TMI Blog2018 (9) TMI 1608X X X X Extracts X X X X X X X X Extracts X X X X ..... tained any record, particularly with the regard to the payment, if any, of subscription money for 25,000 of shares subscribed. Even, he did not file PAS-3 to intimate the RoC of the allotment of shares being made by the Company. The defence of the Petitioner that the Respondents have fabricated all the record relating to the 1st Respondent Company is hollow and therefore, stands rejected. Thus, the issue raised under stands decided against the Petitioner, as he is not legally entitled to seek relief under prayer ‘D' - TCP/107/2016 - - - Dated:- 2-8-2018 - CH. MOHD SHARIEF TARIQ, (JUDICIAL) For The Petitioner(s) : Mohan Pulickkal, Narayanan P. Potty and Mrs. Ambili Menon P. Counsels For The Respondent(s) : Dr. K.S. Ravichandran, PCS and Ms. S. Manjula Devi ORDER Per : CH. MOHD SHARIEF TARIQ, MEMBER (J) 1. The Company Petition TCP 107/2016 was filed on 12.10.2012 before the erstwhile CLB under Sections 397, 398 and 111(4) of the Companies Act, 1956. The Petition has been transferred to NCLT and renumbered as No. 91/2012. 2. There is one Petitioner and four Respondents. The 1st Respondent is a Company, the Respondent Nos. 2 and 3 are husband and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n to the Petitioner and these documents included the share certificates issued in the name of the Petitioner. 6. The Petitioner has stated that he has issued a Registered Letter dated 11.01.2011 with Acknowledgement Due to the 2nd Respondent asking him to bring back all the documents. The true copy of the said letter dated 11.01.2011 is placed on record as Annexure A5. But, there was no response from the 2nd Respondent. Then, the Petitioner filed a Police complaint against the 2nd Respondent, seeking seizure of books and record of the 1st Respondent Company. The copy of the complaint dated 16.04.2011 is placed on record as Annexure A6. 7. The Petitioner states that having come to know that 2nd Respondent is proposing to alienate the landed properties of 1st Respondent Company with the documents of title deeds taken away by him from the Company s Registered Office, the Petitioner approached the Munsiff s Court, Ernakulam seeking an order of injunction restraining 2nd Respondent and his agent from alienating the property of 1st Respondent Company. The said Court vide its Order dated 14.03.2011 restrained the Respondents from alienating the Company s properties. The Order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber are fabricated to defraud the Petitioner. 11. It has been contended by the Petitioner that all meetings that had actually taken place were chaired by the Petitioner and he has signed the Director s attendance Register and in no such meetings a decision to appoint the 3rd Respondent as Director was taken, and without the presence of the Petitioner there would be no required quorum for Board Meeting. So, without the consent and knowledge of the Petitioner, the 3rd Respondent could not have been validly appointed at any Board Meeting, and if 3rd Respondent is appointed as additional director, the appointee should vacate his office at the subsequent to Annual General Meeting. But, there is no record of the reappointment of 3rd Respondent as Director at the subsequent Annual General Meeting of the Company. In short, the Petitioner assails the appointment of the 3rd Respondent as Director stating that the same is invalid and illegal and liable to the set aside. 12. The Petitioner has also challenged the transfer of 5000 shares held in the name of 2nd Respondent in favour of 3rd Respondent which have been transferred on 16.08.2008. The information with regard to such transfer wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he call monies on shares on due dates and the latter section deals with disqualification on the ground of non-attendance of three Board Meetings. The Petitioner contends that he being the subscribers to the Memorandum of 1st Respondent Company shall be deemed to have agreed to become member of the Company and on its registration, his name has been entered as Member in the Register of Members of the 1st Respondent Company and in the absence of any formal allotment of shares or any calls being made as due on specific dates or any time limit prescribed for remitting the share money, any disqualification of directorship under Section 283 (1) (f) of the Companies Act, 1956, cannot arise or occur and much less any disqualification for membership of the Petitioner in 1st Respondent Company. The Petitioner has further submitted that even assuming but not conceding that he has not remitted the share subscription amount, if the applicability of Section 283 (1) (f) has to be invoked, the disqualification is to take effect upon the expiry of 6 months from the due date of non-payment of the call monies and there was no demand served on the Petitioner to pay up any amount in that respect. 15. