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TMI Blog2017 (8) TMI 1199X X X X Extracts X X X X X X X X Extracts X X X X ..... s 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 - C.P. NO. 27 (ND) of 2013 - - - Dated:- 31-7-2017 - MR. M. M. KUMAR AND MR. R. VARADHARAJAN, JJ. For The Petitioner : Kundan Kumar Mishra For The Respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of real estate in Goa with the help of one Mr. Narayan Laddu Mandrekar, his friend to four of his other friends, including the 4th respondent herein, who also wanted to participate in the investment and which investment was made in one M/s. Hotel Jackpot Inn, in which the petitioner has a 45% stake and 22.5% of the stake was picked up by his four friends, and it is averred that save the petitioner the investment subsequently was sold by others to certain persons from Delhi. 3. The petitioner further avers that with the assistance of the said Mr. Narayan Mandrekar, he was able to identify four other properties at different locations in Goa namely, at Assagao, Chapora Village, Siolim and Pernem Highway project properties. In the meanwhile the 4th respondent introduced the 2nd respondent and backed him heavily and induced the petitioner into joint venture with 1st respondent. He also made promise to the effect that the petitioner will have a 50% holding in the 1st respondent company and that he would be inducted in the Board of the 1st respondent company and to this effect consent was also obtained on 05.08.2007 from the petitioner. The petitioner was also made to believe that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... construction of flats in various categories. Based on active promotions and marketing for the project named as 'Colonia De Goa', several bookings were made along with advances. Seeing the huge response and the good will earned due to promotions, the 2nd and 4th respondent conspired against the petitioner to have him thrown out of the companies and the projects to usurp his shareholdings and acquisitions. In perpetuation of their conspiracy effectively stonewalled the petitioner access to books of account and to the statutory records of the 1st respondent company and other entities, and even when specifically sought for by the petitioner, the respondents used to avoid giving details on one pretext or the other including in relation to the appointment of 4th respondent at the behest of 2nd respondent and his resignation in the year 2011. In between, it is alleged by the petitioner that the 2nd and 4th Respondents had in connivance with each other perpetrated all the misdeeds. 6. Contrary to the understanding of their contribution vis-a-vis the petitioner in the ratio of 50%:25%:25%, the 2nd and 4th respondents took money from the petitioner to the extent of ₹ 30 Lakh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have it returned, it did not yield any results, but on the other hand was threatened with his life. In the circumstances, the petitioner rushed to Goa airport and lodged complaints with both airport and law enforcement authorities there on 20th and 21st March 2010 including request for production of video recordings at the check in counter. However, fearing investigation and their deeds becoming exposed, the 2nd and 4th respondents through law enforcement authorities convinced that the matter between friends should be settled amicably and the complaint not to be pursued. 8. However, it transpired according to the petitioner that the respondents had in the meanwhile using the stolen papers and records manipulated the shareholding of the legal entities, including that of the 1st respondent company to their favour as given in paragraph 1 herein above, all to the detriment of the petitioner and without his consent or knowledge. Thus the allotment of shares in favour of 2nd respondent of 240,000 equity shares, constituting 96% of the share capital, in the 1st respondent company on 15.03.2010 is challenged by the petitioner, inter alia, on the ground that no board meeting could have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any investment being made by him, and for the purpose only to manipulate resolutions and record it and also with a view to incorporate shell companies thereby to escape liabilities. It is also averred that the bank accounts of the 1st respondent company has been completely wiped out and no accounts or audit have been done for all these years and that when the petitioner tried to establish his rights, he was direly threatened with his life, as well as that of his family consisting of his wife and son, and ultimately unable to bear the injustice the petitioner was forced to lodge a criminal complaint with the state police agency at Goa bearing FIR No.155 of 2011 and also to approach the Company Law Board (Presently NCLT) by way of the above Petition. 11. Primarily based on the above facts, the petitioner has sought for the following reliefs: (1) To set aside and quash the Resolution shown to have been passed in the meeting of the Board of the Directors alleged to have been held on 15.03.2010 allotting 2,40,000 Equity Shares of ₹ 10/- each in favour of the Respondent No.2 under the control of Respondent No.2 and accordingly for rectification of Register of Members. (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Hon'ble Court may deem necessary to relieve the oppressive, harsh and unreasonable conduct of the Respondents on the Petitioner and to relieve the Company from the mismanagement of the Respondents and to stop such acts and conducts of the Respondents which are prejudicial to the interest of the Petitioner in particular and the Company in general. 12. In response to the petition, the 1st to 4th respondents have filed a reply jointly wherein the allegations of the petitioner has been denied outright as cook and bull story'. The respondents deny that the petitioner is entitled to any shares of the 1st respondent company, leave alone the 46.5% of the share capital as claimed by petitioner which it is alleged to have been allotted to him. Further the petition is also being seriously assailed on the point of delay and laches as it is contended that his appointment as a director took place in the year 2007-2008 and hence he cannot maintain the petition on the said count also, in addition to the ground that the petitioner is not a shareholder. The Memorandum of Understandings as claimed by the Petitioner between himself, 2nd respondent and 4th respondent regarding the contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny it is contended by the other respondents that the petitioner being a non-working, non-executive director was not entitled to be in the know of, about day to day affairs of the company, save such information as are required to be provided in the Board Meetings. 14. The allegation of forgery of the petitioner's signature is denied on the ground that the petitioner has not signed any financial statements or statutory records and hence there was no need for his signature in any paper as he was never a working director of the 1st respondent company and in the circumstances fabrication is also ruled out by the respondents as alleged by the petitioner. 