TMI Blog2004 (7) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... , the authorized capital was increased to ₹ 10 lakhs divided into 1000 shares of ₹ 1000 each was which further increased to ₹ 25 lakhs divided into 2500 shares of ₹ 1000 each. 2. The learned counsel for the petitioner submitted : The petitioner No. 1 Shri Mahendra Sahai, resident of T-34, Green Park Main, New Delhi-16 has been the Managing Director of the respondent-company since 21-10-1978 to 1-3-2002, when he was illegally removed from the post of Managing Director by the respondent No. 2 vide purported form 32 dated 1-3-2002 filed with the Office of Registrar of Companies. The petitioner No. 1 is holding 120 shares of ₹ 1000 of the respondent-company. The petitioner No. 2 Shri Ajit Sahai is also a shareholder of the respondent- company holding 36 shares of ₹ 1000 each and belongs to Shri Mahendra Sahai Group, petitioner No. 1. The petitioner No. 3 Shri Arjun Sahai is also a shareholder of the respondent-company holding 25 shares of 1000 each and belongs to the same group of Mr. Mahendra Sahai. The petitioner No. 4 Smt. Kamla Wati is also a shareholder holding 40 shares of ₹ 1000 each. 3. There are other members of the group who are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ointly purchased all the shares of the company in the ratio of 3:1. Even the directors were appointed in the same ratio of 3:1. As on 21-10-1978 the composition of Board of Directors was as follows:- (1)Shri Mahinder Sahai, Managing Director. (2)Chaudhry Harpal Singh, Director (3)Chaudhry Ajit Singh, Director (Finance) (4)Smt. Madhu Singh, Director. 6. Subsequently, Shri Chaudhry Harpal Singh expired on 12-6-1991 and Shri Ravinder Singh respondent No. 4 was taken on Board of Directors. Smt. Madhu Singh, resigned from Board of Directors on 1-9-995 and Shri Siddharth Singh was taken in her place. It was submitted that during the last one and half years, respondent No. 2 has illegally taken over as Managing Director of respondent-company. The petitioner No. 1 has not received any notice of the meetings of the Board of Directors of the company which he is entitled to as Director. Thus the petitioners are denied for participation in the affairs of the respondent-company. The respondent No. 2 debited and his family members for an Indian travelling under the head Tours and Travels in company s account. 7. The cinema hall has been closed on 14-3-2002 and thereafter the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the shares of the petitioners after bringing in the money in the respondent-company, which has been siphoned off by the respondents. 10. The Learned Counsel for respondents submitted:- The petitioner No. 1 Sh. Mahendra Sahai was a Managing Director of the company for over 23 years and has been managing the day-to-day affairs of the company till 1st March, 2002. Accordingly, the petitioners cannot allege any mis-management during that period. The petitioners group held 225 shares out of 977 shares fully paid up constituting 23.03% while the answering respondents group including the family members held rest of the shares i.e., 76.9% of the total share capital. Due to mismanagement by the petitioner No. 1, the company incurred huge losses and had to take loans from sister concern of the Respondents. The Cinema by name Chand was forced to be closed down and it was decided to start a commercial complex in the said premises. For this purpose more funds were required to be generated and to run the company and the petitioner was enable to generate such fund in the interest of the company. He has become very old and has been very ill since long. A meeting was called in accordance with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laim other and entirely distinct reliefs are precluded from raising the same and such omissions amounts to relinquish on the part of the Petitioners. The Learned Counsel for respondents has relied his contention at para 14 of the judgment of Hon ble Supreme Court Rajendra Tiwary v. Basudeo Prasad AIR 2002 SC 136 according to which a relief larger than one claimed by the Petitioner cannot be granted. The bar against the grant of the buy out relief is also highlighted by the fact that there exist no pleading on record to with respect to the said issue which not only militates against the general rules that the relief should be founded on the pleadings but also has precluded the respondents from contesting the same Bhagwati Prasad v. Chandramaul AIR 1966 SC 735. The Respondent submitted that lack of opportunity to meet the case, set up independent of any pleadings in support, has caused them grave prejudice. It was further submitted that respondent accept the proposal given by them to restore petitioner No. 1 as Managing Director of the company, the petition become infructuous and ought to be disposed of accordingly. It was further submitted that Petitioners should not be granted the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lared that the requisite quorum was present and called the meeting to order. No notice was issued for the Board Meeting purported to be held either of removal of Sh. Mahendra Sahai as well as appointment of Sh. Ajit Singh as Managing Director as admitted by the Learned Counsel for respondents during the arguments. Similarly, the respondents allotted 1523 shares to ₹ 100 each to themselves and their family members on 13-3-2002 plus reducing shareholding of petitioners from 23.03% to 9%. The respondents have failed to place any record of Board Meeting for allotment of this shares Form No. 2 filed with ROC is dated 1-3-2002 whereas the allotment was made on 13-3-2002 which indicates the mala fide intention of the respondents. The Board Meeting held on 19-6-2001 and the Form No. 32 filed by the Respondents are set aside. The Petitioner is reinstated as Managing Director of the company in place of Sh. Ajit Singh. The allotment of 1523 shares of ₹ 100 each allotted to the family members of the respondents on 13-3-2002 are also set aside. Both the parties are not in a position to work together and Managing Director was removed without proper notice and Board Meeting after the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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