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Showing 461 to 480 of 735 Records
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2009 (11) TMI 515
Injuction relief claimed - Held that:- The appellants, in our considered view, have undoubtedly been able to establish a prima facie case that they are in-charge of the company having shareholding and the society does not figure in the list of shareholders. Once the company is controlled by the appellants group, its functioning cannot be brought to a standstill by the nature of the impugned order passed whereby both the parties have been restrained from dealing with the assets of the company.
We are, thus, of the considered view that the impugned judgment cannot be sustained and we hold that the appellants have made out a case for interim relief having satisfied the triple test for grant of interim injunction and no order can operate against them or in favour of the respondents. The respondents, their agents and employees are, thus, restrained from representing themselves as shareholders or directors of the said company and consequent thereto are restrained from acting on behalf of the company by using any letterhead, bank accounts or dealing with the assets of the company in any manners whatsoever and cannot be permitted to file any statutory forms or returns on behalf of the company. This injunction would operate during the pendency of the suit.
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2009 (11) TMI 514
Strike name of the company off the registers - whether the company which was incorporated on 1-6-1984 had, in fact, never commenced its functioning and at any rate, it had become a defunct company from 1-2-1989?
Held that:- Though counter-affidavit has been filed on behalf of the respondent, he did not deny the receipt of Ext. P3 therein. Ext. P3 carries a specific request to strike off the name of the company from the registers by invoking the power under section 560(1) of the Companies Act, 1956, There is no explanation in the counter-affidavit as to why Exts. P3 and P4 carrying the aforesaid request were not considered. An authority clothed with a power is bound to exercise the same when it is called upon to exercise that. The disuse of that power is equally contemptuous as abuse or misuse of power. In the absence of a denial with regard to Ext. P3, I think the petitioner is perfectly justified in asking for a direction to the respondent to consider Ext. P3 and to take appropriate action thereon in terms of section 560(1) of the Companies Act, 1956.
Therefore, there will be a direction to the respondent to pass appropriate orders on Ext. P3 by invoking the power under section 560(1) of the Companies Act, 1956
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2009 (11) TMI 513
Dishonour of cheques for insufficiency of funds in account - Held that:- Since there is no allegation that the cheques were issued and dishonoured with the consent or connivance of the petitioner or that issue and dishonour of the cheques was otherwise attributable to any neglect on his part, the case of the complainant as regards the petitioner is not covered even under sub-section (2) of section 141 of the Negotiable Instruments Act, 1881. Since a consultant is not even an officer of the company, he having been engaged only on contractual basis, it is doubtful whether he would be covered even under sub-section (2) of section 141 of the Negotiable Instruments Act. I, however, need not go into this aspect as there is no allegation in the complaint imputing the requisite consent, connivance or neglect to the petitioner.
Thus no offence under section 141 of the Negotiable Instruments Act, read with section 138 thereof is made out against the petitioner on the basis of the complaints filed by the respondent
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2009 (11) TMI 512
Whether the case is covered under section 633(2) of the Companies Act, inasmuch as, that there are no charges against the petitioner in the F.I.R. directly?
Held that:- This Court comes to a definite conclusion that this petition under section 633 of the Companies Act is not maintainable in the present circumstances. The proceedings under sections 120B, 467, 468, 471 and 477A I.P.C. are definitely the proceedings outside of the purview of section 633(2) of the Companies Act. The petition is dismissed. Interim order, if any, operating in this writ petition, is discharged.
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2009 (11) TMI 511
Issues Involved:
1. Transfer of shares without RBI acknowledgment.
2. Validity of proxies.
3. Election of directors not aligning with the agenda.
4. Purpose of declaring results given the tenure expiration.
Detailed Analysis:
1. Transfer of Shares Without RBI Acknowledgment:
The court examined the interplay between the Companies Act, 1956, and the Banking Regulation Act, 1949, particularly section 12(2) of the Banking Regulation Act, which restricts voting rights to 10% of the total voting rights of all shareholders. The court noted that while section 12(2) restricts voting rights, it does not invalidate the transfer of shares. The court also considered various RBI Circulars requiring acknowledgment for transfers but concluded that these Circulars do not override the property rights in shares. The court held that the voting rights of the transferees could at most be restricted to 10% but cannot be entirely annulled.
2. Validity of Proxies:
The court upheld the chairman's decision to accept the proxy executed later in time and reject both if executed on the same day, citing practical constraints and the necessity of maintaining order during the meeting. The court referenced the principles of agency law and previous judicial decisions to support this approach, noting that a shareholder distributing multiple proxies cannot later claim a valuable right was lost due to their own actions.
