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Issues involved: Company application for amendment of petition by adding respondents, allegations of oppression and mismanagement, validity of extraordinary general meeting, involvement of new directors in criminal activities, objections to proposed amendments, relevance of subsequent events in deciding the petition, consideration of grievances as shareholders in a company petition.
Amendment of Petition: The company application sought to amend the petition by adding respondents and additional prayers, with the court proposing to consider the amendments on merits despite their length. Background of Petition: Company Petition No. 573 of 1984 was filed under sections 397 and 398 by shareholders representing 35% of shareholding in the fifth respondent company, alleging oppression and mismanagement by certain respondents who held significant equity shares. Allegations of Misconduct: The petitioners alleged that certain respondents committed acts of oppression and mismanagement post the filing of the petition, including convening an extraordinary general meeting with questionable validity and appointing new directors amidst criminal charges. Objections to Amendments: Respondents objected to certain amendments, arguing that subsequent events post the filing of the original petition should not be considered in deciding the case under sections 397 and 398 of the Companies Act. Legal Precedents: The court discussed legal precedents, emphasizing that amendments incorporating subsequent events are permissible if necessary for the proper determination of issues between parties, as supported by various judgments under the Companies Act and the Code of Civil Procedure. Grievances as Shareholders: The court addressed the contention that grievances as directors cannot form the subject of a petition under sections 397 and 398, highlighting a case where lack of probity as a shareholder did not entitle relief, but in the present case, the amendments related to acts affecting the petitioners as both directors and shareholders. Judgment: The judge's summons were made absolute for amending the petition, allowing respondents to file additional affidavits, setting timelines for responses, and scheduling the petition for a hearing after six weeks.
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