2016 (8) TMI 1275 - Tri - Companies Law

Preventing the director from entering the office and non-payment of salary - Restriction through Access Swipe Card - Held that - On perusal of the records it is found that there were specific directions Of the Company Law Board for maintaining the status quo as to the shareholding and Extra Ordinary General Meeting in terms of Section 100(1) of the Companies Act 2013 and the directorship. In continuation of the ad interim order dated 3rd May 2016 of the CLB following clarifications are issued. (1) As Access Swipe Card have been issued for other personnel of the Company similar cards may be issued for enabling the petitioner no. 1 and respondent no. 9 to enter the office for discharging their duties. (2) Similarly, official e-mail i.ds. of the petitioner no. 1 and respondent no. 9 may be activated for the official use of the petitioner no. 1 and respondent no. 9. (3) It was stated that no salary has been paid to the petitioner no. 1 as well as to respondent no. 9. If the other directors of the Company are getting salary as Directors of the Company, similar payments may be made to petitioner no. 1 and respondent no. 9 as per the laid down terms Of the Company.

Summary

Issues:
Violation of Company Law Board order regarding access to office and payment of salaries and perks.

Analysis:
The judgment concerns a Company Application filed by the petitioner seeking to uphold an ad interim order passed by the Company Law Board. The main contentions of the petitioner include the respondents' actions of not providing access swipe cards to enter the company's head office, thus hindering the petitioner and another respondent from fulfilling their duties as Managing Director and Director. This refusal is in direct violation of the Company Law Board's order. Additionally, the respondents are accused of withholding salaries and other benefits from the petitioner and the other respondent while ensuring timely payments to other directors. The records reveal specific directions from the Company Law Board regarding maintaining the status quo on shareholding and Extra Ordinary General Meeting as per the Companies Act 2013. The petitioner and the other respondent express their inability to carry out their roles due to being barred from the company's premises despite the CLB's orders.

The Tribunal, in continuation of the ad interim order, issues clarifications. Firstly, it directs the issuance of access swipe cards to the petitioner and the other respondent to enable them to enter the office for discharging their duties. Secondly, it mandates the activation of official email IDs for their official use. Lastly, concerning salaries, if other directors are receiving payments as per the company's terms, similar payments should be made to the petitioner and the other respondent. The judgment emphasizes adherence to the Company Law Board's directives and ensures that the petitioner and the other respondent can fulfill their obligations as designated company officials.