3. Election of Directors Not Aligning with the Agenda:
The court found that the notices for the 83rd and 85th AGMs provided sufficient indication of the business to be transacted, including the election of directors. The court noted that no objections were raised during the meetings, and the shareholders understood the agenda. The court referenced the articles of association, which allowed filling up vacancies even if not explicitly mentioned in the notice, and concluded that the election of seven directors was valid.
4. Purpose of Declaring Results Given the Tenure Expiration:
The court rejected the argument that declaring the results would serve no purpose due to the expiration of the directors' tenure. The court emphasized that the delay in holding the AGMs was not due to the directors' fault but due to ongoing litigation. The court noted that the directors have not assumed office and the declaration of results is necessary for the proper functioning of the bank.
Conclusion:
The court dismissed the application, directing the Tamil Nadu Mercantile Bank to declare the results of the elections held at the 83rd and 85th AGMs. The court emphasized the need for a full complement of the board of directors to manage the bank effectively and directed the bank to call for the next AGM within the stipulated time.
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2009 (11) TMI 510
Whether on account of merger of a company, the transferee company is required to pay registration fee due to consequential increase of authorised share capital of the transferee company ?
Held that:- Appeal dismissed as in the case of such merger no such payment of fee to the Registrar of Companies or stamp duty to the State Government shall be payable. See Cavin Plastics case [2007 (11) TMI 412 - HIGH COURT OF MADRAS]
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2009 (11) TMI 509
Amalgamation scheme - Held that:- Allow this petition and grant sanction to the proposed scheme of arrangement/amalgamation as prayed, however, with a modification to the extent that the appointed date for amalgamation will be 1-1-2010 in place of 1-4-2009. The sanction to the scheme of amalgamation shall not anyway dispense with the requirement of execution of any instrument necessary for vesting of property and the rights of the transferor and transferee-companies.
Shri Vijayesh Atre, learned counsel appearing for the Companies has stated that the transferor-company is ready, willing and is agreed to pay as sum of ₹ 30,000 by demand draft to the “Common Pool Fund” maintained by the Official Liquidator attached to this Court. He submits that the same shall be paid within four weeks. The costs of ₹ 5,000 be paid to the Regional Director within four weeks. A separate order as required under rules 81 and 84 in Form Nos. 41 and 42 is, accordingly, passed.
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2009 (11) TMI 508
Maintainability of the Winding up Petition - Held that:- A petition for winding up cannot be maintained upon a claim for damages. Damages become payable only when they are crystallized upon adjudication. Until and unless an adjudication takes place with a resultant decree for damages, there is no debt due and payable. Damages require adjudication. Until then, the liability of a party in alleged breach of a contract does not become crystallized
Thus the Company Petition would have to be dismissed on the ground that it is not maintainable, leaving it open to the Petitioner to have recourse to its remedies in accordance with law.
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2009 (11) TMI 507
Whether there was not an iota of evidence before the Appellate Tribunal to draw the conclusion that at the time when the contravention was committed the petitioner was incharge of and was responsible to the company for the conduct of the business of the company?
Held that:- In the present case, the record reveals that this was an admission by the company itself through its Company Secretary in the reply dated 26-3-2001 wherein it was stated that the present petitioner is a director of the company. This was an answer to the specific averment made in the show-cause notice that Shailendra Swarup was incharge of the affairs of the company and responsible to it for the conduct of its business. This finding of the Adjudicating Authority was not faulted with by the Appellate Tribunal and rightly so. Appeal dismissed.
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2009 (11) TMI 506
Compromise and arrangement - Held that:- No reason to decline to exercise my discretion or to modify the scheme in any manner. No ground has been brought to my notice to deny relief to the petitioner. There is no reason to hold that the shareholders or creditors would be prejudicially affected or that the reduction is not fair or equitable. Accordingly the reduction of the paid up share capital of the company by ₹ 12,69,00,810 and conversion of the same as unsecured loans from the respective shareholders is confirmed as approved by the shareholders by resolution dated 19-12-2008 and the reduction of share capital and the compromise and arrangement with the shareholders are hereby sanctioned without any modification.
The sanctioned scheme of arrangement and compromise with the shareholders shall be published in one issue of Mathrubhumi daily and one issue of Indian Express daily in their editions having circulation in and around Thrissur within two weeks after registration of the same with the Registrar of Companies, for which purpose a certified copy of this order shall be delivered to him within 21 days from today. Publication in the Official Gazette is dispensed with. The company petition is allowed as above. The Registry shall issue order in the appropriate from prescribed under the Companies (Court) Rules.
