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TMI Blog2015 (11) TMI 1702X X X X Extracts X X X X X X X X Extracts X X X X ..... riod of two months from the date of their appointment. In this regard the said Salahuddin Nalakath failed to pay for the share subscription amount in respect of the equity shares as agreed to be subscribed by him under the memorandum of the R1 Company within the time period specified in section 270 of the Companies Act, 1956 and thus vacated his office as director on 05.11.2003 under the provisions of section 283(1)(a) of the Companies Act, 1956 as he failed to hold the requisite qualification shares within the time stipulated. Soon after the incorporation of the respondent company the 2nd respondent was admitted as a director of the respondent company on 29.08.2003. It is submitted that the R1 Company did not issue any shares to the 2nd respondent at any time after its incorporation. While the petitioner was all along managing the affairs of the respondent company, to the shock and surprise of the petitioner the 4 respondent solely with an intention to usurp control over management of the respondent company, and more particularly the land that is owned by the R1, filed an affidavit in the civil suit bearing O.S. No. 82/2006 on the 26.07.2001 and stated that the petitioner, who is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the 1st holder and the petitioner was forced to sign it as a 2nd holder. The petitioner submits that the transfer deeds executed by the petitioner is invalid as the date of presentation of the said transfer deed was 16.11.2010 and the same has not been revalidated before its acceptance in a board meeting, even if is to be assumed that such a board meeting was in fact conducted. The above referred transfer deed contains the joint signatures of both petitioner and the 2nd respondent as the transferors, for transfer of 100 equity shares of the respondent company as if to imply that the petitioner and the 2nd respondent are the joint holders of such 100 equity shares, which is invalid and erroneous. The following are the Oppressive Tactics and Acts of Mismanagement employed by the 3rd respondent: The petitioner was informed on the 13.12.2011 by a friend of his that the 4th respondent had called him to state that the petitioner is no more a director of the R1 Company. Immediately thereafter, the petitioner caused an inspection of the records of the respondent company from the portal of the Ministry of Corporate Affairs, www.mca.gov.in, the petitioner became aware of the malicious ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e acts of inducting directors and transferring shares including the shares of the petitioner without proper notice to the petitioner are all mala fide acts designed to usurp the R1 Company and to usurp the belonging to the R1 Company and also constitute clear breach of trust and the faith that the petitioner had reposed in the 2nd respondent. All the above acts of the 2nd respondent should have been done only with the express approval and consent of the petitioner and only in a duly convened board meeting wherein the petitioner was also present. Whereas neither has such board meeting been convened nor did the petitioner receive any notice of such board meetings and it is submitted that the said appointment, cessation and transfer of equity shares are all improper and void ab initio for want of quorum, as the purported board meetings said to have been held on 25.09.2011 for the appointment of respondents 3 & 4 as director and the purported board meeting said to have held on 15.11.2011 for changing the designation of the petitioner and recording the purported transfer of equity shares of the petitioner to the 4th respondent have in fact never been convened. The impugned filings were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... directorial grievances and have nothing to do in his capacity as a shareholder, even if it is assumed without admitting that he is a shareholder of the R1 Company. The factual aspect with regard to the appointment of the 2nd respondent as a director of the R1 Company is admitted. The other contents such as acts of oppression and mismanagement etc are all a figment of the imagination of the petitioner and without any factual basis. Hence the same are denied categorically. It is not understood how a person who was the managing director of the R1 Company until recently could impute motives to the other directors when substantial powers of management were vested in him. This is only an attempt to escape from his responsibilities in as much as the R1 Company's status was reflected as 'dormant' until recently because of non-tiling of statutory returns. It is submitted that the board of directors of the R1 Company, at its meeting held on 28.05.2011 at the registered office, considered and approved the transfer of shares 10 the extent of 330 shares each held by the 4th respondent, to and in favour of the 2nd and 3rd respondents. A copy of the minutes of the meeting of the boar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purchase was completed was also to vest in the R1 Company. The petitioner herein cannot claim any ownership rights over the lands where an interest stands created in favour of the R1 Company by virtue of an agreement dated 22.07.2003. The respondents respectfully submit that the 'Meezan Group' mentioned in the affidavit sworn by the 4th respondent herein before the Sub Court-III, Kozhikode not an imaginary entity but collectively refers to Meezan Jewellers Ltd. Meezan Realtors Pvt. Ltd. and Walker Foot Care etc, which are under the same management, as the affidavit