2020 (2) TMI 1327 - Tri - Companies Law

Service of Notice - Cancellation of Illegal appointment of directors in the Annual General Meeting - HELD THAT - There appears factual controversy in between the parties whether notices of AGM dated 24.09.2019 and EoGM dated 04.01.2020 had really been given to the petitioner. To record finding on this aspect we have to hear main petition allowing the parties to lead evidence to suppon their contention. At this interim stage we cannot record our findings on this factual controversy. We found that there is a prima facie evidence on record indicating that the notices of both the meetings were given to the petitioner. Hence we are not inclined to grant interim relief as claimed by the petitioner. We are also of the considered opinion that if we are to allow interim relief as claimed by the petitioner then it will be nothing but allowing his prayers in the main petition itself. Such procedure is not contemplated while considering interim application. The respondent nos. I to 6 are directed to file affidavit-in-reply to main petition within three weeks by giving copies thereof to the petitioner and the petitioner to file rejoinder thereto within two weeks thereafter. Main Petition to appear for further consideration on 08.04.2020. Application filed by the petitioner for interim relief stands rejected.

Summary

Issues:
Alleged illegal appointment and removal of directors, lack of notice for meetings, oppression of rights, interim relief sought.

Analysis:
The petitioner, a shareholder and ex-director of a company, filed a petition under sections 241 and 242 of the Companies Act, 2013, alleging collusion among respondents resulting in the illegal appointment and removal of directors without proper notice. The petitioner claimed that resolutions passed in meetings were void and prejudicial to his interests, seeking interim relief to cancel the appointments and reinstate himself as a director. The Tribunal reviewed the petition containing 36 prayers and heard arguments from counsels representing both parties.

During the proceedings, the respondents filed affidavit-in-reply, and the matter was scheduled for further consideration. The petitioner appealed an adjournment order, leading to directions to dispose of the petition promptly. Both parties presented their case, with the petitioner arguing lack of notice for meetings rendered resolutions invalid, citing legal precedents. Respondents countered, asserting proper notice was served, and majority shareholders had the right to make directorial decisions.

The Tribunal acknowledged the factual dispute regarding notice receipt by the petitioner and declined to grant interim relief, emphasizing the need for a full hearing to assess evidence and resolve the controversy. Consequently, the petition for interim relief was rejected, with directions for respondents to file replies to the main petition and set a date for further consideration. The Tribunal highlighted the importance of due process and evidentiary hearings in determining the validity of appointments and addressing the petitioner's grievances.

In conclusion, the Tribunal's order rejected the interim relief application, instructed respondents to file replies, and scheduled the main petition for further review, emphasizing the need for a comprehensive examination of evidence and legal arguments to resolve the dispute effectively.