2019 (6) TMI 1500 - Tri - Companies Law

Oppression and Mismanagement - prayer of the Petitioner is to change the date of valuation of Petitioner s shares from 31-3-1998 to the current date - HELD THAT - This Bench is of the opinion that the valuation report of M/s Natu and Phatak dated 27.06.2016 is required to be adopted for the purpose of calculation of valuation of the shares of the Company held by the Petitioner. The said Valuer has computed the share valuation as on 17.09.2008. The Valuer has given a reason that the Hon ble Bombay High Court vide Order dated 15.10.2015 has so opined, hence in accordance to the said Order completed the valuation. The Valuer has pointed out that opportunities were granted to both the sides for their respective representations but only attended by one director Mr. Anshul Kumar, and not attended by Mr. Vinod Kumar. Mr. Vinod Kumar has only informed that one SLP is filed before the Supreme Court challenging the said appointment of the Valuer. The Applicant has not accepted the verdict of the Hon ble Supreme Court dated 17.09.2008 which in absolute term have held that events were to be taken into account till now i.e. up to the date of Order 17.09.2008 (relevant portion already reproduced supra). No ambiguity was left, hence the Hon ble High Court has also given the direction on the same lines. It is not possible to keep on changing a cut-off date relevant for the purpose of fixation of valuation on a particular date. The Applicant has coined a terminology changed circumstances , without giving any specific date. Circumstances keep on changing in business-world every day. Therefore, a cut-off date has to be determined. The valuer has rightly adopted 17.09.2008 as the cut-off date for the purpose of valuation by following the instructions of the Hon ble Bombay High Court decisions dated 27.07.2015 / 15.10.2015. No interference is possible by this Bench because the superior Hon ble Courts have given their respective verdict on number of occasions in unambiguous terms. If a dispute is to be resolved and litigation is to be settled, then both the sides are required to take a pragmatic approach. This case has a chequered history of about two decades, therefore, there should be an end to a litigation. To settle a dispute a thumb rule is that both the sides have to sacrifice some of their rights. Simultaneously both the sides have to forget about the past especially the events triggering the dispute or may be hurting each other's repute. Particularly, in such cases where the rival parties are brothers or closely related to each other. Keeping this benevolent approach in mind this Bench is of the view that on one hand the Petitioner be directed to surrender the shareholdings in favour of the Respondents and on the other hand the price duly determined by the Valuer be paid to the Petitioner. Additionally, the Petitioner should also be paid salary and perquisites for a reasonable period, already been discussed on several occasions in the past. The Statute is absolutely clear that the Power of Review of its own Order is not enshrined upon NCLT. At the most, power of rectification is enshrined under Rule 154 of National Company Law Tribunal Rules, 2016, i.e. Rectification of Order. Rectification is defined i.e. any clerical or arithmetical mistake, any accidental slip, omission can be rectified even on its own motion by the Tribunal or on an Application by any of the Parties. A correction of an apparent mistake is not to that extent which may substitute a judicial view already taken in an earlier Order. If a judicial view expressed in an Order is not acceptable to any of the Parties, the same is always subject to Appeal. But in the guise of review or clarification ; power of Appeal must not be demanded by an Applicant. If a litigant is not satisfied with the judicial view adopted by NCLT Bench, is at liberty to challenge the same before NCLAT (National Company Law Appellate Tribunal). Sometimes rectification is carried out if in the opinion of the Bench is that what was intended to have been done was not done in the order, as it ought to have been done, hence it would mean that an apparent error committed which is rectifiable at a first glance. All the decisions as referred by the Applicant are well discussed and well-reasoned orders therefore completely out of the purview of rectification. Application allowed in part.

Summary

Issues Involved:
1. Valuation of shares.
2. Payment of remuneration and perquisites.
3. Validity of Board Resolutions and EOGM.
4. Management control and interference in company affairs.
5. Inspection of statutory records.
6. Payment of arrears and interest.
7. Miscellaneous reliefs and clarifications.

Issue-wise Analysis:

1. Valuation of Shares:
The valuation of the shares was a primary issue. The Tribunal confirmed the valuation of shares determined by M/s. Natu & Phatak at ?8,794 per share as on 17.09.2008. This valuation was based on the directions of the Hon'ble Supreme Court and subsequent High Court orders. The Tribunal rejected the petitioner's request to change the valuation date from 31.03.1998 to a current date, emphasizing that the valuation date was fixed by the Supreme Court's order dated 17.09.2008.

2. Payment of Remuneration and Perquisites:
The Tribunal addressed the issue of remuneration and perquisites payable to the petitioner. The Tribunal directed that the petitioner be paid an annual salary of ?2,40,000 from 01.10.1999 to 17.09.2008, as well as perquisites for electricity, house rent, and medical expenses, subject to proof of actual payment. The Tribunal also awarded interest on the arrears at 12% per annum up to 26.03.2014 and 8% per annum thereafter until the date of the first installment payment.

3. Validity of Board Resolutions and EOGM:
The Tribunal rejected the petitioner's request to declare certain Board Resolutions and EOGM minutes as null and void. The Tribunal noted that these resolutions and meetings were beyond the scope of the original petition and that the issue of oppression and mismanagement had already been adjudicated upon in the final order dated 20.08.1999, which was not challenged by either party.

4. Management Control and Interference in Company Affairs:
The Tribunal dismissed the petitioner's request to hand over management control of the respondent company to him. The Tribunal reiterated that the petitioner had chosen the option to exit the company by selling his shares, as recorded in the CLB's order dated 20.08.1999. The Tribunal emphasized that the petitioner could not now seek to interfere in the management of the company.

5. Inspection of Statutory Records:
The Tribunal rejected the petitioner's request for inspection of statutory records. The Tribunal noted that the petitioner, having chosen to exit the company, could not interfere in the company's affairs or seek inspection of its records. The Tribunal also referred to the High Court's order dated 27.07.2015, which held that the petitioner could not challenge the Board resolutions or seek to take over the management under the guise of fresh consideration.

6. Payment of Arrears and Interest:
The Tribunal directed the respondent to pay the petitioner arrears of salary and perquisites, along with interest. The Tribunal specified that the payment should be made in six equal monthly installments, starting from 01.08.2019. The Tribunal also directed the petitioner to keep the share certificates in a bank locker to be operated jointly with the respondent until the final installment payment.

7. Miscellaneous Reliefs and Clarifications:
The Tribunal dismissed the petitioner's miscellaneous application (CA 136/2014) seeking clarifications and additional reliefs. The Tribunal noted that the orders referred to in the application had already been adjudicated upon and that the Tribunal did not have the power to review or rectify its own orders. The Tribunal emphasized that any grievances regarding the orders should be addressed through appropriate appellate mechanisms.

Conclusion:
The Tribunal's judgment provided a comprehensive resolution to the long-standing dispute between the parties, addressing the valuation of shares, payment of remuneration and perquisites, and other related issues. The Tribunal's directions aimed to bring finality to the litigation and ensure compliance with the orders of the higher courts.