TMI Blog2020 (2) TMI 762X X X X Extracts X X X X X X X X Extracts X X X X ..... ncial statements and siphoning of funds from the appellant company, therefore, direct to appoint an independent auditor who can perform audit of the financial mismanagement and siphoning of the funds of the appellant company. Appeal dismissed. - Company Appeal (AT) NO. 01 OF 2019 - - - Dated:- 20-1-2020 - Justice Jarat Kumar Jain Member (Judicial), Mr. Balvinder Singh Member (Technical) And Dr. Ashok Kumar Mishra Member (Technical) For the Appellant : Mr Pankaj Jain, Advocate For the Respondent : Mr. Ashim Sood, Mr Rhythm B, Mr. Aditya Kumar, Advocates JUDGEMENT JUSTICE JARAT KUMAR JAIN, MEMBER (JUDICIAL) The appellants (Respondent in CP No.36/ND/2015) preferred this appeal against the judgement dated 20.09.2018 passed by the National Company Law Tribunal, Allahabad Bench, Allahabad. The Respondent Company (petitioner in CP No.36/ND/2015) had filed the petition before erstwhile Company Law Board, New Delhi Bench under Sections 397, 398, 402, 403 and 406 of Companies Act, 1956 and after creation of NCLT the petition has been transferred to NCLT Allahabad. 2. The appellant No.1 company was incorporated under the Companies Act, 1956 on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the company and the amount of ₹ 322220/- is disbursed to her as salary. Thus the act of the appellant No.2 to 4 is of oppression and mismanagement towards the company 5. Appellants denied all the allegations and submitted that Respondent has stopped paying expenses and invoices of the appellant company from September, 2013 onwards though contractually agreed as a result the company was unable to pay expenses and taxes and suffered huge losses. In this situation clear notice of 21 days for EGM has been sent to Respondent company through courier service. Thereafter on 22.9.2013 a resolution was passed for increasing the share capital. For the same prescribed procedure as per Companies Ac, 1956 has been followed. Respondent company has also subscribed the increase capital and has paid 30000 USD amounting to ₹ 1626900/-. Thus 162690 shares were allotted to Respondent company, 7310 shares to appellant No.2 and 90000 shares each to appellant No.3 and 4. As per the Articles of Association of the Company the directors are empowered to appoint any person for company and the consent of Respondent is not required. However, Smt Shashi Gupta wife of appellant No.2 was ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k, copy of which filed by the Respondent for the financial year 2013-14 held that on 30.4.2013, 3.6.2013, 2.7.2013, 3.7.2013, 2.8.2013, 4.9.2013, 6.9.2013 and 30.9.2013 the amount was credited by the Respondent company. It shows that the Respondent company has frequently sent funds to the appellant company. 11. The appellants have not filed any documents to show that this finding is incorrect or erroneous conclusion has been drawn by the NCLT. Thus the plea of the appellants that the Respondent company stopped paying expenses/invoices of the appellant company from September, 2013 onwards, therefore, the appellant company has to increase share capital from ₹ 5 lakh to ₹ 40 lakh, is not correct. 12. As per the appellant they have sent the clear 21 days notice of EGM dated 27.9.2013 by courier. In regard to proof of service they have filed the receipt of courier which is illegible. The appellants have not filed any acknowledgement of notice by Respondent Company. Surprisingly the appellants have not sent the notice of EGM dated 27.9.2013 through email to the Respondent. However, during the period the companies have exchanged letters through email. 13. We hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the view that NCLT has rightly held that the share capital of appellant company was increased without establishing the need for capital and without following due procedure and obtaining consent of major shareholders i.e. Respondent company and even without infusing of funds/paying subscription on behalf of the appellant No.2 to 4. Dilution of shareholding of Respondent from 51% to 47% and the increase of authorised capital from ₹ 5 lakh to ₹ 40 lakh allegedly on 27.9.2013 is illegal and liable to be declared void. 22. Learned counsel for the appellants submit that Smt Shashi Gupta was appointed for managing the affairs of the company. For her appointment no permission was required as the Board is competent to appoint the employee. From her salary TDS was deducted and there is nothing on record for giving a finding of siphoning of funds by the appellant. In this regard the findings of the NCLT is erroneous, therefore, liable to be set aside. 23. On the other hand Learned counsel for the Respondent submit that Smt Shashi Gupta is the wife of appellant No.2, Rajender Kumar Gupta. Her name is not shown in the list of employees. It is deliberate act of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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