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said allotment is invalid and illegal. 18. The Petitioner has contended that the Respondent No. 2 has filed Balance Sheets and Reports of 1st Respondent Company for financial years 2008-2009 and 2009-2010, on 01.02.2011 and the belated filing is being done by grossly manipulating the original version of the Balance Sheet and Reports approved by the Board and adopted by the shareholder were fudged in collusion with signing partner of the Auditor Firm, Mr. Tinu Anto, Chartered Accountant, who is a close relative of the 2nd Respondent, so as to unduly favour the Respondent Nos. 2 and 3. 19. In the premises, the Petitioner has prayed for granting reliefs as follows:- A. An order declaring that the conduct of the Extraordinary General Meeting of the Company held on 05.02.2011 and the increase of the authorized capital of the Company as per the resolution passed thereat are illegal, null and invalid. B. An order declaring that the transfer of 5000 shares of the Company from the name of the second Respondent in favour of the third Respondent on 16.08.2008 is invalid, null and void and directing the 1st Respondent to rectify the Register of Members accordingly. C. An order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to carry out an investigation into the affairs of the first Respondent Company in the light of the submissions made in this petition. O. Such other further order as may be deemed fit by this Hon ble Bench on the facts and in the circumstances of the case. 20. The Counter Statement has been filed by the Respondents 1 to 4 wherein all the allegations contained in the Petition have been denied except to the extent specifically admitted by the Respondents. It has been submitted that the action of the Petitioner is accentuated by mala fides as he has suppressed vital and material facts and has filed the Petition for a collateral purpose. The Respondents have stated that the Petitioner did not come to the Court with clean hands, therefore the Petition deserves to be dismissed in-limine. 21. The Respondents have submitted that the case of the Petitioner is that in the Memorandum of Association, he had subscribed for 25,000 equity shares constituting about 50% of the share capital of the Company, but as on the date of filing the Petition, his name does not appear in the Register of Members of the Company. Therefore, he is not entitled to invoke the jurisdiction of this Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Petitioner has also filed a complaint before the police on the allegations of misappropriation of Crores of Rupees and falsification of documents of the 1st Respondent Company. He has also filed a civil suit before the Court of Principal Munsiff, Ernakulum for restraining the Respondents from selling immovable properties of the 1st Respondent Company, on the basis that all the documents pertaining to the immovable properties have been taken away by the Respondents. 25. It has been brought on record by the answering Respondents that the Demand Notices dated 26.06.2010, 21.08.2010 and 25.09.2010 were issued to him by the Company on the strength of the resolution of the Board of Directors dated 26.06.2010, 21.08.2010 and 25.09.2010, he did not respond at all, and as a result unpaid shares were forfeited after due notice to him as decided in the Board of Directors meeting held on 22.11.2010. The answering Respondents have also stated that the forfeiture of shares were intimated to the Petitioner by notice dated 01.12.2010, the notices sent to the Petitioner calling for remittance of share subscription money are placed on record as Annexure-R4 (series). The copies of the mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s shareholder nor a director of the 1st Respondent Company. But, he seems to be playing with certain inconsistencies in the particulars furnished which per-se did not constitute the act of falsification of record or even oppression and mismanagement in relation to the 1st Respondent Company. 29. The answering Respondents have also submitted that the EoGM held on 05.02.2011 wherein the resolution was passed to increase the authorized share capital of the 1st Respondent Company was duly convened after issuance of notice to all the shareholders and resolution was validly passed to increase the authorized capital of the 1st Respondent Company. The authorized share capital was increased to ₹ 125 lakhs in the said EoGM, and thereafter the shares were duly allotted to Respondent Nos. 2 and 3 on 18.02.2011. The copy of the minutes of the EoGM dated 05.02.2011 and minutes of the Board of Directors meeting dated 18.02.2011 are placed on record as Annexures-R10 R11 respectively. It has specifically been mentioned that the Board of Directors meeting was duly held on 18.02.2011 after issuing notice to the directors and resolution was passed to allot shares to the Respondent Nos. 2 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... civil suit filed. Thus, having chosen a forum and remedy, he cannot conveniently invoke the jurisdiction of all the courts in the country. Thus, he has no locus standi to seek indulgence of this Tribunal into the several allegations which according to him constitute oppression and mismanagement. Based on the reply, the answering Respondents have submitted that since the allegations of fraud, fabrication, collusion and criminal conspiracy have neither been pleaded with requisite substance nor been proved despite sufficient opportunity. Therefore, the Respondents prayed to dismiss the Petition with exemplary costs and render justice. 