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TMI Blog2020 (7) TMI 535X X X X Extracts X X X X X X X X Extracts X X X X ..... equitable ground. The allotment of shares has been done without getting it approved in any Board Meeting - In the absence of any record available to be produced by either of the parties and non-existence of the assets of the company, it will be futile exercise to make any order except winding up of the company in the circumstances. The NCLT has passed a speaking and well reasoned order and there is no merit in the appeals to interfere with the impugned order. The impugned order is upheld - appeal dismissed. - Company Appeal (AT) No. 380/2018 And Company Appeal (AT) No.23/2019 - - - Dated:- 22-1-2020 - Justice Jarat Kumar Jain Member(Judicial), Mr. Balvinder Singh Member (Technical), Dr. Ashok Kumar Mishra Member (Technical) For the Appellant : Mr Karan Luthra and Niyati Kohli, Advocates., Mr Ankur, Proxy counsel For the Respondents : Mr.Ankur, Proxy counsel, Mr. PS Singh, Advocate, Sr. Panel counsel for ROC., Mr. Karan Luthra and Mr. Niyati Kohli, Advocates, Mr PS Singh, Advocate JUDGEMENT MR. BALVINDER SINGH, MEMBER (TECHNICAL) This appeal has been preferred by the appellant under Section 421 of the Companies Act, 2013 against the order dated 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otted with the consent of Respondent No.2. Form No.2 filed with the ROC for the allotment of equity shares on these dates was digitally signed by Respondent No.2 alongwith the Chartered Accountant of Respondent No1 company. 8. Learned counsel for the Respondent argued that the shares were allotted by the appellants illegally, therefore, the allotment of shares be set aside. Learned counsel argued that the appellant in connivance with the Chartered Accountant allotted shares to his own HUF and even to his wife and friends in order to fraudulently increase his share holdings in the company. The said allotment was without any corresponding authorization by the Board of Director and/or without Respondent s consent as per Articles of Association of the company. 9. We find that no Board Resolution has been placed before the NCLT or before this Appellate Tribunal to establish that the shares were allotted as per law and the Respondent No.2 has also contradicted that the allotment were made with his consent. The appellant has himself admitted in C.P.No.47/2008 that no board meetings were held in SBF and that no board meeting was held for the allotment of shares. Further the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this ground? b) Whether R2 illegally issued 3,66,750 equity shares of R1 in violation of the provisions of the Companies Act, 2013 and behind the back of the PG to himself, to his HUF, wife and other friends and business associates? c) Whether R2 and R3 have misused the digital signature of the PG for illegally allotting the above shares? d) Whether allotment of shares alleged to be made by R2 were in violation of the terms imposed by Canara Bank in its term loan? e) Whether R2 siphoned off money from R1 s bank account? f) Whether R2 replaced his Gurgaon property mortgaged with Canara Bank with property of BSL Buildcon for which the PG also paid ₹ 15 lac? g) Whether the PG has siphoned off sums of R1? h) Whether the PG has manipulated the books of accounts, financial statements and other records of R1? i) Whether the enhancement of the cash credit limit from ₹ 85 lacs to 200 lacs by Canara Bank in favour of R1 was in violation of specified procedure? The appellant submitted that both the petitions were dismissed summarily, while deciding only one issue under the cover of Equity. 14. The appellant submitted that once the Tribunal has framed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated that the Respondent No.2 has filed affidavit before the Police Authorities wherein he has falsely stated on oath that all transactions and dealings of the company are illegal and unlawful and that the appellant has been opening various bank accounts by fabricating board resolutions without any substance. 21. The appellant submitted that the Respondent No.2 did not cooperate with the Auditors and Administrator. 22. On the other hand Respondent No.2 submitted that appellant failed to abide by the orders of the Hon ble NCLT, Hon ble High Court and Learned Arbitrator with regard to directions to produce the books of accounts and records of Respondent No.1 company. 23. Respondent No.2 submitted that the appellant has avoided furnishing the documents of the Respondent No.1 company and then claimed that the documents were accidently destroyed and thereafter failed to reconstruct the same. 24. Respondent No.2 submitted that the appellant was in exclusive control of the Respondent No.1 company since the year 2008 and the appellant is responsible for the state of affairs of the Respondent NO.1 company. 25. Respondent No.2 submitted that the appellant did not cooperate w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur, We also note that the Hon ble High Court of Delhi vide its orders dated 11.3.2016 (Page 545) has ordered to initiate suo moto proceedings for contempt against the appellant for disobeying the order of Hon ble High Court and Company Law Board. On these basis we find that the conduct of the Respondent No.2 is not upto the mark and he has siphoned off the assets of Respondent No.1 company. 32. Section 242(1)(b) provides as under: (b) that to wind up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the making of a winding up order on the ground that it was just and equitable that the company should be wound up. the Tribunal may, with a view to brining to an end the matters complained of, make such order as it thinks fit. 33. It is apparent that there is dispute between the two directors regarding their shareholding of the company. Whenever any one of the director has been in control of the company admittedly before 2008 by Lalit Agarwal and after 2008 by Pramod Goil, both of them have taken action in such a manner that the company has been mismanaged to the extent that it has lost its substratum. Once the compa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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