2017 (8) TMI 1199 - Tri - Companies Law

Oppression and mismanagement - Petitioner satisfying the requirement of Section 399 of the Companies Act, 1956 in order to maintain the petition - Held that - In the absence of any prima facie evidence to sustain the plea of the petitioner in relation to the shareholding in the lst respondent company and to corroborate the plea of equal participation and shareholding of the petitioner, the only document which is required to be considered in relation to shareholding is the Form 2 as filed with the Registrar of Companies, NCT of Delhi & Haryana by the petitioner himself and which has been categorized by the said authority as under Management Dispute . The consistent refrain of the petitioner in the entire petition has been that as between himself and the second respondent there was an understanding of equal shareholding. However, even assuming that the enhanced authorized capital and the allotment of equity capital on 30.03.2010, suo moto, by the petitioner to himself and to his nominees are taken into consideration the same is clearly in excess of the understanding as it almost comes to 74.5% of the capital of the 1st respondent company and in clear violation of the same demonstrating that the petitioner has not come before this Tribunal with clean hands which is also a pre-requisite for invoking the equitable jurisdiction of this Tribunal. Further it is seen that along with the petitioner, Mr Narayan Ladu Mandrekar, his associate seems to have been also allotted shares to the extent of 1,60,000 equity shares of Rs.l0 each. However, the said Mr. Narayan Ladu Mandrekar, claimed by the petitioner initially to be his acquaintance had given an affidavit (Annexure XXVI) dated 28.12.2011 filed by the respondents in their typed set to the effect that the deponent therein never had any interest in the Delhi based company, A. R. Plaza Pvt Ltd. (the first respondent company) either as a director or a shareholder or in any other capacity. Thus dismiss the petition on the issue of maintainability arising out of Section 399 of the Companies Act, 1956

Summary

Issues Involved:
1. Maintainability of the petition under Sections 397 and 398 of the Companies Act, 1956.
2. Allegations of oppression and mismanagement by the respondents.
3. Validity of share allotment and directorship removal resolutions.
4. Alleged manipulation and fraudulent activities by the respondents.
5. Delay and laches in filing the petition.

Detailed Analysis:

1. Maintainability of the Petition:
- Section 399 Requirements: The petitioner must satisfy the requirements of Section 399 of the Companies Act, 1956, which mandates holding at least 10% of the issued share capital or obtaining consent from other shareholders.
- Petitioner's Shareholding Claim: The petitioner claims to hold 46% of the equity share capital, but the respondents dispute this, asserting that the petitioner is not a shareholder.
- Evidence of Shareholding: The petitioner relies on Form 2 (return of allotment) filed with the Registrar of Companies, which the respondents contest as invalid. No share certificates or transfer documents were produced by the petitioner.
- Memorandum of Understanding (MoU): The petitioner alleges an MoU promising equal shareholding, but no such document was produced. The compromise agreement of June 2010 was also not submitted.
- Conclusion: The Tribunal found a lack of prima facie evidence to support the petitioner's claim of shareholding, leading to the dismissal of the petition on maintainability grounds.

2. Allegations of Oppression and Mismanagement:
- Petitioner's Allegations: The petitioner alleged oppression of his shareholding rights and mismanagement by the respondents, including manipulation of shareholding, removal from directorship, and illegal allotment of shares.
- Respondents' Defense: The respondents denied the allegations, asserting that the petitioner was never a shareholder and that the petition was delayed and lacked merit.
- Tribunal's Observation: The Tribunal noted the absence of concrete evidence to support the petitioner's claims, particularly the lack of share certificates and the disputed Form 2.

3. Validity of Share Allotment and Directorship Removal Resolutions:
- Share Allotment: The petitioner challenged the allotment of 240,000 equity shares to the 2nd respondent and subsequent allotments. The respondents claimed these allotments were made with the petitioner's knowledge and consent.
- Directorship Removal: The petitioner contested his removal as a director under Section 284 of the Companies Act, 1956. The respondents argued that due process was followed.
- Tribunal's Conclusion: The Tribunal did not delve into the merits of these issues due to the dismissal of the petition on maintainability grounds.

4. Alleged Manipulation and Fraudulent Activities:
- Petitioner's Claims: The petitioner alleged that the respondents manipulated shareholding records, forged signatures, and engaged in fraudulent activities to usurp his shareholding.
- Respondents' Rebuttal: The respondents denied these allegations, contending that the petitioner was not involved in the company's affairs and that all transactions were legitimate.
- Tribunal's Stance: The Tribunal did not address these allegations in detail due to the preliminary dismissal of the petition.

5. Delay and Laches in Filing the Petition:
- Respondents' Argument: The respondents argued that the petition was delayed and barred by laches, as the alleged events occurred years before the petition was filed.
- Petitioner's Response: The petitioner contended that the delay was due to ongoing disputes and attempts at compromise.
- Tribunal's Decision: The Tribunal acknowledged the delay but primarily dismissed the petition based on the lack of evidence to establish the petitioner's shareholding.

Conclusion:
The petition was dismissed on the grounds of maintainability, as the petitioner failed to provide sufficient evidence of his shareholding in the 1st respondent company. The Tribunal did not address the merits of the case due to this preliminary issue. The dismissal does not preclude the petitioner from pursuing other legal remedies.

Order:
The petition is dismissed without costs.