TMI Blog2007 (6) TMI 561X X X X Extracts X X X X X X X X Extracts X X X X ..... rectors since the year 2000-2001. 2. The undisputed facts of the case are: The respondent company, namely M/s Teesta Developers Pvt. Ltd. was incorporated on 13.09.1994. The Regd. Office of the company is situated at 4, Pamposh Enclave, New Delhi-110048. The authorised capital of the company was ₹ 50,00,000/- comprising of 5,00,000 equity shares of a sum of ₹ 10/- each. The paid up and subscribed share capital of Respondent No. 1 company is ₹ 40,00,000/- divided into 4,00,000 equity shares of ₹ 10/- each . The main object of the company is to carry on trade or business of town planners, property developers, building contracts, builders, civil engineers, concrete specialists; to construct, execute, alter, pull down, decorate, maintain, furnish, equip improve, work, develop, administer, let, lease, manage or control and deal in land, real estate, etc. The petitioner holds 1,40,000 shares constituting 35% of the share capital. While respondent No. 2 to 5 hold the balance 2,60,000 shares constituting 65% of the paid up capital. Admittedly, the company has two properties namely No. R-124, Greater Kailash-1, New Delhi admeasuring 300 Sq. yds. and on the said pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co., the K Co. would be the one using the said property as tenant would pay nominal rent to the company. K Co., accordingly constructed the building thereon on the said plot of land by spending an amount of ₹ 1,18,73,067/- After the construction was completed a lease-agreement for a period of 5 years w.e.f. 01.02.1995 was entered into at a nominal rent of ₹ 32,000/- p.m. It was pointed out that at the relevant time the market rate of rent was approximately ₹ 1.5 lacs per month. However, the said property was given on a monthly rent of ₹ 32,000/- to K Co. Subsequently the partners of K Co. decided to close the business of K Co. Accordingly, the said K Co. did not require the said property from August 2000 and it was decided to vacate the same. Meanwhile disputes arose between the petitioner on one hand and the respondent No. 2 to 5 on the other hand and in order to prevent the respondents from causing any further damage to the interest of the petitioner in the said partnership firm the petitioner filed the Civil Suit No. 164/2001 in the Hon'ble High Court of Delhi at New Delhi. In the said suit the Hon'ble High Court was pleased to appoint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th to the company (in fact was paying 1.5 lacs per month, which was the market rent at that time). After the entire amount of the said K Co. was written off against the share of each partner, instead of the rent going on higher side the respondent No. 2 to 5 who were the new partners of the said K Co. with the malafide intention and ulterior motive acted jointly and prejudicially against the interest of the petitioner by paying rent at a monthly rent of ₹ 12,500/-per month only, when admittedly at the relevant time the rent of the said building / property was more than ₹ 3,00,000/- per month. The said act itself is an act of oppression and mismanagement carried out by the respondent No. 2 to 5 in collusion with each other against the petitioner. As the respondent No. 2 to 5 were the partners of K Co., they reaped the benefit at the cost of the petitioner by letting out the property at a nominal rent of ₹ 12,500/- only. 6. It was argued that the petitioner on coming to know of the said illegal and unlawful acts of the respondent No. 2 to 5 protested and on the said protest being made the respondent No. 2 to 5 instead of paying the market rent increased the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orized Mr. Ashwani Khurana the petitioner to execute all the necessary documents for the purchase of the said property. The Agreement to Sell was executed on 09.04.1998 and possession of the said property was taken over by the Company simultaneously. The sale deed for the said property has not been registered and the Respondents are blaming the Petitioner for not doing so. As per the documents filed by the Respondents alongwith the Reply, it seems that both the Sellers are permanent resident of Singapore and had in the year 2000 executed a Power of Attorney in favour of Ms. Poonam Bahl, sister of one of the Sellers. All the acts for the registration of the said property are to be done by Ms. Poonam Bahl. It was pointed out that since the company is under direct control of the Respondents since the year 2001 it is they who have to approach the said Ms. Poonam Bahl for the registration of the said property. By not doing so it is the respondents who are to be blamed and not the petitioner. The respondents themselves are guilty of not coming forward and / or not approaching Ms. Poonam Bahl for the registration of the said property. It was pointed out that the said property was let out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eesta House was built with the funds of the firm and accordingly a lower rent was agreed to be paid, which has already been settled in writing between the firm and the other promoters of Teesta Developers. The grievance of the Claimant, if any as shareholder of Teesta Developers, cannot be entertained in this case as the said matter is not subject matter of reference. It was pointed out that it was then the Petitioner was left with no other efficacious remedy but to file the present petition. The Petitioner has filed no objection to the C.A.'s contentions that Teesta Developers cannot be added to the K Co. issue as it is not a party to the dispute. It was pointed out that the petitioner has accepted this contention of the CA. It was contended that even if the interim report submitted by the Charted Accountant is not accepted by the Learned Arbitrator even then the Respondents can not disown and / or back out from their own stand / reply. 