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2023 (12) TMI 1322 - Tri - Companies LawSeeking a direction for investigation into the affairs of the Company and those of the related parties - Section 213 of the Companies Act 2013 - HELD THAT - There have been specific allegations about the irregularities stated in this application u/s 213 and the RP s reply does not take care of any of these allegations which is with reference to the specific details and documents. There is no denial in the RP s reply with respect to 164 Buyers listed in Page 25 onwards of CP comprising of sale of 2, 43, 037 sq. ft. in total by the R-1 Company whereas they were entitled to ownership of only 82, 216.30 sq. ft. as per the JDA. This excessive sale three times of their entitlement by the R-1 Company has neither been explained nor has any denial been filed. Furthermore there has been allegation regarding the fake Lease Agreement with R-16 and R-17 to lure the Buyers with a false promise of assured rental return which was non-existent for which the Petitioners have also filed the specific documents for such Lease Agreements with R-16 and R-17. However in the reply filed by RP on behalf of the R-1 Company no explanation has been furnished about the same. The investigation under Section 213 of the Companies Act 2013 is possible in respect of the Company which is undergoing the process of liquidation. Therefore by exercising powers under Section 213 of the Companies Act 2013 the instant Petition deserves to be allowed. Petition allowed.
Issues Involved:
1. Allegations of fraudulent sale of property by the company. 2. Violation of court orders and collusion among respondents. 3. Request for investigation into the affairs of the company u/s 213 of the Companies Act, 2013. Summary: Allegations of Fraudulent Sale of Property: The Petitioners alleged that M/s. Vikram Structures Pvt. Ltd. (R-1) sold a total area of 2,43,037 sq. ft., whereas the company was entitled to sell only 82,216.30 sq. ft. as per the Joint Development Agreement (JDA). The company collected Rs. 136,50,19,085/- by executing 164 Sale Deeds or Agreements to Sell. The company and its directors allegedly sold the same property multiple times by specifying only the area and floor, luring buyers with fake rental assurances through lease agreements with M/s. Innovent Spaces Pvt. Ltd. (R-16) and M/s. Project Craft Solutions (R-17). The Petitioners provided specific details of these transactions, which were not contested by the Respondents. Violation of Court Orders and Collusion: The company and its directors allegedly violated an injunction order dated 27.04.2019 by the City Civil and Sessions Judge, Bangalore, in CS No. 3301 of 2019. The owners of the land, despite knowing the fraudulent activities, did not inform the buyers and withdrew the suit, aiding the company in defrauding the buyers. The Petitioners sought an investigation into the affairs of the company and related parties u/s 213 of the Companies Act, 2013. Request for Investigation: The Tribunal referred to Section 213 of the Companies Act, 2013, which allows investigation into a company's affairs if there are circumstances suggesting fraudulent conduct. The Petitioners, being buyers of units in 'VSPL Pinnacle,' provided specific details and documents supporting their allegations. The Respondent No. 1 (R-1) did not contest these allegations. The Tribunal noted that the company was ordered to be liquidated, but it retained its corporate existence and could be investigated. Decision: The Tribunal allowed the petition and directed the following: (a) The Petitioners' Counsel to forward all material documents to the Central Government within three weeks. (b) The Central Government to investigate the affairs of R-1 Company and related parties by appointing Inspector(s) u/s 213(b) of the Companies Act, 2013. (c) The Liquidator of R-1 Company to cooperate with the Petitioners in handing over requisite documents. (d) The Registry to forward a copy of the order to the Ministry of Corporate Affairs for necessary follow-up action.
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