9911796707
TMI Blog2014 (4) TMI 1198X X X X Extracts X X X X X X X X Extracts X X X X ..... ade in Company Application No.258 of 2012, in C.P.No.153 of 2010. 2. The facts in brief are as follows: 2.1) The second respondent and his four brothers are holding the entire shares of the first respondent company. The second respondent, being the elder brother, was the managing director. The other four brothers are directors of the first respondent company. While so, disputes had arisen between the second respondent and his brothers, relating to the management of the affairs of the first respondent company, which is carrying on the business of manufacturing and trading in textiles and in the export of fabrics. 2.2) In order to settle the disputes, amicably, the second respondent and his four brothers had entered into a family agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plemented, the second applicant in the company application, in Company application No.258 of 2012, the second respondent in the present appeal, had been removed from the post of managing director, on 16.5.2011. 2.6) Even though the second respondent herein had filed a company petition, in C.P.No.57 of 2011, on the file of the Company Law Board, complaining of oppression and mismanagement, in terms of Sections 397 and 398 of the Companies Act, 1956, no interim order had been issued to stall the process. Thus, the second respondent had been removed from the directorship, based on the resolution of the extraordinary general meeting, held on 5.8.2011. While so, the brothers of the second respondent had filed an application, in Company Applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant company to the second respondent s wife, in consideration of 2,50,000 shares held by her in the first respondent company. In effect, the respondents had sought the allotment of shares, as per the scheme sanctioned by the order passed by this court, dated 8.4.2011, in C.P.Nos.153 and 154 of 2010. 3. A counter affidavit had been filed on behalf of the appellant company raising the issue of maintainability of the application and opposing the granting of the relief sought therein. The learned single Judge had found that the following issues had arisen for the consideration of this court: "11. The Managing Director of the respondent filed a detailed counter affidavit, objecting to the very main ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I must also point out here that by removing the second applicant from the post of Managing Director and later from the very Directorship of the company, the respondent and the other brothers have virtually taken control of the company. Today, they cannot talk about the inventories or about packing credit. This is one more reason as to why the objections to the audit report cannot be sustained. 28. In view of the above, the application is allowed as prayed for. The respondent is given a time limit of four weeks to effect allotment of shares. Till it is done, the resolutions removing the second applicant from the Directorship and Managing Directorship cannot be given effect to. The Chartered Accountants appointed by this court shall be pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the said application. The learned single Judge had failed to note that the appellant had discharged a substantial portion of the liabilities, which should have been discharged by the second respondent, as per the sanctioned Scheme of Demerger. Further, the conclusions arrived at by the chartered accountants appointed by the court that the second respondent had fulfilled his obligations, to a substantial extent, is disputed. It had also been submitted that the second respondent had not fulfilled his part of the obligations, as per the approved Scheme of Demerger. While so, the appellant cannot be compelled to effect allotment of shares, as directed by the learned single Judge. 8. It had been further submitted that the learned single Jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spirit of the sanctioned Scheme of Demerger. It could not be possible for the second respondent to fulfill all his obligations, unless he is permitted to continue in the post of managing director of the first respondent company and by being a director of the said company for implementing the sanctioned Scheme of Demerger, in full measure. In spite of the second respondent fulfilling his obligations to the extent possible, the appellant has been employing delaying tactics in order to scuttle the implementation of the Scheme of Demerger with mala fide motives. Therefore, the present appeal filed by the appellant is liable to be dismissed, as it is devoid of merits. 11. In view of the submissions made by the learned counsels appearing for th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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