2010 (7) TMI 825 - Board - Companies Law

Summary

Issues:
Petition under section 167 of the Companies Act, 1956 seeking directions for inspection and supply of annual accounts, postponement of annual general meeting, and awarding exemplary costs.

Analysis:

1. Inspection and Supply of Annual Accounts:
The petitioner sought inspection and copies of detailed annual accounts of all subsidiaries of the respondent-company and particulars of employees. The petitioner claimed to have requested for inspection and copies of documents as per statutory provisions but was allegedly refused by the respondent-company. The respondent, however, contended that the notice along with the annual report and accounts were sent to the petitioner complying with the Companies Act, 1956. The respondent argued that the petitioner's requisitions were made to cause inconvenience and cited previous complaints filed by the petitioner against other companies. The Bench observed that while the petitioner claimed to have been refused inspection, there was no evidence presented to support this claim. Consequently, the petition for inspection was deemed premature, and the reliefs sought were not granted.

2. Postponement of Annual General Meeting:
The petitioner requested the postponement of the annual general meeting scheduled for July 23, 2010, alleging lack of inspection of required documents. The respondent maintained that they had complied with legal provisions and supplied the necessary documents along with the notice. The Bench highlighted that the provisions of section 167 of the Companies Act, 1956 could only be invoked if the company had defaulted in holding the annual general meeting within the stipulated period under section 166. Since there was no evidence of default by the respondent-company in holding the annual general meeting, the jurisdiction of the Company Law Board under section 167 could not be invoked. Therefore, the petition was dismissed as misconceived.

3. Jurisdiction of the Company Law Board:
The respondent's counsel argued that the Company Law Board lacked jurisdiction under section 167 where no default under section 166 had occurred, citing a previous decision. The Bench emphasized that the petitioner failed to demonstrate any default by the company in holding the annual general meeting within the prescribed time. Without evidence of such default, the jurisdiction of the Company Law Board could not be invoked under section 167. The petition was ultimately dismissed, and no costs were awarded.

In conclusion, the judgment dismissed the petition as misconceived due to the lack of evidence supporting the petitioner's claims of refusal of inspection and the absence of default by the respondent-company in holding the annual general meeting within the required timeframe. The decision underscored the importance of providing substantiated evidence when seeking legal remedies under the Companies Act, 1956.