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TMI Blog2019 (8) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... trar of Companies to conduct enquiry into the affairs of Respondent No. 1. After considering the pleadings of the parties and arguments advanced on their behalf the Tribunal found that the Appellant had agreed for the transfer of firm to Respondent No. 1 and since he was only entitled to 100 shares based upon the value of the assets and liabilities of the transferor firm, allotment of 100 shares in his favour did not constitute an act of oppression or mismanagement. The Tribunal was of the further view that there was no act of oppression or mismanagement that led to the diminishing of shares of the Appellant in the Respondent No. 1. It also held that the Appellant was not single handedly eligible to file the petition under Section 241 of the Act when the number of members was twelve and the shareholding of Appellant was less than 10 percent. The petition filed by Appellant came to be dismissed at the hands of the Tribunal in terms of order dated 3rd July, 2018 which has been impugned in this appeal on various grounds to which we shall advert to in the forthcoming paras. 2. A brief resume of the factual matrix is inevitable. The genesis of business relationship between the father ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed the record. Resolution dated 24th November, 2014 passed in regard to takeover of the firm by the Respondent No. 1 Company, though claimed by the Appellant at his back and not bearing his signatures was admittedly followed by a 'Takeover Agreement' dated 26th December, 2014 between the firm and Respondent No. 1 Company by virtue whereof the firm was dissolved. Though the Appellant termed the resolution dated 24th November, 2014 as being fraudulent in respect whereof an FIR was lodged alleging cheating and forgery, the 'Takeover Agreement' following the resolution has not been assailed. The Tribunal, after thorough examination of all relevant considerations arrived at the conclusion that the Appellant had agreed for the transfer of business of the firm to Respondent No. 1 Company. This finding is not shown to be erroneous, much less perverse. During the course of hearing learned counsel for Appellant frankly conceded that he was not assailing the 'Takeover Agreement'. In view of this development, we do not propose to pronounce upon the factum and validity of the 'Takeover Agreement', which led to dissolution of the firm and incorporation of Respondent No. 1 Company. Thus the sole ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rising for consideration in regard to allotment of shares in Respondent No. 1 Company would be whether the book value of the assets and liabilities of the firm or the sharing of profit/ loss ratio as per the Partnership Deed would be the relevant consideration. 5. It is not in controversy that the Takeover Agreement stipulated its main object behind takeover for developing the business of the transferor firm drawing the business of transferor firm under the umbrella of a private limited company. As per Terms of Agreement book value of Rs. 10 each i.e. 11,00,000 equity shares were to be allotted to the partners of the firm in proportion to their capital balance in the firm. Since, the Appellant held only 0.01% of the capital ratio he was allotted only 100 shares in Respondent No. 1 Company. Ex-facie this allocation of shares is based on the capital balance ratio as stipulated in the Takeover Agreement. It is indisputable that the capital ratio is the basis for the allocation of the equity shares in the Respondent No. 1 Company. According to Appellant there is nothing on record to show the Appellant had contributed only 0.01% of the capital to the firm. This is countered by the Resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal asset to a company in the course of demutualisation or corporatisation of a recognised stock exchange in India as a result of which an association of persons or body of individuals is succeeded by such company : Provided that- (a) all the assets and liabilities of the firm or of the association of persons or body of individuals relating to the business immediately before the succession become the assets and liabilities of the company; (b) all the partners of the firm immediately before the succession become the shareholders of the company in the same proportion in which their capital accounts stood in the books of the firm on the date of the succession; (c) the partners of the firm do not receive any consideration or benefit, directly or indirectly, in any form or manner, other than by way of allotment of shares in the company; and (d) the aggregate of the shareholding in the company of the partners of the firm is not less than fifty per cent of the total voting power in the company and their shareholding continues to be as such for a period of five years from the date of the succession; (e) the demutualisation or corporatisation of a recognised stock exchange ..... 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