2015 (7) TMI 219 - Board - Companies Law

Petition u/s 167 of the Companies Act, 1956 - Irregularity in holding Annual General Meetings - Held that - In my opinion, this petition, on the face of it, is not maintainable as contended by the Ld. Counsel for the Respondents. The prayer as per clause (a) of the Petitioner clearly shows that the Petitioner has sought relief to the effect that the Annual General Meetings of the Respondent No. l Company shown as held for the Financial Years 2003-2004 to 2009-2010 be declared as invalid. Prayer clause (b) of the Petition reveals that the Petitioner has sought cancellation of various Resolutions purported to have been passed in the EOGM held on 20/12/2007, by which appointments of Mr. Shaunak H. Choksi (Respondent No. 2) as Managing Director and Mr. Himanshu Harshad Choksi (Respondent No. 3) as Whole-time Director, were made and their remunerations were fixed. It is, therefore, established that there is no default in holding the AGM as contemplated in Section 167 of the Act, The challenge as to validity of the AGMs, in my considered view, does not fall within the purview of the provisions contained in Section 167 of the Act as held in the cases (i) National Textile Corporation (U.P.) Ltd. 1998 (4) TMI 431 - HIGH COURT OF DELHI and (ii) Gracy Thomas v. Four Square Estates P. Ltd. & Ors 2007 (10) TMI 608 - CALCUTTA HIGH COURT . - Petition dismissed.

Summary

Issues:
1. Petition filed under section 167 of the Companies Act, 1956 seeking various reliefs related to the Annual General Meetings (AGMs) and Resolutions passed.

Analysis:
1. The petitioner sought relief to declare AGMs of the respondent company as invalid for the financial years 2003-04 to 2009-10 due to improper convening by unauthorized persons. Additionally, requested to hold Resolutions passed in an extraordinary general meeting on 20/12/2007 as invalid. The petitioner also demanded the convening of the AGM for the year ended 30/06/2004 within 45 days, appointment of an Administrator, and appointment of an impartial chairman for the AGM.

2. The respondents contended that the petition was not maintainable under Section 167 of the Act, citing precedents. The petitioner argued that the AGMs were invalid as the Board of Directors were not validly appointed, making the AGMs void. The judge noted that the challenge to the AGMs' validity did not fall under the purview of Section 167, as established in previous cases.

3. The judge referenced the provisions of Sections 166, 167, 168, 255, and 256 of the Companies Act, 1956, emphasizing the requirements for holding AGMs and the power of the Central Government to call AGMs in case of default. The judge dismissed the petition as not maintainable, relying on legal precedents that clarified the scope of Section 167 and the Company Law Board's jurisdiction in adjudicating disputes regarding AGM validity.

4. The judge concluded that the petition lacked merit and ordered its dismissal. No costs were awarded, and any interim orders were vacated. The judgment highlighted the importance of adhering to legal provisions and precedents in matters concerning AGMs and resolutions under the Companies Act, 1956.