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TMI Blog2015 (12) TMI 1694X X X X Extracts X X X X X X X X Extracts X X X X ..... petition has been filed is that the petitioners have obtained consent from the other shareholders, viz., Mr. Partha Sarathi Ghosh and Mrs. Kaberi Ghosh who held more than one-tenth of the issued share capital of the company, which is false as the number of members holding issued share capital in the company is 34 and as such, the petitioners despite the consent letter cannot constitute the one-tenth of the total number of members and therefore, the company petition is not maintainable under the provisions of section 399 of the Companies Act, 1956. In any event, the purported consent letters as well as the signatures have not been properly obtained in accordance with the provisions of the Companies Act and the Rules and Regulations framed thereunder. Hence, the consent letter cannot be treated to be a consent letter in terms of section 399 of the Companies Act, 1956. Moreover, the said consenting members have not been arrayed as party in the present proceeding. It has been highlighted that Mr. Partha Ghosh has been looking after the pharmaceutical division of the company and had all along taken active role in the affairs and management of the company and also was aware of the decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons (India) Ltd., merged, was almost similar. Accordingly, after the change of name of the company, the company was run as a family-run business as was always understood by and between the parties and the family members. 1.3 Besides, it has been submitted that there was a major setback in the business of the company due to the disintegration of the Soviet Republic as the company used to export tea mostly to Russia. However, the company sustained itself by selling tea in the local market and also, by making exports to other countries, but the turnover of the company has been dwindled from Rs. 100 crores in 1990s to Rs. 22 crores in the year 2000. Thereafter, there was again a slump in tea business and accordingly, it was decided that the money of the business should be invested in mutual funds, when petitioner No. 1 was the chairman-cum-managing director of the company and during such period, considerable sum of money was invested in mutual funds. However, after leaving of petitioner No. 1 from the board, the mutual funds of the company came to be handled solely by Mr. Nayan Ranjan Ghosh (respondent No. 5). However, when the value of funds considerably depleted in a span of hardly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of Rs. 4 crores to a subsidiary of the company is completely false as no money was ever paid to respondent No. 7 or any other company for any purpose whatsoever. It has also been submitted that petitioner No. 1 and the consenting shareholders had accepted dividends between the years 2008 to 2014. It has been categorically averred that petitioner No. 1 being a disgruntled member seeks to derail the progress of the company made in the tea business and also, the acts complained off do not constitute any act of oppression. Apart from this, it has also been highlighted that the petitioner and consenting shareholders had accepted dividends during the years 2008 to 2014. In the reply-affidavit, the petitioners/non-applicants advocate submitted that the petitioners and the consenting shareholders comprise of not less than one-tenth of the total number of shareholders of respondent No. 1-company as would be evident from the annual return filed by the company (page 142 of the main company petition). In addition, it has been denied that there are 34 members holding shares in respondent No. 1-company and in fact, the number of members is 30. It has also been denied that the consent letters ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondents are responsible for the depletion as they failed to understand the market. It has been contended that the investments of respondent No. 1-company are being siphoned away by the respondents for their personal gain. Also, there is no evidence from which it would appear that the board decided to utilise the mutual funds and investments for the tea business. In addition, it has been denied that the payment of Rs. 4 crores to a subsidiary is false and also, no money was paid to respondent No. 7. Moreover, incorrect facts about the payment of dividends have been stated. In fact, the said dividends have not been paid in accordance with the actual entitlement of the petitioners. 2. Respondent No. 6/non-applicant advocate also filed the reply affidavit to the instant company application, wherein it has been stated that petitioner No. 1 was inducted as a director of the company after the company suffered a major setback in tea sales after the Russian Federation disintegrated. Also, he was inducted into the company to streamline the investments of the company and also, to secure the company's future through its investments. Further, petitioner No. 1 became the chairman of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpany need to be liquidated for the said purpose. It has been alleged that the instant company application is taken out only to delay the justice to the petitioners and also, the same is an abuse of the process of this hon'ble Board and as such, the contention of the applicant is barred by the principles of estoppels, waiver, acquiescence and/or principles of analogous thereto. 2.3 In the rejoinder affidavit, respondents Nos. 1 to 4/applicants' advocate has raised a question about the power of attorney of the deponent (Mr. Partha Sarathi Ghosh ) on which basis he has purportedly affirmed the reply affidavit and also, assailed that the said affidavit has not been affirmed in proper forum. It has been averred that the contents of the main company petition are all untrue and incorrect. In addition, it has been submitted that in terms of the understanding between the family members, each branch is represented at the board. Even, the petitioner's brother was representing the petitioners in the board. Rather, the deponent (Mr. Partha Sarathi Ghosh ) cannot have any personal knowledge being a constituted attorney as to whether petitioner No. 1 was represented at the meeting o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied and disgruntled with the long standing practice of respondent No. 1-company, has now sought to make false statements only to advance their personal grievances. It has been categorically stated that the deponent has been a director of the company and actively involved in day-to-day activities of the company and all the decisions were taken at the meetings in his presence and/or with his concurrence and as such, the allegations made in the said reply affidavit, are an afterthought. 4. Further, it has been stated that the notice for the annual general meeting was personally served on the deponent and other shareholders and also, sent by post, which were duly received by all the members/shareholders and the meeting was attended by the requisite number of shareholders. It has been pointed out that the deponent, though did not attend the annual general meeting, was fully aware of the business transacted at the annual general meeting and had full knowledge of notice of the said annual general meeting and as such, the allegation of not holding of an annual general meeting is an afterthought and has been taken almost after a year of the said annual general meeting. Also, the deponent h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... persons jointly, they shall be counted only as one member. Further, section 53(4) provides that document may be served by the company on the joint holders of a share by serving it on the joint holder named first in the register in respect of the shares. 5. The petitioners/non-applicants advocate argued that the instant company application is a demurer application bearing various alleged grounds mentioned therein, but none of them are the issues which are to be decided at the preliminary stage before final arguments in view of the fact that at the preliminary stage when a dismissal application is heard and decided, disputed issues of fact are not to be gone into. It has been submitted that the established principle of law is that the statements made in the company petition should be taken to be true and correct, the company petition is not maintainable, it should be dismissed. Moreover, the only contention of the applicants in the instant company application is that the petitioners do not have necessary qualification under section 399 of the Companies Act, 1956 and also, they are less than one-tenth of the total number of members of the company. In this regard, it has been submitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... members to maintain the said company petition under section 399(1) of the Companies Act, 1956. The respondents' advocate contended that there are 34 shareholders and hence, the petitioners along with consenting shareholders being 3 in number do not constitute one-tenth of the total strength of 34 members and thereby, the company petition is not maintainable. On the other hand, the petitioners/non-applicants advocate has denied that there are 34 members holding shares in respondent No. 1-company. On the contrary, it has been asserted that there are only 30 members. Further to this, the petitioners/non-applicants advocate has argued that at the time of filing of the company petition, there were 27 shareholders/members of the company as per the last filed annual return for the financial year ending on March 31, 2013, of which 7 members have died and therefore, there are 20 members. Apart from this, it has been emphatically pleaded by the petitioners/non-applicants that respondents Nos. 1 to 4/applicants have been in the control of the company and the annual returns for the last four years show that there are 27 members and hence, the present argument of the applicants advocate th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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