33. The Petitioner has filed the Rejoinder wherein he has denied the allegations levelled by the answering Respondents in their reply and have reiterated the contents of the Petition. The Respondents have also filed the Sur-Rejoinder wherein the contents of the reply have been reiterated, therefore the same is not repeated for the sake of brevity. 34. In view of the pleadings recorded herein above, the only issue that arises is as to whether or not the petitioner is entitled to get his name entered in the register of the members of the 1st Respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal Commissioner in the Income Tax Department, and he did not discharge the basic burden of proving that he had contributed the money to the Company, to the tune of ₹ 25 lakhs towards the money payable by him for the shares as subscribed and share application money of ₹ 88.10 lakhs aggregating to ₹ 1,13,10,000/- The respondents would further contend that the Petitioner claims that the shares have been allotted to him and necessary share certificates were also issued to him, but he has not produced any paper and when confronted with the above challenges, has cooked up a story stating that in the first week of January 2011, he had come to know that the Respondent No. 2 had taken away the books and records including Title Deeds of the 1st Respondent Company and as on the date of filing the Petition, his name does not appear in the Register of Members of the Company. As per Respondents, Petitioner is not entitled to invoke the jurisdiction of this Tribunal under Sections 397/398 of the Companies Act, 1956, unless until he succeeds in his prayer for rectification of Register of Members and gets back as member of the Company. 36. As per the pleadings it is admitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Respondents have also stated that the forfeiture of shares were intimated to the Petitioner by notice dated 01.12.2010, the notices sent to the Petitioner calling for remittance of share subscription money are placed on record as Annexure-R4 (series). The copies of the minutes of the Board of Directors Meeting dated 26.06.2010, 21.08.2010, 25.09.2010 and 22.11.2010 are placed on record as Annexure-R5 (series). The Respondents would further contend that the Petitioner has lost his membership by his own fault as his shares have been forfeited by the 1st Respondent Company, which has lien on his unpaid shares, resultantly he has no locus to file this Petition. It also reveals from the minutes of the meeting dated 22.01.2011 that since the Petitioner being director failed to attend the three consecutive Board Meetings on 22.11.2010, 10.01.2011 and 22.01.2011, he had vacated his office as per law. 39. In order to ascertain the lien on the unpaid shares/powers of the board of directors of 1st Respondent Company to forfeit the same, we may refer to the provisions of the ARTICLES of ASSOCIATION of the company and other record placed on the case file. Para numbers 20 21 of the ARTICLE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the money in respect of shares held him within 6 months from the date fixed for payment, the director will automatically vacate office. Further pursuant to Section 283(l)(g) of the Act, the office of the director will automatically stand vacated, if the director absents himself from three consecutive meetings of the Board. The Board noted that by violating the above provisions, Mr. C.J. Mathew has already vacated office. The board after deliberations passed the following resolution: RESOLVED THAT the vacation of office of Mr. C.J. Mathew as director be and is hereby noted by the Board . 42. It is also on record that on 22.11.2010 the Board of Directors of the 1st Respondent Company has forfeited the shares of the Petitioner. The copy of the Minutes of the Board of Director s meeting is placed at page 75 of the typed set filed with the reply. The relevant Minutes of the Board Meeting dated 22.11.2010 are extracted below:- 02. Forfeiture of Shares: RESOLVED THAT pursuant to Article No. 21 of the Articles of Association of the Company and other applicable provisions, if any, of the Companies Act, 1956 consent of the Board of Directors of the company be and is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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