Mumbai are hereby suspended forthwith and we further hereby direct the authorities concerned not to proceed further for the recovery of dues.
Resolution Professional are directed to approach the Banks with the copy of this order for the withdrawal of funds available in their respective accounts to keep the company as going concern.
Application disposed off.
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2018 (12) TMI 1549
Illegal detention of the applicants - investigation u/s 212(3) Companies Act, 2013 - period of limitation - seeking Ad-interim ex parte release of the applicants from the alleged illegal arrest - investigation carried out by the SFIO beyond three months period, specified in the said order dated 20.06.2018, and the arrest of the applicants on 10.12.2018, pursuant thereto - Held that:- The applicants are co-operating with the investigation. We must also add that no cogent material has been brought to our notice on behalf of the SFIO to urge that, the applicants are a flight risk or that they will misuse the liberty granted to them by this Court.
We must also add that, the applicants have deep roots in the society and belong to a respectable business family and have no criminal antecedents. Consequently, there is no possibility of their absconding and not being available for further investigation.
The issues framed in the present applications are answered in favour of the applicants and against the official respondents. We have already hereinbefore expressed our considered view that, the facts and circumstances of the present case do not admit the continued unlawful detention of the applicants.
In view of the foregoing, the present application is allowed. The applicants shall be released on interim bail, during the pendency of the accompanying petitions, on their furnishing a personal bond in the sum of ₹ 5,00,000/- each with two local sureties each of the like amount to the satisfaction of the trial court
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2018 (12) TMI 1548
Mediation and Conciliation - parties to the proceeding during the proceedings pending before this Tribunal as entitled to apply for mediation - Held that:- From a perusal of Section 442 as extracted above, it is seen that by virtue of Sub-section 2 of Section 442, any of the parties to the proceeding during the proceedings pending before this Tribunal is entitled to apply for mediation. A further reading of Section 442, more particularly sub-section 3 of Section 442 also gives suo motu powers to this Tribunal to refer any matter pertaining to the proceedings to such number of experts from the Mediation and Conciliation Panel. The provision of Section 442 has been made effective on and from 1.04.2014 and the Central Government has also framed the rule 6 titled as The Companies (Mediation and Conciliation) Rules, 2016.
Further, Central Government has also notified a Mediation and Conciliation Panel as displayed in the website maintained by Ministry of Corporate Affairs. In the present instance as already stated, even though the parties are in consensus for mediation but has failed to reach the consensus in relation to the mediator to whom the matter can be referred to for mediation. Taking into consideration the provisions of Section 442 of Companies Act, 2013 as well as the Rules as referred to above and the Mediation and Conciliation Panel as notified by the Central Government, the following two persons are appointed as mediators to mediate as between the parties.
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2018 (12) TMI 1547
Oppression and mismanagement - respondent has failed to act upon the conditions and assurances based on which they have invested in 1st Respondent and that the 2nd respondent’s investment was only qua the residential portion of the project - Held that:- When anyone purchases/subscribes to the share capital of a company, to say that such purchase/subscription relates only to a portion of the property/assets belonging to the company cannot be countenanced in law. It is the company which owns the assets and shareholders have shares in the company and not in specific assets or part of assets of the company. Therefore, we find the argument of 2nd respondent convincing.
Respondent failed to execute a new SHA with them to demerge the commercial portion of the project and incorporate the same in the Article of Association of 1st respondent - We are in agreement with the Respondent that 1st respondent being a public company cannot normally refuse to register transfer of shares from the original promoters to the appellants. As regards the issue raised by the appellant that the commercial portion of the project will be demerged in appellants’ favour is concerned, no fresh SHA or fresh agreement entered on the subject have been put up to establish that appellants have such right to commercial property. Further we have noted that the appellants were not even parties to the earlier SHA signed between the original promoters and the 2nd respondent and the appellant has himself stated in its communication dated 28.2.2012 that the SHA has become defunct since it was not incorporated in the Articles of Association of 1st respondent. The communication is prior to the date of transfer of shares in the name of appellant. Therefore, the appellants cannot be permitted to approbate and reprobate on the validity of the SHA to suit their convenience from time to time.
The nominee directors of 2nd respondent entered into a master collaboration agreement with 7th respondent for development of a school on the commercial area of the Project and that this is direct contravention of the appellants’ rights and amounts to oppression and mismanagement - We have gone through the arguments and perused the record and we are of the opinion that while 1st appellant was watching his family interest but the interests of 1st respondent should always remain paramount. Therefore, we are not convinced with the argument of 1st appellant. These are business decisions decided as per corporate procedure. We cannot substantiate our opinion in it when no arbitrariness is show.
As argued argued that 1st appellant’s allegation with regard to keeping of books of accounts of 1st respondent at the office of 2nd respondent and not at 1st respondent registered office, this is a gross distortion of facts, particularly when 2nd respondent does not have an office of its own in Hyderabad and the books are kept at 1st respondent registered office and are always available for inspection.