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2009 (11) TMI 505
Issues:
Petition under sections 391 and 394 of the Companies Act, 1956 seeking amalgamation of multiple companies and conversion of debt into equity.
Analysis:
The petition filed under sections 391 and 394 of the Companies Act, 1956 seeks the amalgamation of several companies, including Ganesh Synthetics Private Limited, Abhinav Investments Private Limited, Ginni Power Limited, and Goodworth Merchants Private Limited, with Ginni Filaments Limited. The scheme of arrangement also includes the conversion of debt owed by the Transferor Companies into equity in the Transferee Company. This conversion aims to maintain a debt equity ratio of 1.85, as decided by the term lenders of the transferee company. The Corporate Debt Re-structuring Cell, established by the Reserve Bank of India, has approved the conversion of unsecured loans into equity, as per communications submitted by the applicant company.
The scheme of amalgamation was initially approved by the Board of Directors of the involved companies. Following approvals, a court order was issued for the convening of meetings with shareholders, secured creditors of Transferor Companies, and unsecured creditors of the Transferee Company. Compliance with court orders included publishing notices in newspapers and holding meetings as directed. Reports from chairpersons overseeing these meetings were submitted to the court.
The Regional Director of Company Affairs filed a report with minimal objections, primarily emphasizing compliance with accounting standards. The Official Liquidator raised objections specifically regarding the conversion of debts into equity, which were countered by the applicant company. The applicant highlighted that the conversion process was monitored by the Corporate Debt Re-structuring Cell, ensuring transparency and compliance with financial regulations.
Acknowledging the monitoring by the Corporate Debt Re-structuring Cell and the compliance with accounting standards, the court found the objections raised by the Official Liquidator adequately addressed. The court approved the petition for confirmation, subject to the conditions of restructuring under the monitoring of the Corporate Debt Re-structuring Cell and compliance with relevant accounting standards and legal requirements under the Companies Act and Company Rules.
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2009 (11) TMI 504
Direction to petitioner as a legal representative to deposit ₹ 1,00,000,00 from the estate of the deceased, i.e., Mr. Bharat Thacker
Held that:- The petitioner being a legal representative will be liable to the extent that she has inherited the estate from late Mr. Bharat Thacker. The estate of late Mr. Bharat Thacker is liable and can be attached and forfeited under provisions of the Foreign Exchange Regulation Act, 1973, on account of the adjudication order passed against Mr. Bharat Thacker. This is, therefore, necessary to enquire about the total estate left behind by late Mr. Bharat Thacker. No such enquiry was made and gone into. The petitioner herein has also not filed any affidavit stating and giving details of the estate left behind by late Mr. Bharat Thacker, what has happened to the said estate and who has inherited the same. In case late Mr. Bharat Thacker has left behind any estate, learned Appellate Tribunal is competent to pass an appropriate order to protect interest of the respondent department, even if the same is in possession/control of a third party, other than the petitioner herein. The petitioner cannot obviously object or protest against any such order, for she is not adversely affected and has not inherited the estate. Inheritance is subject to the first charge of the respondent.
In these circumstances, the impugned order dated 8-2-2007, to the extent it relates to appeal No. 37/2000 is set aside and the matter is remanded back for fresh adjudication on the application for waiver of pre-deposit
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2009 (11) TMI 503
Winding up - auction sale of company’s property challenged - Held that:- At the outset we would reject the appeal of Sukhchainsingh because Sukhchainsingh had never offered any bid muchless higher bid than the successful bidder respondent No. 3 before confirmation of sale on 19-8-2009 and did not espouse his cause before the Learned Company Judge at an appropriate stage before confirmation of sale on 19-8-2009. In these circumstances, the appeal preferred by Sukhchainsingh, being Co. Appeal No. 7/2009, has no merit and substance and we dismiss it without any hesitation.
In view of the undisputed facts floating on surface of record the original offer of ₹ 31 crores, which during the course of this appeal was revised to ₹ 35 crores, does not appeal to us so as to set aside the confirmed sale made by the Learned Company Judge in favour of the respondent No. 3. We feel disposed to take note of the fact that the EMD of ₹ 6 crores as deposited by the respondent No. 3 on 8-5-2008 was lying for more than a year with the Official Liquidator. Even by straight calculation this amount of ₹ 6 crores lying deposited with the Official Liquidator, if had not been deposited, would have been used by the respondent No. 3 and it could have at least fetched interest of ₹ 6 lakhs per month in the ordinary course of business. On the contrary the appellant did neither deposit any Earnest Money nor 18 per cent of his offer in violation to the court order which does not portray the picture of a bona fide and higher offerer. In these circumstances we are unable to hold that the appellant has made out any case calling for our interference in the matter. We are also unable to hold that the impugned orders dated 6-5-2009, 19-8-2009 and 8-10-2009 suffer from any illegality and we uphold the same. The appeal fails and is hereby dismissed with cost of ₹ 25,000. Thus company appeal No. 8/09 dismissed with costs of ₹ 25,000 payable by the appellant to the respondent No. 3.
