2009 (9) TMI 1057 - Board - Companies Law

Summary

Issues involved: Company petition for interim reliefs including injunction, oppression and mismanagement allegations, jurisdiction of the Company Law Board.

Interim Relief - Injunction:
- Petitioners sought injunction to restrain eviction of company from leased property.
- Lease deed dated February 11, 1974, for 36 years with provision for building construction and cinema theatre business.
- Subsequent lease deed dated December 28, 1977, extended tenure till 2018.
- Owners acting in dual capacity, entered developmental agreement with third party.
- Petitioners feared business disruption due to lease expiry.
- Jurisdiction under Sections 397/398 to address oppression and mismanagement.
- Court's power to pass interim orders u/s 403 of Companies Act.
- Respondents argued against injunction, citing registered lease deed terms.
- Bench examined lease agreements, ownership rights, and shareholder interests.
- Decision: Bench lacks power to enforce unregistered lease agreement.
- Owners' prerogative to decide on lease extension, not within Bench's scope.
- Petitioners not entitled to relief, case adjourned for further adjudication.

Interim Relief - Oppression and Mismanagement:
- Allegations of oppression and mismanagement raised by petitioners.
- Jurisdiction of Company Law Board to address such issues.
- Reference to Madras High Court judgment on court's powers u/s 403.
- Court's authority to regulate company affairs in case of oppression.
- Prima facie case required for interim relief under Section 403.
- Bench's limitations in dealing with disputed documents.
- Summary nature of proceedings under Sections 397/398.
- Equitable relief granted by Bench, not involving disputed agreements.
- Petitioners' reliance on previous judgment deemed inapplicable.
- Direction for respondents to file counters within three weeks.