15. In relation to development in the properties of the 1st respondent company, it is the contention of the respondents that no development was contemplated during the relevant point, nor was any advance canvassed for obtained towards bookings and hence there was never a question of repayment to the persons alleged to have made bookings. The understanding with a third-party developer of the properties of 1st respondent company is also denied. Further it is also contended by the respondents that since the petitioner was only an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of forgery does not arise. Further in relation to allotment it is contended that on 15.03.2010 the board meeting took place in the morning and that on the same day, 2nd respondent had left in the afternoon, and hence the two signatures are in order and all formalities had been complied with. The allotment was for a bona fide purpose of expansion into real estate and that the respondent 2 had acted keeping in line with his fiduciary duty and in any case the allotments made in March 2010 could not be challenged after considerable delay and laches, that too after 3 years in April 2013, when for the first time the above company petition came up for hearing. 18. In relation to removal of the petitioner from directorship under Section 284 of the 1956 Act it is contended by the respondents that all due compliance with law had been followed and that it is in compliance with Article 5 of the Articles of Association of the 1st respondent company. These respondents have also denied that there are outside liabilities payable by the 1st respondent company. The respondents also contends that delay in finalizing accounts for the years 2007 to 2010, had occasioned due to the fault of the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enforcement authorities, It is also the submission of the petitioner that even his removal has been stage managed with a view to overcome the complaint and as a reaction to it. The petitioner contends that no notice was given of any Board or general meetings including the one on 26.07.2010 allegedly held for his removal and that due process of law including compliance with Section 284 of 1956 Act has not been followed and hence his removal from directorship is not valid. The affidavit of Mr. Narayan Mandrekar is denied and on the other hand the petitioner contends that the statement given by the said Narayan Mandrekar before the police at Goa must be relied for ascertaining the facts. The Memorandum of understanding between the three legal entities is stated by the petitioner to have been entered into, but contends that the memorandum of understandings have been stolen by the respondents under the circumstances as already stated. Annexure XLIX of the reply relating to annual returns for 5 years, it is contended by the petitioner are created records and fabricated as an afterthought. The record has been filed belatedly with the statutory authorities, as a counter blast to the compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay, if in its opinion circumstances exist which make it just and equitable so to do, authorize any member or members of the company to apply to the Tribunal under section 397 or 398, notwithstanding that the requirements of clause (a) or clause (b), as the case may be, of sub-section (1) are not fulfilled. (5) xxxxxxxxxxxxxxx 22. A perusal of the above provision shows that in the case of a company having a share capital, one hundred or more members, or not less than one-tenth of the aggregate number of members whichever is less, or a member or members holding 10% or more of the issued share capital shall have the right to apply under the provisions of Section 397 or 398 of the Companies Act, 1956. A plethora of precedents evolved over a considerable period of time establishes that such holding should be held at the time of filing of the petition. The provisions of Section 399 of the Act are held to be mandatory and not merely procedural. Further, where the petition is sought to be filed on behalf of other shareholders as well who are similarly aggrieved as that of the petitioner then consents of such shareholders are required to be obtained and filed in order t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er mode like inheritance, gift etc. However, no letter of allotment of shares nor share certificates issued by the 1st respondent company or share transfer forms or any transfer/transmission document in relation to 4,65,000 equity shares which is claimed to be held by him has been produced along with the petition in order to establish that he is in fact having title to the said shares. The piece of evidence on which the petitioner is relying to establish his claim over the 4,65,000 equity shares is based primarily upon Form No.2, namely the return of allotment filed with the Registrar of Companies which is seriously disputed by the respondents as not valid and which has been categorized as Management Dispute by the Registrar of Companies, NCT Haryana, New Delhi. In relation to the said Form No.2 and whether it can be made as a basis by the petitioner for claiming the shares of the 1st respondent company the same is dealt with separately elsewhere in this order particularly in light of the absence of any other document being produced, even though alleged to be in existence, to sustain the claim of the petitioner relating to the ownership of 4,65,000 shares in relation to himself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther in relation to allotment of shares nor in relation to the issue of share certificates which necessarily brings to focus the contention of the petitioner about the so-called arrangement between himself and the other respondents in relation to equal participation and management, more so in the absence of any records being produced to fortify the said contention made by the petitioner. The petitioner has conveniently taken a plea that he is precluded from producing the Memorandum of Understanding in relation to the agreement between the parties about equal participation in the shareholding due to the fact that they were stolen under the circumstances narrated in the petition. The loss of documents it is contended by the petitioner took place on 16th March 2010 at Goa Airport under the circumstances stated in the petition which prompted the petitioner to approach the law enforcement authorities on 20th March 2010 about the said loss of documents occasioned due to the same being stolen from him. 26. However, at para v of page 21 of the petition it has been stated by the petitioner as follows:- 'That in the meanwhile, the efforts of compromise took place at the office of M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dence 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 wit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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