itself makes it clear in para 3 thereof. It is further submitted that even though MEEZAN REALTORS PVT. LTD. and MEEZAN JEWELLERS LTD. are separate legal entities the management and control of both are in the hands of the same persons indicating the existence of anexus between the two companies. The petitioner has not at all denied the conduct of the general meeting of shareholders. The meeting conducted in respect of each of the group companies of the Meezan Group, revived to confer the 4th respondent with power to manage the affairs of the Meezan Group of companies, which includes the R1 Company. Hence the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said meeting, it was resolved to transfer the management and control of the R1 Company from the hands of the petitioner to the 4th respondent. In pursuance of this decision and in complete accord therewith the petitioner tabled before the board duly signed share transfer form to transfer all the shares held by him to the 4th respondent, which was unanimously approved in the meeting, Thus the petitioner is not holding any shares in the R1 Company. Therefore he is not a member of the company and has no business enquiring into the affairs of the R1 Company. If the share transfer forms are invalid as alleged, the petitioner has to take full responsibility for the same since it was he who presented the forms. It is noteworthy that the petitioner has not denied his signatures on the forms, and the only aspect that is being impugned now is that the 2nd respondent has also signed the forms as if he were a joint holder of the shares. The petitioner, knowingly fully well that the 2nd respondent's signatures were not needed as transferor, duly acquiesced in the process, and having done so then, he is stopped at this stage from questioning the validity of the process. In any case, he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese proceedings. The R1 Company has instituted the suit in OS No. 82 of 2006 and its board has to decide the authorised signatory, the petitioner is weaving a story in order to cover up the fact that the share transfer form was executed by him on 27.04.2011. The circumstances tinder which the meeting had to be called has already been explained hereinabove and hence not repeated for the sake of brevity. The petitioner having acquiesced in the transfer of shares on 27.04.2011, he wants to wriggle out of it now by using the bogey of coercion etc seven months after the event had taken place. The petitioner has raised this issue of threat to life etc only in this petition, which was filed before this Hon'ble Bench in December 2011. The petitioner did not find it proper to approach the police authorities to file a complaint if he was indeed threatened with death or bodily harm. Even if it is admitted for arguments sake that the validity of the share transfer forms was in question, the petitioner cannot be allowed to take advantage of his own wrong. It is submitted that in view of the fact that the entire shareholding of the petitioner stood transferred in favour of other w.e.f. 27.04 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t take advantage of his own wrong, that too eight months after the event, to challenge the transfer. Hence the petitioner has no locus standi to prefer or maintain this petition. Hence, it is most respectfully prayed that this Hon'ble Board be pleased to dismiss the above company petition in C.P. No. 100 of 2011, and thus render justice. 5. Heard the learned PCS and the counsel appeared for respective parties, perused pleadings and documents filed by them. After analysing the pleadings the only fell for consideration and need to be addressed whether the petition is maintainable under law? 6. Now I deal with the issue: The learned counsel for the respondents raised a preliminary issue regarding very maintainability of the company petition before this Bench on the ground that the petitioner ceases to be a shareholder of the company and the petition is not maintainable under section 399 of the Companies Act, 1956. He submitted that the petitioner has transferred his entire shares i.e. 1000 shares to the 4th respondent and executed a valid share transfer deed on 27.04.2011. After the above transfer of shares to the 4th respondent, the Board of directors of the R1 Company took not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the transfer of shares by the petitioner is legal and valid. Further the petitioner contends that he represented the company when the company filed a suit for specific performance against the defendant being OS No. 82 of 2006 before the Hon'ble Court of Subordinate Judge, Calicut. The R1 Company is the plaintiff in the suit however the petitioner represented the company in the capacity as managing director. The said stand cannot be a ground to contend that he continued to be a shareholder of She company or has any vested interest, further the 4th respondent filed an affidavit dated 26.07.2011 before the Hon'ble Sub-court in OS No. 82 of 2006 clarifying the position and stated that the petitioner had transferred his shares on 27.04.2011 itself and he ceases to be a director of the company and lost all association with the company. Hence it was prayed to delete the name of the petitioner from the cause title of the plaint being OS No. 82 of 2006. It is more clinching evidence regarding transfer of shares of the petitioner to the 4 respondent from the annual returns for the year 30.09.2011 wherein the transfer of shares of the petitioner was shown as transferred to the 4th re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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