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2017 (3) TMI 1007 - Tri - Companies LawSiphoning of funds by commercial transaction/agreements with related parties - misdeeds committed by Directors - Held that:- There appears financial irregularities in the company which is prejudicial to the interest of the company. However, all the loss to the company on account of financial irregularities can be ascertained by an appointment of an Independent auditor who may conduct the audit of the company from the financial year 2008-09 and onwards to find out the exact loss caused to the company on account of siphoning, related party transactions and other misdeeds, committed by Directors of the Company. As it is expert job we have not entered in details of allegations except few samples to conclude that there is prima facie case of financial mismanagement. Auditor shall enquire into the loss, if any, caused to the company and such loss, to be recovered from the party whoever is found responsible, from his/their personal resources and the amount so recovered will be paid to the Company. Respondent Nos. 3 to 7, Directors of Respondent No. 1 company are directed to provide inspection of accounts and records of Respondent No. 1 company to the Auditor and also to the Petitioners who are shareholders of Respondent No. l company. The auditor shall give opportunity of hearing to both the parties. Respondent Nos. 3 to 7 directors of Respondent No. 1 company are directed to assist the auditor and furnish relevant documents as and when asked for. The auditors shall fix their remuneration in consultation with the Respondent No. 1 Company, to be paid by Respondent No. 1 Company. In case of any difficulty in implementation of the directions, liberty is given to file appropriate application before this Tribunal. In the light of aforesaid discussions M/s. Price Water Cooper is appointed as an independent auditor, who shall comply the aforesaid directions and submit its report within three months.
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