TMI Blog1987 (9) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... paragraphs 30A to 30T as well as several additional prayers as set out in the schedule to the company application. The length of the amendments proposed could have been substantially reduced had the applicants applied themselves to if. But this is no ground for rejecting the application. Hence, I propose to consider the amendments on merits. Company Petition No. 573 of 1984 is a petition under sections 397 and 398 filed by the shareholders representing about 35 per cent. of the shareholding in the fifth respondent company, Reliable Extraction Industries Pvt. Ltd. Respondents Nos. 1 to 4 in the petition hold an aggregate of about 31 per cent. of the equity shares in the said company. Petitioners Nos. 1, 2, 3 and respondent No. 1 constitut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 as the chairman and managing director, removing petitioner No. 1 as the executive director of the company and appointing respondents Nos. 6, 7 and 8 as the executive directors of the company with immediate effect. The respondents have also allegedly convened a meeting of the newly constituted board of directors, which is challenged by the amendment. It is also the contention of the petitioners that respondents Nos. 7 and 8, who are allegedly the newly appointed executive directors of the fifth respondent company, have been involved in offences involving moral turpitude inasmuch as these respondents were arrested in connection with offences of criminal conspiracy to abduct, torture and extort money. They have been released on bail and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esented. This case does not support the contention of Mr. Chinoi. The judgment merely states that if a petition is validly filed and complies with all the requirements of sections 397 and 398 of the Companies Act at the date when it is filed, any subsequent withdrawal of consent by some of the shareholders would not invalidate the petition. The decision does not set out that subsequent events cannot be looked into in deciding a petition under sections 397 and 398 on merits. The second case relied upon by Mr. Chinoy was that of Shanti Prasad Jain v. Kalinga Tubes Ltd. [1965] 35 Comp Cas 351 (SC) at page 366. The court there held that it is necessary in a petition under sections 397 and 398 of the Companies Act to show that the conduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as applicable shall apply to all proceedings under the Companies Act. The provisions relating to amendment of pleadings would, therefore, apply to amendment of pleadings under the Companies Act. There is no bar to an amendment which incorporates subsequent events if the amendment is otherwise necessary for the proper determination of issues between the parties. In the case of Promode Kumar Mittal v. Southern Steel Ltd. [1980] 50 Comp Cas 555 , the Calcutta High Court has observed in a petition under sections 397 and 398 of the Companies Act that the court can take notice of all subsequent events to grant reliefs finally after trial in a company matter and the interim orders passed from time to time by the court in all applications, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are being conducted in a manner prejudicial to public interest or in a manner oppressive to any member or members. Similarly, section 398 deals with applications by members of the company who complain that the affairs of the company are being conducted in a manner prejudicial to public interest or in a manner prejudicial to the interest of the company or that a material change has taken place in the management or control of the company and by reason of such change it is likely that the affairs of the company will be conducted in a manner prejudicial to public interest or in a manner prejudicial to the interest of the company. These are all applications by members. In the case of Lundie Brothers Ltd., In re [1965] 2 All ER 692, a petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e company. The acts complained of affect them as shareholders also. In any case, this is a matter which can be looked into in depth at the hearing of the petition. The amendments cannot be rejected on this ground. In the premises, the judge's summons is made absolute in terms of prayer ( a ). Amendments to be carried out within one week. Liberty to respondents Nos. 1 to 4 to file an additional affidavit-in-reply in Company Petition No. 573 of 1984 confined to the amendments. Newly added respondents Nos. 6 to 9 to file their affidavit in reply within three weeks from being joined as respondents and served. Costs to be costs in the cause. Company Petition No. 573 of 1984 to be on board for hearing after six weeks. - - TaxTMI - TMIT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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