2021 (11) TMI 198 - Tri - Companies Law

Seeking direction to make repayment of the deposit along with interest due thereon at 18% per annum - Section 73 (4) of the Companies Act, 2013 - HELD THAT - In order to decide the issue whether the amount in question was deposited on the request of the respondent in order to overcome the financial difficulties faced by the company, when a question was put to both sides, as in whose bank account the deposit of ₹ 30,00,000/- was credited by the petitioner, both sides could not answer the question. Hence, the Bench directed both the parties to submit their respective bank account details for the relevant period with regard to the deposit of ₹ 30,00,000/- with an affidavit. Both sides filed affidavit enclosing the bank account details. On-going through the bank account details produced by the respondents, it is seen that the amount in question has been credited to the account of Kerala Trade Centre, which is a separate entity. The Company Petition has been filed against Kerala Chamber of Commerce and Industry as the respondent. The payments have not been made to the account of respondent company, but to the account of Kerala Trade Centre, a joint venture bank account which is maintained and handled separately for the purpose of construction, development and selling of apartments under the brand name 'Kerala Trade Centre'. This application filed against Kerala Chamber of Commerce and Industry will not stands scrutiny and is without any merits - Petition dismissed.

Summary

Issues:
Company petition under Section 73(4) of the Companies Act, 2013 for repayment of deposit with interest at 18%.

Analysis:
The petitioner, a shareholder of the respondent company, deposited ?30,00,000 with the company during financial difficulties. The respondent claimed the payments were for purchasing space in a joint venture project, not as a loan. The petitioner sent a demand notice for repayment, which went unanswered. The respondent alleged collusion between the petitioner and others led to financial losses and litigations, diverting funds into projects causing bankruptcy. The respondent maintained the payments were accounted for in the joint venture project. The respondent also suspended the petitioner for misconduct.

The Tribunal reviewed the case records and arguments. The petitioner claimed the amount was deposited to assist the company, while the respondent argued it was for space booking charges. Both parties were directed to submit bank account details for the deposit, revealing the amount was credited to the joint venture entity, not the respondent company. As the payments were made to the joint venture account, not the respondent's account, the petition against the respondent was dismissed. The petitioner was advised to seek remedies against the joint venture entity if desired.

In conclusion, the Company Petition against the respondent was dismissed as the payments were for the joint venture project, not a loan to the respondent company. The petitioner was directed to explore legal remedies against the joint venture entity if necessary.