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2009 (11) TMI 502
Duties of Merchant Banker - Held that:- The Banking Regulation Act, 1949, under sections 35(a) and 36, vests powers in the Reserve Bank of India to give directions to the Banks. Therefore, we had given a direction to the Reserve Bank of India to regulate the functioning of the Banks, as to act as a Loan Arranger, in our view, is not a part of the duties of Merchant Banker and the same is alien to banking system as per the provisions of various statutes.
The grievance of the applicant that the observations made by us and the directions issued are detrimental to his interest, is unfounded. Hence, there is no merit in the present review application and the same is dismissed with no order as to costs.
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2009 (11) TMI 501
Winding up - auction sale of company’s property challenged - Held that:- At the outset we would reject the appeal of Sukhchainsingh because Sukhchainsingh had never offered any bid muchless higher bid than the successful bidder respondent No. 3 before confirmation of sale on 19-8-2009 and did not espouse his cause before the Learned Company Judge at an appropriate stage before confirmation of sale on 19-8-2009. In these circumstances, the appeal preferred by Sukhchainsingh, being Co. Appeal No. 7/2009, has no merit and substance and we dismiss it without any hesitation.
In view of the undisputed facts floating on surface of record the original offer of ₹ 31 crores, which during the course of this appeal was revised to ₹ 35 crores, does not appeal to us so as to set aside the confirmed sale made by the Learned Company Judge in favour of the respondent No. 3. We feel disposed to take note of the fact that the EMD of ₹ 6 crores as deposited by the respondent No. 3 on 8-5-2008 was lying for more than a year with the Official Liquidator. Even by straight calculation this amount of ₹ 6 crores lying deposited with the Official Liquidator, if had not been deposited, would have been used by the respondent No. 3 and it could have at least fetched interest of ₹ 6 lakhs per month in the ordinary course of business. On the contrary the appellant did neither deposit any Earnest Money nor 18 per cent of his offer in violation to the court order which does not portray the picture of a bona fide and higher offerer. In these circumstances we are unable to hold that the appellant has made out any case calling for our interference in the matter. We are also unable to hold that the impugned orders dated 6-5-2009, 19-8-2009 and 8-10-2009 suffer from any illegality and we uphold the same. The appeal fails and is hereby dismissed with cost of ₹ 25,000. Thus company appeal No. 8/09 dismissed with costs of ₹ 25,000 payable by the appellant to the respondent No. 3.
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2009 (11) TMI 500
Property for auction sale put by bank - failure to discharge the liability by the company - Held that:- it is apparent that the contentions raised on behalf of respondent-bank based on provisions of section 17 of the Securitisation Act also need not come in way insofar as the petition is concerned. Even if an alternative statutory remedy is available the court is not precluded from exercising its discretionary jurisdiction in entertaining the petition wherein the challenge to action of the respondent establishes that the same is in violation of statutory provisions.
In the circumstances, the action of respondent-bank in rejecting the offer of settlement as well as the tentative decision to dispose of the property in favour of respondent No. 2 for a sum of ₹ 2.15 crore cannot be sustained. Respondent-bank is directed to return the amount of ₹ 2.15 crore deposited by respondent No. 2 within a period of three working days from today along with interest at the rate applicable to a savings account, without waiting for a certified copy of this judgment. Learned advocate for the respondent-bank is directed to intimate the respondent-bank about this direction to ensure compliance by respondent-bank.
Respondent-bank is further directed to undertake the process of disposal of the property in question once again in accordance with law, after complying with statutory requirements from the stage of possession notice under section 8(1) of the Rules. It will be open to respondent-bank to consider the proposal of settlement made by the company and negotiate further terms in this regard, if respondent-bank so desires
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2009 (11) TMI 499
Winding up - Circumstances in which a company may be wound up - Held that:- Except for the petitioner asserting that the respondent is commercially insolvent and incapable of paying its debts, there is not a trite of evidence to substantiate the fact that the respondent has abandoned the objects of its business or that the substratum of the company is gone. Therefore, it is not possible for this Court to accept the contention that the respondent-company is unable to meet its outstandings.
