TMI Blog2021 (2) TMI 656X X X X Extracts X X X X X X X X Extracts X X X X ..... ct-matter of the main company petition. Eligibility to maintain an application/petition - section 241 of Companies Act, 2013 - HELD THAT:- The Tribunal is empowered to waive all or any requirements specified under section 242(1), on an application made to the Tribunal in the matter. Accordingly, the applicant/petitioner has filed the instant application under section 244(1) read with sections 241 and 242 of the Companies Act, 2013, read with rules 11 and 34 of the National Company Law Tribunal Rules, 2016, seeking to waive requisite conditions to file the main company petition. Therefore, the instant application is maintainable. The main company petition is filed by the petitioner by questioning various acts of oppression and mismanagement, which are found to be prima facie meritorious so as to consider those allegations at the time of final hearing of the case, after waiving the requisite condition as sought for. A meritorious/disputed litigation cannot be thrown at threshold without looking into merits of the case by the Tribunal/court by depriving aggrieved party remediless. The contention of the respondent that civil court has already decided the issues and thus the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er shareholding has been reduced to mere 9 per cent. by virtue of rights issue, which is impugned in the main company petition. Pawan Kumar Jain (hereinafter referred to as respondent No. 2) is the managing director of the company. Prior to April, 2016, he held 5,500 (55 per cent.) shares in the company. Therefore, prior to April 2016, the applicant/petitioner as well as respondent No. 2 are only two shareholders. Presently, respondent No. 2 holds 40,500 equity shares, i. e., 81 per cent. of the total equity share capital of the company. The applicant was inducted as a director on the board of directors on July 22, 2008. The applicant continued to remain in charge of the development of the business and co-ordination with customs. The business was spread across the country and the petitioner was often required to travel on business. The business of the company steadily improved to such an extent that during the years 2012-13, 2013-14 and 2014-15 and thus its turnover had been ₹ 8,67,74,578, ₹ 11,23,94,469 and ₹ 10,25,69,293 respectively. (3) In a fit of anger, the applicant has written a letter of resignation from the board of directors. On April 9, 2016 the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s against her, the applicant was, at that time, not in any frame of mind to invest lakhs of rupees in respondent No. 1-company. Hence, the applicant did not subscribe for the further shares being issued by respondent No. 1-company. On the other hand, respondent No. 2 subscribed to and allotted to himself and to his wife, respondent No. 3, the further shares, thereby proportionately increasing their combined shareholding in respondent No. 1-company from 55 per cent. to 91 per cent. and reducing the proportionate shareholding of the applicant/petitioner in her company from 45 per cent. to 9 per cent. The illegal activities of the respondent came to light only in January, 2018 while adducing evidence. (5) Aggrieved by various acts of oppression and mismanagement on the part of the respondents, the applicant has filed the main company petition, under sections 241 and 242 of the Companies Act, 2013. Since the applicant is holding less than 10 per cent. shares to maintain the company petition as per law, the instant application is filed by seeking for a waiver of the statutory requirements to institute proceedings of oppression and mis management under section 244(1) of the Companies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent No. 1-company on April 13, 2016 and the rights issue notified to the petitioner vide letter dated April 25, 2016. (4) It is alleged that the instant case is nothing but forum shopping and cannot be sustained on any court. There are no exceptional circumstances made out to justify granting waiver and the request made to grant waiver does not demonstrate any bona fides or justification. Therefore, they sought to dismiss the instant application. 4. Heard Shri Dhananjay Joshi, learned counsel for the applicant/petitioner and Shri Dhyan Chinnappa, learned senior counsel for the respondents, through video conference. We have carefully perused the pleadings of the parties along with extant provisions of the Companies Act, 2013 and the Rules made thereunder, and the law as relied upon by the parties. 5. Shri Dhananjay Joshi, learned counsel for the applicant, while reiterating various averments made in the company petition, as well as in the instant application, as briefly stated supra, and also filed a statement written arguments dated June 1, 2020 has further submitted the issues decided by the civil court is nothing to do with the issues raised in instant case. And su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) It is contended that no liberty has been reserved by the civil court for the petitioner to raise any such issue before this Tribunal. All that the civil court has stated is that a person is entitled to raise an issue in terms of Chapter 16 of the Companies Act, 2013. However, once the court has already answered the question with respect to allotment, answer it again don't arise as it is barred by the principles of constructive res judicata. In addition, the civil court is not a Superior Court to grant liberty to any party to go to any other forum. This is the power vested only in the High Court and the apex court. In any event, the civil court has only noticed the existence of a right to challenge a decision and has granted any liberty to ignore the order of the civil court and approach this Tribunal. (3) It is an admitted position that the applicant/petitioner was offered shares in proportion to her shareholding, and if she had subscribed to the shares, her shareholding would have continued at 45 per cent. This is admitted by the applicant/petitioner in her cross examination in the civil suit as well. She failed and rather refused to subscribe to it. She did not protest a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition, fell under the jurisdiction of this Tribunal, as those issues are admittedly affairs of the company. Therefore, undoubtedly, the Tribunal is empowered to deal with the issue raised in the main company petition, as same is filed under sections 241 and 242 of the Companies Act, 2013 by alleging various acts of oppression and mismanagement. Moreover, the issue raised in the said suit is only relating to acceptance of the resignation. It is nothing to do with the acts of oppression and mismanagement, which is subject-matter of the main company petition. 9. So far as eligibility to maintain an application/petition, under section 241 of Companies Act, 2013, section 244 deals with the eligibility of the persons, who can apply to the Tribunal, under section 241 of the Companies Act, 2013, which reads as under : 244. (1) The following members of a company shall have the right to apply under section namely :- (a) in the case of a company having a share capital, not less than one hundred members of the company or not less than one-tenth of the total number of its members, whichever is less, or any member of members holding not less than one-tenth of the issued share capita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for. A meritorious/disputed litigation cannot be thrown at threshold without looking into merits of the case by the Tribunal/court by depriving aggrieved party remediless. The contention of the respondent that civil court has already decided the issues and thus the present application and main company petition are not maintainable, are baseless on facts and on law, as detailed supra. Moreover, the civil court has decided only in respect of the alleged acceptance of resignation, and civil court do not have any jurisdiction to decide the acts of oppression and mismanagement of the Companies Act, 2013. 11. The above facts and circumstance of the case clearly established that the applicant/petitioner has made out a prima facie case to entertain the main company petition for its final adjudication. Moreover, it is a settled position of law that a meritorious litigation cannot be thrown at threshold without examining the merits of the case. It is not in dispute that the applicant is admittedly, a shareholder of the company by holding 09 per cent. of its total shares. Therefore, the applicant/petitioner is entitled for waiver as prescribed, under section 244(1) of the Companies Act, a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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