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TMI Blog2017 (10) TMI 1133X X X X Extracts X X X X X X X X Extracts X X X X ..... t company subject to payment of Rs. 180.00 lacs by the petitioners to the first respondent company. The mode of payment agreed between the petitioners and respondents No. 2 to 4 is as follows: - (i) Within 1.5 to 2 months Rs. 100.00 lacs were required to be paid; (ii) Rs. 40.00 lacs to be paid out of share of profit for the year ended on 31.03.2011 and so on; (iii) Rs. 40,00 lacs after one year Over and above what has been stated above (iv) interest free loan of Rs. 20.00 lacs repayable after two years within a period of 1.5 to 2 months (v) Rs. 150.00 lacs as letter of credit facility from Citi Bank (vi) Equal participation in the equity holding of both petitioners and respondents in the R1 company. 02. As agreed between the parties on 17th January, 2010, authorised share capital of the first respondent company was increased from Rs. 50.00 lacs to Rs. 75.00 lacs in order to accommodate the issue of further shares to the petitioners. Between 12th January, 2010 and 18th January, 2010 petitioners have issued cheques for Rs. 32,98,500/- towards the share application money for 329850 equity shares of Rs. 10/- each being the 50% of equity participation in the first r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y but he was not permitted to enter the premises of the office. On 26.07.2010, petitioner No. 1 was also not allowed to enter premises of the first respondent company for verification of accounts, but on much insistence he was permitted to enter the premises. The said incident was reported to Halol Police. In the Police Station, respondent No. 2 agreed to permit petitioner No. 1 to enter into office of the first respondent company only if petitioner No. 1 signs cheques towards payment of salary of workers. Petitioner No. 1 agreed for the same. Petitioner No. 1 again came back with those cheques but respondent No. 2 did not turn up. On 29.07.2010, Mr. Mahesh Patel went to respondent No. 2 with signed cheques and an authority letter on behalf of petitioner No. 1 but respondent No. 2 refused to accept the cheques and asked Mahesh Patel to check out the mails sent by respondent No. 2. On 29.07.2010 in the evening one truck was loaded with the goods such as table, chairs, cupboards, etc. from the premises of first respondent company. Representative of the petitioners Mr. Mahesh Patel gave a report dated 30.07.2010 to Halol Police Station complaining about the aforesaid activities of res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (5) To compensate for undue hardship faced by them from the respondents. 06. Second respondent who is Managing Director of the first respondent company and having been authorised by respondents No. 3 to 5, filed the reply. 07. It is plea of the respondents that the disputes between petitioners and respondents arisen out of mutual understanding that came into existence on 17.01.2010 and therefore it is beyond the scope of this Tribunal and cannot be enforced nor its breach does not give any cause of action to file a petition under Sections 397 and 398 of the Companies Act, 1956. Petitioners cannot seek any specific performance of the private agreement came to be in existence through some understanding between the parties on 17.01.2010. Mere lack of confidence among two group of shareholders cannot be called as an act of oppression. Petitioner No. 7 is not a shareholder of the first respondent company and he joined in the petition and it amounts to mis-joinder and on that ground alone petition is liable to be dismissed. It is the version of the respondents that they never contacted the petitioners for financial assistance but on the other hand it is the petitioners who approache ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioners, Rs. 31.00 lacs have been adjusted against share application money and balance Rs. 69.00 lacs is lying in the credit of the petitioners as unsecured loan. As per the agreement one of the Directors among petitioners have to sign the cheques after verifying the invoices, vouchers etc. and only those cheques which was signed by the petitioner group were allowed to be signed by one of the Directors of respondent group shareholders. Since June, 2010 Mr. Ravindra Mehta, (Petitioner No. 3) did not return the cheques sent for his signature and as a result the first respondent company could not make payment towards the salary of staff and also towards payment of provident fund, ESIC etc. In order to facilitate the timely payment towards salary, electricity bills, PF contribution etc. the first respondent company opened another bank account in the name of the first respondent company for a short period. Further it is stated that petitioners No. 1, 2, 4 and 6 were appointed as Additional Directors and their period ended by 20.09.2010 on which date the Annual General Meeting of the shareholders of the first respondent company was held for the year 2009-10. In the meeting the petitioners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondents that, in terms of the understanding Petitioners No. 1 to 6 were eligible and entitled to have 50% of the share capital of the first respondent company but petitioners were not inclined to subscribe for further 19,843 equity shares issued to the petitioners, on their persistent demand, were aimed to acknowledge the entitlement and the same do not have any legal force /value because they do not represent any securities created by the first respondent company in accordance with law. Petitioners have paid total amount of Rs. 2,08,99,250/- as under: Sr. No. As