The machinery for winding up will not be allowed to be utilised merely as a means for realising debts due from a company. Petition rejected.
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2009 (11) TMI 498
Whether the Company Law Board was fundamentally in error in circumscribing the power of the Board to implead "any person" under section 405 to only those categories of persons stipulated under section 402(e) of the Act?
Held that:- This court has come to the conclusion that the interpretation that has been by the Board on the provisions of section 405 is erroneous. Having decided the question of law relating to the interpretation of the section 405, it would be, but appropriate for this Court to remit the proceedings back to the Company Law Board for a decision afresh, on the application for impleadment. The Board is a primary fact finding authority and should be left to determine the question of impleadment in the light of the interpretation that has been placed by this Court on the provisions of section 405.
The proceedings are remitted back to the Company Law Board, which shall pass an order upon remand after hearing the parties. All the rights and contentions of the parties are kept open.
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2009 (11) TMI 497
Wavier of pre-deposit - Adjudicating Authority while arriving at the service tax liability had granted the abatement of research & development cess paid by the appellant - Commissioner as a revisionary authority had denied the abatement - Held that: - appellant is eligible for the benefit of abatement of research & development cess paid by them - waiver of the pre-deposit of the adjudged dues is allowed and recovery thereof stayed till the disposal of the appeal
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2009 (11) TMI 495
Issues Involved:1. Continuation of investigations under FERA after its repeal. 2. Validity of the opportunity notice issued under Section 61(2) of FERA. 3. Validity of the appointment of the Enforcement Officer under Section 4 of FERA post-repeal. Issue-wise Detailed Analysis:Ground No. 1: Continuation of Investigations under FERA after its RepealSection 49 of the Foreign Exchange Management Act (FEMA), 1999, addresses the repeal of the Foreign Exchange Regulation Act (FERA), 1973. Sub-section (3) prohibits courts from taking cognizance of offences under the repealed Act after two years from the commencement of FEMA. However, sub-section (4) states that offences committed under FERA shall continue to be governed by its provisions as if it had not been repealed. This implies that investigations into offences committed under FERA can continue post-repeal. The court clarified that sub-section (5)(a) of Section 49 does not prohibit the continuation of investigations but validates actions initiated under FERA to the extent they are not inconsistent with FEMA. Additionally, Section 6 of the General Clauses Act supports the continuation of investigations, legal proceedings, or remedies as if the repealing Act had not been passed. The court concluded that investigations into FERA offences could continue even after its repeal, dismissing the petitioners' argument. Ground No. 2: Validity of the Opportunity Notice Issued under Section 61(2) of FERAThe petitioners argued that the opportunity notice dated 22nd May 2002 did not comply with Section 61(2) of FERA, as it provided insufficient time to respond. The court noted that the notice is not a show-cause notice but an opportunity for the accused to show that they had the requisite permission from the Reserve Bank of India (RBI). The notice's purpose is to allow the accused to present any permission they might have had, not to justify their actions. The court observed that the petitioners did not claim to have the requisite permission in their reply. The court also noted that the respondents considered the petitioners' reply before filing the complaint, as evidenced by the selective prosecution of some noticees. The court found no merit in the argument that the three-day period was insufficient, as the petitioners did not indicate they had the requisite permission from RBI. The court dismissed the petitioners' contention, citing the Supreme Court's decision in Standard Chartered Bank v. Directorate of Enforcement, which clarified the limited scope of the opportunity notice under Section 61(2) of FERA. Ground No. 3: Validity of the Appointment of the Enforcement Officer under Section 4 of FERA Post-RepealAlthough not pressed during arguments, the petitioners contended in their written synopsis that the appointment of the Enforcement Officer under Section 4 of FERA was invalid post-repeal. They argued that FEMA does not provide for offences and violations of the nature alleged in the complaint, and investigations should be conducted by an officer not below the rank of an Assistant Director. The court found no merit in this contention, stating that no provision of FEMA invalidates the appointment of an Enforcement Officer under FERA. The court clarified that the powers of an Enforcement Officer to investigate offences under FERA do not end with the enactment of FEMA. The court concluded that the appointment of the Enforcement Officer was not inconsistent with FEMA, dismissing the petitioners' argument. Conclusion:The court dismissed the petition, finding no merit in the arguments presented by the petitioners. The court held that investigations into offences committed under FERA could continue post-repeal, the opportunity notice complied with Section 61(2) of FERA, and the appointment of the Enforcement Officer under FERA remained valid after its repeal.
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9911796707
