TMI Blog2017 (11) TMI 1773X X X X Extracts X X X X X X X X Extracts X X X X ..... made out, it was not open to the Tribunal to pass order regarding interest, which is also against the provisions of the Interest Act, 1978. Even if it is accepted that the parties have agreed to sell out their shares, in absence of any power vested with Tribunal, after its specific finding there was no 'Oppression and Mismanagement', the Tribunal had no jurisdiction to direct any party to sell or buyout any share. Further finding about, the date of valuation/ buyout as the date closest to the filing of the petition i.e. 31st March, 2007 being perverse and contrary to the offer made by parties in the year 2008, and the order dated 25th February 2009, passed by Tribunal such order cannot be upheld. While we uphold the findings of the Tribunal in so far as it relates to failure of petitioners to prove 'Oppression and Mismanagement', the last part of the order and direction to the extent of sale of shares, date of valuation/ buyout and the order regarding payment of interest and the findings that the minority group have systematically whittled due to non-payment of dividend, and reduction in the number of directors being perverse, such portion of the impugned order are set aside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch of each of the financial year shall be taken. B. MIS Ernst Young, 6th floor, Wing B, Woridmark- 1, Aero city, IGI airport Hospitality District, Opp. Holiday Inn, Mahipalpur, New Delhi 110037 is appointed from out of the list of valuers submitted by the petitioners and agreed to by the respondents, as an independent valuer for fair value of the shares held by the petitioners of the company. The cut-off date for determining the value of the shares will be 31.3.2007 i.e. the date nearest to the filing of the petition. While computing the share value, the Valuers shall also consider the asset based valuation as the Respondent Company has a large asset base. Company Appeals (AT) Nos. 150 and 189 012017 C. The date of filing of the petition is April 2007. Hence, the said valuer will find out the fair value of the shares of the company as on 31.3.2007 on the basis of going concern by all recognised methods and applicable rules and regulations as applicable on the said date in this regard. The respondent company is being managed by the respondents only since the filing of the petition and thus, they are alone responsible for any increase or decrease in both the profita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e declined. K Interim Order, if any, stands vacated. This order disposes off all the pending company applications. L. No order as to costs. M. Let copy of this order be supplied to the parties and another copy to the independent valuer named above. N. In case of any difficulty in implementation of this order, the parties are granted liberty to mention the matter. 4. The Respondents (Appellants in Company Appeal (AT) No. 150 of 2017) have challenged the impugned judgment mainly on one of the grounds that the findings that returns to the minority group have systematically whittled due to non-payment of dividend and reduction in the number of directors and salaried employees is contrary to record. 1st Petitioner has been getting the same salary as 3rd Respondent (JMD), 1st Petitioner has continued to receive his salary, perks and all other incidental benefits from 2007 till the date of order without contributing or taking up any work in the Appellant Company, 10th Respondent/ i 0th Petitioner continues to be on the board as a non-executive Director, and Petitioners' group along with other shareholders has received dividend till 2011. 5. With regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t on valuation was provided to them before the Hon'ble High Court of Punjab and Haryana and the same was set aside vide order dated 4th August, 2010. It was also clarified that during the pendency of the appeal the proceedings were stayed before the erstwhile Company Law Board. (b) The Respondents/ Petitioners group during the pendency of the present petition has all along participated in the management of the Appellant Company for example: (i) Respondents/ Petitioners group all along represented on the Board of Directors through 1St Respondent and 10th Respondent. (ii) 1St Respondent continued to hold the position as a whole time director and received remuneration at par with members of the Appellant Group. (iii) 1St respondent and 10th Respondent regularly attended Board's meetings. It is the case of 1st Respondent that he had carefully examined and scrutinized all books and papers pertaining to the functioning of the company while discharging his duties as a working director. (iv) The Respondents Group accepted dividends by virtue of their shareholding till 2011. (c) Respondents/ Petitioners from the date of filing of the petition cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence and allegations. If he has not been appointed as Director in view of decision of the majority shareholders by resolution dated 10th January, 2017, the same cannot be held to be illegal. 19. Next, it was contended by the counsel for the Petitioners (Appellants in Company Appeal (AT) No. 189 of 2017) that the appointment of Shri Gursimran Singh Grew l as Managing Director is illegal. However, such allegation is not based on any evidence. 20. In this regard, it is desirable to notice the findings of the Tribunal which is as follows. 21. The Tribunal held that no evidence has been produced by petitioners to show that 9th Respondent did not perform any work and since she has passed away and there is no cogent evidence to show that 9th respondent was paid without performing any work and the petitioners never raised such issue till the filing of the petition, such allegation cannot be accepted. 22. The Tribunal further held that 8th Respondent held relevant educational qualification and had requisite experience and the Petitioners have not pressed the allegation regarding payment and salary against him. 23. The Tribunal also held that there is no infirmity in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a definite conclusion that the Company's affairs have been or are being conducted in a manner prejudicial or oppressive to any member or members or prejudicial to public interest or in a manner prejudicial to the interests of the company and that to wind up the company would unfairly prejudice such member or members, then only with a view to bring to an end the matters complained of, may make such order as it thinks fit including the order in terms of sub-section (2) of Section 242. 32. In the present case, the Tribunal has come to a definite conclusion that the Petitioners (Appellants in Company Appeal (AT) No. 189 of 2017) have failed to make out a case of 'Oppression and Mismanagement'. Having given such findings, we are of the view that the Tribunal had no jurisdiction to pass, any order in terms of sub-section (1) or (2) of Section 242 of the Companies Act, 2013. 33. Learned Counsel for the Respondents (Appellants in Company Appeal (AT) No. 150 of 2007) has rightly contended that the Tribunal has failed to notice that the 10th Respondent! Petitioner continued to be on the Board as its non-executive Director, and the Petitioners' group along with other sh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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