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TMI Blog2021 (12) TMI 1062X X X X Extracts X X X X X X X X Extracts X X X X ..... mited, was incorporated on 02.01.1995 with CIN No. U45201KL2005PTC008520. The registered office of the 1st Respondent Company is situated at 32/2982 B, Sahrudaya Building, Ponnurunni, Vyttila P.O., Ernakulam- 682 019. The main object of the 1st Respondent Company is to do real estate or property developers whether by development of land or in any other manner including filling of land, laying of roads and construction of buildings. 3. The 2nd Respondent, 3rd Respondent, 2nd Petitioner and one Susha Deny were promoters of the Company. Prior to 2005, Susha Denny had transferred her shares to 2nd Petitioner who later transferred 59000 shares to 1st Petitioner on 21.2.2005. As per the Annual Return as on 30.09.2005 the share holding pattern of the first respondent Company is as under: Name No of shares (Rs. 10 each) Percentage Status in the petition K.J. Paul 25000 26% Respondent 2 Bindu Paul 10000 11% Respondent 3 P.M. Johny 59000 62% Petitioner 1 K.P.Augustine 1000 1% Petitioner 2 The above share holding pattern continued upto 31.03.2008 and constituted the base shareholding. As per the above shareholding pattern, 2nd and 3rd Respondents (who are husband and wif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocess is completed, there shall not be any change in the composition of the Board constituted by this Bench, and shareholding pattern shall remain the same as on 30.09.2005. The fee of the independent Auditor shall be paid by the 1st Respondent Company which shall be fixed as per mutually agreed terms. Accordingly, the interim order, if any stands vacated. No Order as to costs." Being aggrieved by the above impugned order passed in TCP No.67/2016 by the National Company Law Tribunal, Division Bench, Chennai, whereby the Company Petition has been allowed vide order dated 7th December, 2017, the 1st to 3rd Petitioners have filed an appeal by filing Company Appeal (AT) No. 06 of 2018 before the Hon'ble NCLAT, New Delhi, under Section 421 of the Companies Act, 2013. The appellate authority ordered as under: "On the question of relief, reliefs depend on a particular fact of the case. Such an order should not amount to rewarding the wrongdoers and penalise the oppressed party. NCLT, seeing the totality of circumstances, interest of the company and the intention of the parties, has rightly given first opportunity for purchase of shares of appellants to 2nd and 3rd respondent failing w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the panel of names suggested by the respondents, as two independent auditors to individually undertake true and fair value of shares of the Respondent Company as on 07.12.2017. The Auditors are directed to submit the valuation report within a period of 45 days from the date of this Order to the Respondent Company. Thereafter, the entire process delineated in the NCLT, Chennai Order dated 07.12.2017 should be complied within 12 weeks by the parties. (ii) The fee for valuation of respondent company will be borne by the respondent company itself. (iii) Shri. K. J. Paul, Respondent No.1 in this I.A is directed to file the requisite statutory forms immediately, including those relating to the appointment of the 1st applicant as the Managing Director, change in the designation of the Respondent No.1 from 'Managing Director' to 'Director' and removal of the Respondent No.2 and Respondent No.3 from the directorship of Respondent No.4 Company. He is also directed to participate in the Board Meetings in future and extend his co-operation for the smooth conduct of business of the respondent company." 5. Pursuant to the above dated 19.02.2020, the Auditors-CA Suresh T. N & CA Dr. Sant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the principal reasons for the difference in valuation adopted by the two Chartered Accountants are as follows: - (i) Non acceptance of confirmation received from prospective sellers of land to the 1st Respondent Company where the sale agreement fell through and out of a total advance of Rs. 4,96,25,000/- sellers had issued confirmation for receipt for Rs. 2,46,90,967/-. Sri. T.N. Suresh, Chartered Accountant has accepted this confirmation whereas Sri. Santha Kumar has not accepted this confirmation. (ii) A difference in valuation of the land and properties of the 1st Respondent Company wherein Sri. T.N. Suresh having fixed value of Rs. 20,81,67,000/- and Sri. Santha Kumar having fixed at value of Rs. 18,10,50,300/-. The difference being Rs. 2,71,16,700/-. (iii) A difference in Sundry Receivables and work advances to the tune of Rs. 8,65;290/- (iv) A difference of Rs. 22,20,219/- with respect to TDS and advance tax. 9. The learned Senior counsel for the Applicants/ Respondents 2 to 4 submitted that the valuation has been done pursuant to Orders of Hon'ble NCLT, Chennai as well as Hon'ble NCLAT which contemplate exit of either the Respondents/Petitioners Group f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n attempt to subvert the due process of law and contains false and distorted statements. It deprives the Respondents right to exercise the first option to buy out the shares, conferred on them by the NCLT and upheld by the NCLAT in appeal. Such option was conferred on finding that the Respondents who are the majority shareholders were subjected to brutal oppression by the Applicants (minority shareholders) by resorting to acts of falsification of accounts and fabrication of evidence. It is also stated that by the very same order the 1st Applicant was removed from the post of Managing Director and 2ndRespondent was appointed as the Managing Director in his place. 14. The learned counsel for the Respondent submitted that there is a marked difference between the values arrived at by the two auditors. The learned counsel further submitted that the valuation made by Dr.Santha Kumar is more realistic and acceptable than the valuation made by T.N. Suresh since there is evidence that the valuation report made by the said T.N. Suresh is not independent, but was influenced by the Applicants in the process of the valuation of shares undertaken by him. One of the major differences in the valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... complete lack of probity amongst the parties. Dragging this petition further will not solve the problem; so, a permanent solution has to be found which would enable the company, to function smoothly. As the main Company Petition is already decided by NCLT, Chennai Bench and upheld by NCLAT, the solution can only be found in one of the groups purchasing the shares of the other. As this Tribunal appointed two Chartered Accountants for both the sides, 2 valuation reports were filed and the value assessed by them has difference in the amounts for the share. 18. During the course of arguments, it is submitted by the applicants herein that they are willing to accept the higher valuation submitted by Sri T. N. Suresh Chartered Accountant at Rs. 1941/- per share, if the respondent/ Petitioners in the main Company Petition are not willing to buy out the shares at the said share price. In this respect, as per the decision of NCLT, Chennai bench vide order dated 7th December,2017, first opportunity is to be given to the Respondent/ petitioner to purchase the shares of Applicant/ Respondents. However, the valuation done by the CA Shri T. N Suresh is not acceptable to his parties, and his requ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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