per MoU Actual investment made by petitioners Remarks 01 Rs. 100.00 lacs immediately within 1.5 to 2 months Rs. 100.00 lacs within 2 months On time 02 Rs. 40.00 lacs after one year Rs. 40.00 lacs - NA 03 Rs. 40.00 lacs from the profit portion of petitioners of subsequent years Rs. 40.00 lacs - NA 04 Rs. 20.00 lacs immediately (interest free loan and repayable after two years) Rs. 20.00 lacs - after 2 months On time 05 Rs. 150.00 lacs immediately as working capital finance from Citi Bank or from personal source Paid Rs. 88,99,250/- only within 3 months, from their personal sources Appro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the bank. In fact petitioner pressurises respondents to discontinue working capital facilities which were enjoyed by the first respondent company from State Bank of India stating that they would arrange credit facilities from Citi Bank. 15. It is stated in the affidavit in reply filed by the petitioners that in the Annual General Meeting held on 30.09.2014 respondents have not considered 19,843 equity shares of the petitioner for the purpose of voting by poll. The share certificate number 87 for 4921 equity shares issued to Mr. Ravindra U. Mehta (petitioner No. 4) and certificate number 88 of 14922 to Mr. Vikesh I Patel (petitioner No. 2) were not considered by respondents for the purpose of voting held by respondents No. 2 and 3 and thereby deprived the rights of voting of the petitioner. It is stated in the affidavit filed by the petitioners that ordinary resolutions were not passed with requisite majority as mentioned in Section 114 of the Companies Act, 2013. 16. Admittedly, there was an understanding between petitioners and respondents No. 2 to 4 on 17.01.2010 in a meeting which took place in Mumbai. Minutes of the meeting held on 17.01.2010 was reduced into writing and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wards share application money and balance amount of Rs. 69.00 lacs is lying in the credit of petitioner as unsecured loan. In order to allot shares, it is not only payment of share application money but there must be submission of share application form. A perusal of annexure "H" attached to the reply show that the share applications are there only for allotment of 3,10,000 shares and accordingly 3,10,000 shares were allotted to the petitioner. It is alleged by the petitioners that although the share certificates were issued to them for the remaining 19850 shares, they were not shown in the return filed with the Registrar of Companies and those shares do not bear seal of the company. For this, explanation given by the respondents is that, for the record purpose on insistence by the petitioners, certificates in respect of 19850 shares were given without seal and authority of the company. This allotment of shares took place on 11.03.2010. Petitioners are alleging that although share capital money is paid officially, shares were not allotted in respect of 19850 shares. If, really petitioners were aggrieved for not allotting 32,3,29,850 shares, then they should have raised the said iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Dhanlaxmi Bank, it appears that, State Bank of India also asked Dhanlaxmi Bank to freeze the account of the first respondent company and accordingly, Dhanlaxmi Bank freezed the account. 20. Therefore, the action of the respondents to open a bank account in the name of the first respondent company without consent of petitioners, is an act which should not have happened. Mere opening a bank account of the company in another bank itself per se (sic) an act of oppression unless and until it is shown the funds of the first respondent company is not (sic) siphoned by the respondents into their personal accounts and to use for their personal purpose. In this angle no evidence is forthcoming from the petitioners. In the Chartered Accountants' certificate it is certified that all the transactions done through Dhanlaxmi Bank are exclusively for the business activity of the first respondent company. 21. Admittedly, petitioners 1, 2, 4 and 6 were appointed as Additional Directors in the Board of the first respondent company on 25.03.2010. It is known to one and all that Additional Directors seize to hold their office on the date of Annual General Meeting of the respective year. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... binding either on the shareholders or on the company. In the case on hand, the understanding that was reached between the petitioners and respondents No. 2 to 4 on 17.01.2010 has not been included in the Articles of Association and in case of breach of the terms of such understanding, the petitioners cannot take their redressal by recourse to company Tribunal under Sections 397-398 of the Companies Act, 1956 or at present under sections 241-242 of the Companies Act, 2013. 23. Coming to the terms of MoU petitioner shall provide Rs. 20.00 lacs as unsecured loan without interest and arrange for Rs. 150.00 lacs working capital from Citi Bank. According to the respondents', because of the petitioners unintended promise they lost an opportunity of getting working capital facility from the existing bank State Bank of India and other banks. It is the case of the petitioners, inspite of their best efforts they could not get working capital limits of Rs. 150.00 lacs from Citi Bank on the ground that the norms of the first respondent company do not fit in with the norms of Citi Bank. Therefore, all said and done it is also a breach on the part of the petitioners. Petitioners themselves plea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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