9911796707
TMI Blog1983 (3) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... ndustries (Karnataka) P. Ltd., Hospet; for a declaration that the notice dated May 25, 1982, issued by the company, a copy of which is at Ex. O to the petition to be illegal, void and not enforceable against the petitioner and pass an order directing the respondent-company to forbear from exercising its lien on the fully paidup shares held by the petitioner and from selling the said shares. In the alternative, he has prayed that the respondent-company and its directors be directed to transfer the shares held by the petitioner for a fair present market value and pay the sale proceeds to the petitioner forthwith. To summarise the averments in the petition, the following few facts may be stated : The petitioner and respondents Nos. 2 to 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e than 1/4th of the shares of the company and the company has been mismanaged as shown in the balance-sheet for the period ending December 31, 1981, which is one of the exhibits produced. It shows that the company has incurred loss of rupees two lakhs and, therefore, it is contended, the affairs of the company are not managed in public interest and the directors are trying to recover the sum of Rs. 80,000 said to be due from the petitioner and others have filed suits in respect of alleged loans advanced by them. It is said that the sums demanded are not only due from the petitioner but also from his erstwhile partners in the earlier dissolved firm. It is these acts the petitioner alleged as mismanagement, oppression to the minority sharehol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment or damage to public interest is proved to the satisfaction of this court, the court may proceed to eliminate the oppression or prevent the damage to public interest and make appropriate orders including an order winding up the company if oppression cannot be eliminated. As already narrated earlier, the petitioner is a chronic litigant with his fellow shareholders who are none other than respondents Nos. 2, 3 and 4. Time and again he has settled the matter out of court. The petitioner admits that any suit which the company or others have filed against him for recovery of monies will be defended by him. Therefore, mere filing of a suit against him by the parties cannot be said to be any oppression to him. No material is placed before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If a certain sum of money is said to be due by the petitioner to the company, the company has to establish that that sum is due in accordance with law. In other words, the company has to first obtain a decree for that sum which is owed by the petitioner and, thereafter, resort to the board's power to exercise the lien which is claimed for the company. If a suit is filed, the petitioner will have his defence in that suit. Therefore, the alternative prayer made, to which I have referred earlier, does not survive for consideration in this proceeding. I am constrained to remark that no material other than the balance-sheet is produced to show that the company's affairs are not managed well except to show that the directors are drawing sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the principles of dissolution of partnership cannot be liberally invoked. Besides, it is only when shareholding is more or less equal and there is a case of complete deadlock in the company on account of lack of probity in the management of the company and there is no hope or possibility of smooth and efficient continuance of the company as a commercial concern, there may arise a case for winding up on the just and equitable ground. In a given case, the principles of dissolution of partnership may apply squarely if the apparent structure of the company is not the real structure and on piercing the veil it is found that in reality it is a partnership". From the above enunciation, it is clear that the petitioner who holds only 1/4th of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
