9911796707
TMI Blog2020 (10) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... nt No. 1 Company. 2. This case is about the astute Respondent Nos. 2-6 & 8 (Majority shareholders of the Respondent No. 1 Company) who have abused their position in Respondent No. 1 to perpetrate fraud over the years in Respondent No. 1 Company. The Minority Shareholders raised objections in relation to the bad corporate governance practices that were followed in Respondent No. 1, the Respondents No. 2-8 (Executive Management of Respondent No. 1 Company) has, not once, taken such objections on the record. The mismanagement of the affairs of the Respondent No. 1 Company by the Respondent Nos.2-8 are enumerated in detail in CP/02(KOB)/2020. 3. On 17.02.2020 this Tribunal appointed an Advocate Commissioner to authenticate the statutory recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. Later on, learned Counsel for the Respondent Company informed that the company has taken a decision to shut down their registered office in Calicut "until further notice" on account of 'Covid 19', but the Advocate Commissioner proceeded to the registered office and he was informed that the office has been closed for an indefinite period on account of 'Covid-19'. Concluding his report, he stated that "the Respondent Company (through their Counsel) deliberately mislead me regarding the closure of the registered office only to obstruct the authentication proceedings." 7. Learned counsel for the petitioners submitted that due to the advisory and national lockdown protocols put in place by the Central Government on account o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... complete the auditing work. Learned Senior counsel also prayed for appointment of forensic auditor enumerated in the interim relief mentioned by the petitioners in their prayer No. (xiv) in the Company Petition. 11. The interim counter filed by the Respondents against the granting of interim relief No. (xiv) through mail controverted and contested the IA, inter alia stating that the Advocate Commissioner report was exaggerated, manipulated and motivated. The respondents requested the Advocate Commissioner for postponement of the exercise only due to Corona Virus pandemic since no individual can be compelled to take the risk and do an exercise, which if postponed would not cause any irreparable damage than that Covide-19 have caused. The Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and Conciliation Act, 1996 of the said Act is of such nature that if it is allowed the matters in the Company Petition will not remain before this Tribunal for adjudication, it is necessary that the same is heard first. It is only if the same is not allowed, the Respondents will submit their counter for the matters to be heard on merits. 15. It is further stated that there is nothing in the allegations4 raised by the petitioners that pertain to anything other than that which are disclosed in the audited financial statements which are already approved by the board and adopted by the members and filed with the Registrar of Companies. Further there is nothing in the allegations which have happened in the immediate period before the filing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt, this Bench is of the view that the petition was filed under Section 241 and 242 of Companies Act and the reliefs sought for can only be available under the same sections of the Companies Act and cannot be granted under Arbitration and Conciliation Act. Accordingly, this Tribunal pass the following order. I. While considering the present situation to meet the ends of justice, this Tribunal allows the appointment of an Independent Forensic Auditor to complete the auditing work within 60 days from the date of appointment of the auditor by this Bench. II. It is also directed to constitute an audit committee consisting of two directors from the Petitioner's side and two from the Respondent's side other than Respondent No. 2 for hel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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