11. Shri Dinesh Agnani, Counsel for the petitioner argued that the Respondents are trying to prejudice the mind of this Hon'ble Board by alleging that the respondents have filed a claim of ₹ 100 Crores against the petitioner whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der N. Grover, Counsel for the respondents argued that this petition is not maintainable as there is no oppression and mismanagement as defined under Section 397 and 398 of the Act, the petitioner is misusing this Hon'ble forum and misquoting the law to his own interest and due to previous dispute of partnership with the respondents which is already sub-judice. The present petition is barred under the law as even from the bare reading of the petition it is no where stated that how the petitioner is being oppressed and where is the mismanagement in the company, this petition is liable to be dismissed on this ground alone. Further, it was pointed out that the petitioner has not come with clean hands as he has suppressed material facts from this Hon'ble Board not only relating to the affairs and disputes between the petitioner and the respondent but also to the acts of the petitioner relating to this company. In fact the petitioner has misappropriated a huge amount not only from the joint partnership firm M/S K CO. but his acts acting as a Director in this company also does not conform to his duties as Director and custodian of the assets of the company. In fact it is the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd associate of the petitioner who has been receiving the misappropriated amount under conspiracy from the petitioner when the petitioner was the CEO of the K Co. It was argued that this frivolous petition was filed only to save himself from the charges of mismanagement. 15. Further, the counsel for the respondents pointed out that in fact both the firm and the company and the entire operations were controlled by the petitioner and not by the respondents. The respondents were not aware of the ill designs of the petitioner who at that time refused to put more capital into this company and suggested this idea of putting the funds of K Co. into the construction of building at this plot. At that point of time it was settled that the amount spent by the K Co. will be returned to the K Co in the instalments but the petitioner suggested that instead of returning the amount K Co. will be charged nominal rent for using this premises. It was argued that it is highly objectionable that the petitioner had used his own calculations for computing the prevailing rent at that time and the actual rent paid by the K Co. As at that point of time K Co. spent amount in crores in this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Hon'ble High Court of Delhi in which direction has been made by the Hon'ble High court to complete the investigation by next 6 months which was further extended. The counsel pointed out that in fact the petitioner is contradicting his own earlier statement that the said property had nothing to do with the business of K Co. and it was used only as back office operations while the firm was running. And after the decision to close the business of K Co. the office of K Co. was relocated as per the decisions of the partners. Hence there is no question of retention of property by the K CO. In fact the K Co. was using the space of this property as per their requirement and in fact the amount of construction was spent by the K CO. and apart from that the K Co. was paying regular rent to the company Teesta Developers Pvt. Ltd. 17. Further, it was contended by the counsel that there is no new K Co. as alleged by the petitioner. The firm K Co. is in existence till date as it was formed the only change is that the petitioner had retired from this concern. That it is totally wrong and denied that said new K Co , started using this premises for its own business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er has not come with clean hands, it is settled law that the petitioner who seeks equity must come with clean hands, and that the conduct of the petitioner in other proceedings also is to be considered while deciding the maintainability of a petition under Sections 397 and 398 of the Act. In the present case the respondents' contention that the petitioner did not come with clean hands in the affairs of the R-1 company as demonstrated by his dealing with purchase of property at Bangalore as well as the allegations against the petitioner of siphoning off fund worth ₹ 100 crores, pertaining to the affairs of the partnership concern, which is pending for adjudication before the Sole Arbitrator being conduct in the other proceedings of the petitioner cannot be ignored. On the grounds of preliminary objections being tenable, the petition deserves to be dismissed at the threshold itself. However, considering the case on merits, I find that the petitioner's allegation that the company's asset had been let out at a lower market value causing damage to the interest of the petitioner, the company, and the other shareholders is not borne out from the facts of the case. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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