As regards appointment of director after the final order has been passed in the company petition, there was no relief granted to the appellant, the company is to be managed/regulated with respect to the provisions of Companies Act/Article of Association of the company. The retirement of the director and re-election or not to re-elect the director is the normal routine in the company matters. If a person is not re-elected after he has retired in terms of the Companies Act/Article of Association of the Company, no grievance of his re-election can be raised by a person.
As regards the other allegations regarding refusal to share information about 1st respondents’ litigation, acquisition of additional land for the Project, other affairs of 1st respondent, hindered the appellants’ access to company related information by illegally keeping books of account at 2nd respondent’s office instead of 1st respondent registered office is concerned, these are the issues relating to operational maters for running a company and grievance raised are quite vague for us to give directions. Appellants are free to adopt procedures under the Act and Rules. Appeal dismissed.
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2018 (12) TMI 1546
Power to refuse registration of transfer of shares in the Company to outsiders - sufficient cause - Board of Directors of Synthite Industries, which at the time concerned was deemed public company and which was in the process of conversion into a private company power to refuse registration of transfer of shares in the Company to outsiders - Held that:- Admittedly Article 24 of the Articles of Association was existing as a contract between the Appellant Company and the respective Respondents 10. Apart from that, Sub-Section (4) of Section 58 of the Act, itself provides for an Appeal if the public company “without sufficient cause refuses to register the transfer of securities. It is obvious that if there is sufficient cause, the transfer can be refused.
In the facts and circumstances of the present matter, looking to the above discretion, we are satisfied that the Appellant Company had sufficient cause to apprehend that Respondents No.10 in these Appeals were acting with a design and the original Petitioners had not purchased the share with bona fide object of investment. Respondent No.10 – Beena George held 2,640 shares of ₹ 100/- each in the Appellant Company but transferred just 25 shares. Appellant submitted that this could not be said to have been done with the bona fide object of trading but is rather attempt at introducing outsiders in the Appellant Company to get control and to create obstruction in the process which had been initiated by the Appellant Company of converting itself back to private limited company from a public limited company. We find the reason recorded by the Company to refuse to record transfers is based on reasonable apprehensions recorded in the letters sent to Petitioner. We do not wish to impose our wisdom on that of the Board of Directors which cannot be said to be arbitrary on lacking in bona fides. The decision was in interest of Company.
Going through the reasons recorded by the learned NCLT for allowing the Compny Petition, we do not find that the Impugned Orders are well reasoned. For reasons discussed above, we find that the Petitions deserve to be rejected.
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2018 (12) TMI 1545
Scheme of merger by absorption as proposed by the Appellant wholly accepted by the National Company Law Tribunal, Mumbai Bench, except with regard to changing the appointed date of the scheme - Conduct of Business during the Interim Period - Held that:- We hold that the appointed date of the scheme shall remain 1st April, 2017 as proposed by the Appellant. We make it clear that the Income Tax Authorities would not be hindered in any manner due to this scheme of merger.
They would be at liberty to proceed against Appellant No.1 – the transferee Company for Income Tax liabilities of Transferor Companies, irrespective of the appointed date of the scheme, in accordance with law and if there is any difficulty, and need arises, as per law, they would be at liberty to proceed even against the erstwhile persons, members/directors of Appellants 2 to 4, holding them also liable.
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2018 (12) TMI 1544
Scheme of merger by absorption - Held that:- The petitioner-companies have complied with all requirements as per directions of the Tribunal and they have filed necessary affidavits of compliance in this Tribunal. Moreover, the petitioner-company undertake to comply with all the statutory requirements if any, as required under the Companies Act, 2013 and the Rules made thereunder whichever is applicable.
The scheme of merger by absorption appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to public policy.
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2018 (12) TMI 1436
Offering corporate guarantee for the loan availed - outstanding liability under a corporate guarantee offered at the instance of the petitioner - Held that:- The petitioner had deliberately made false averments with respect to the loss of shares and its consequent formal reporting with the police. It is not denied that loan was availed from Celica Developers P. Ltd., by Apsom Turner in which the petitioner alone had interest being a director on its board and his wife holding a major stake therein. This Bench is unable to appreciate the petitioner's stand that the respondents cannot hold on to a security in the absence of a written agreement. Under such circumstances the right to claim the shares or to redeem the pledge cannot be adjudicated by this forum. The pledge of shares necessitates only possession to be handed over. The pledgee has a right to hold on to them as security in the event of bailing out the pledgor, till he is duly paid. The respondents submit that they are ready and willing to return the shares upon their claim being satisfied.
No merit in the prayer made by the petitioner. This Bench does not find it equitable to direct the respondents to hand over the share certificates over which they assert their lien having bailed out Apsom Turner P. Ltd., by liquidating the outstanding liability under a corporate guarantee offered at the instance of the petitioner. The entitlement of the respondent to recover their claim is already a subject matter of adjudication. Should the suit, for recovery be adjudicated in their favour, they would well be within their rights to appropriate the proceeds under the shares in execution proceedings if the pledge is not redeemed. It would be grossly inequitable to direct the respondent to hand over the security to the petitioner without the claim of the respondents being satisfied. On payment of the guaranteed debt in full, the surety is entitled to all securities assigned to him, which can only be adjudicated by a civil court.
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