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TMI Blog2021 (1) TMI 766X X X X Extracts X X X X X X X X Extracts X X X X ..... im order which it thinks fit for regulating the conduct of the company s affairs upon such terms and conditions as appear to it to be just and equitable. Since, there were numerous allegations made under the Company Petition it was needed to be verified and no order could be passed abruptly until the allegations and grievances are examined completely. The Special Officer being an officer appointed by the Tribunal was given the power under the impugned order to supervise, conduct and preside over the Board meetings and ensuring the implementation of the resolutions passed in the said Board meetings. The Special Officer was ordered to ensure that such resolutions shall not be prejudicial to the interest of Respondent No. 1 Company so that frivolous litigations may be avoided and for this Special Officer was asked to make the complete Minutes of the meetings and get it signed by all the participants mandatorily. The Special officer was asked to submit its report within 60 days from the date of taking the charge. Therefore, the contention on behalf of the Appellant that the report of Special Officer will further escalate the issues among the parties is a matter of speculation and ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e passing the impugned order have made the following observations in para 44, 45 and 46 of the impugned order dated 01.10.2019. 44. From the facts narrated above, it is apparent that the management/ owners are divided and have got grievances against each other. It is also observed that there are allegations of the formation of independent companies by petitioners as well as respondents no. 5 6 which is aimed at enriching themselves by diverting the business of respondent no. 1 company. There have been allegations of other acts by petitioners as well as respondent no. 5 6 regarding preferential/ undervalued transections being prejudicial to the cause and the interest of the respondent no. 1 company. The erstwhile company law board and this Tribunal have taken note of these facts and passed aforesaid interim orders which also to have been alleged as non-compliant partially or fully. 45. Further, there have been adduced various documents from all parties to the dispute. The fact remains that these documents require an in depth and physical inspection/ verifications on the ground. The turn-over of respondent no. 1 company is also gradually decreasing along with the profi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the connected persons for carrying on the business of transportation. As per the Annual Return filed for the Financial Year 2013-14, the shareholding of the Respondent No. 1 Company was as under: S. No. Name of the Shareholder Percentage of Shareholding 1. Yogendra Pal Jain (Respondent No. 2) 3.51% 2. Usha Kiran Jain (Respondent No. 3) 16.49% 3. Ravinder Kumar Gupta (Respondent No. 5) 11.52% 4. Tanmay Gupta (Respondent No. 6) 4.99% 5. Veena Gupta (Respondent No. 7) 23.50% 6. Arun Gupta (Appellant no. 1 ) 2.14% 7. Savita Gupta (Appellant No. 2) 31.79% 4. That the Appellant No. 1 and Respondent No. 5 are the real brothers. The Respondent No. 2 is the brother in law of the Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legations and grievances among the parties to the petition. The Appellant being aggrieved by the order of the NCLT have preferred the present appeal. Submissions on behalf of the Appellants 9. The learned counsel for the Appellants submitted that earlier the Appellants had certain issues with the Respondent No. 5 and 6 due to them to release their personal guarantees and certain other acts due to which the Appellants had filled the C.P. No. 176 of 2015 filed under section 397 and 398 of the Companies Act, 1956 before the Company Law Board (CLB) against Respondent No. 5 and 6. However, due to the settlement arrived between the Appellants and the Respondent No. 5 and 6, the said petition was withdrawn by filling CA No. 227 of 2016, vide order dated 11.04.2016 passed by NCLT. 10. It is further submitted by the learned counsel on behalf of the Appellants that in the said Company Petition the Respondent No. 1 has taken the plea that the correct shareholding pattern of the Respondent No. 1 Company is that Ravinder Kumar Gupta Group (Respondent No. 5 and Respondent No. 6) hold 40%; Appellants (Appellant No. 1 and Appellant No. 2) holds 40% and Yogendra Pal Jain Group (YPG) (Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal, shall record the reasons for not disposing of the application or petition or the appeal, as the case may be, within the period so specified; and the President or the Chairperson, as the case may be, may, after taking into account the reasons so recorded, extend the period referred to in subsection (1) by such period not exceeding ninety days as he may consider necessary. 14. It is further contended by the Appellants that the NCLT has interregnum of the proceedings, appointed the Special Officer Sh. D.C. Aggarwal, Advocate for carrying out the certain functions to preside over the meetings of the Board of Directors of the Respondent No. 1 Company. The Special Officer has been asked to produce his report within 60 days from the date of assumption of charges as Special Officer. The NCLT has failed to consider that by doing such exercise, it is defeating the purpose of section 422 of the Companies Act, 2013, which mandates the requirement of disposal of the petition within the prescribed period of 3 months. The entire time will be spent on carrying out such exercise by the Special Officer when the said Company Petition would be disposed of by NCLT. It is matter of record tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Submissions on behalf of the Respondent No. 2 17. It was submitted by the Respondent No. 2 that the Appellant No. 1 clandestinely formed a new company by the name M/s Care Go Logistics Pvt. Ltd. (Respondent No. 9). Appellant No. 2 and Mr. Archit Gupta (son of Appellant No. 1 2) were shown as major shareholders and Directors of this newly formed company. Appellant No. 1 then started diverting the staff of customers of Respondent No. 1 Company to this newly formed company. Due to this circumstances the Respondent No. 1 Company issued notice for holding an Extraordinary General Meeting (EGM) for removing the Appellant No. 1 as Director. However the Appellants filled an application under section 397/398 of Companies Act, 1956 before the CLB for staying the proceedings of EGM. 18. It was further submitted by the learned counsel for Respondent No. 2 that the Appellants and Respondent No. 5 group entered into amicable arrangements by virtue of which appellants withdrew their petition. Thereafter, Appellant No. 1 group alongwith Respondent No. 5 group issued a notice holding an EGM for removing Respondent No. 2 and Respondent No. 3 from the Directorship of Respondent No. 1 Compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to huge financial losses to Respondent No. 1 Company and which can be easily reflected from its financial accounts, wherein the turnover of the Company has drastically dropped from ₹ 222 crores as on 31.03.2015 to approximately ₹ 9 crores as on 31.03.2018. Interestingly, the turnover of Respondent No. 9 company floated by Appellant No. 2 and her son in or around April 2015, went up to ₹ 93.90 crores in the Financial Year, 2017-18. This clearly shows the shifting of business from Respondent No. 1 Company to Respondent No. 9 by the Appellants. 22. It was also stated by the learned counsel for the Respondent No. 2 that the Appellant No. 1 and his son broke away the cabins of Respondent No. 1 Company which were under the possession of Respondent No. 2 3 for which necessary FIR was filed against Appellant No. 1 his son on 21.06.2017 bearing FIR number 0531 at police station at Civil Lines, Gurgaon. 23. It was also stated on behalf of Respondent No. 2 that Appellant No. 1 by misusing his powers as Director and trustee of Gratuity fund maintained by Life Insurance Corporation fraudulently withdrew the Gratuity amounts of Respondent No. 2 3 amounting to approx. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs for conducting investigation into the affairs of the company and to report the same to Board of Directors. 27. It was contended by the learned counsel for the Respondent No. 2 that it is clear the NCLT, Kolkata after taking into consideration the admitted disputes between the parties, had passed such an order to protect and preserve the assets of the company, It is an admitted fact that the Appellants along with Respondent No. 5 group have divided the company for their own beneficial interest behind the back of Respondent No. 2 so far as the shareholding of Respondent No. 1 is concerned it was clear that the shareholding pattern shall be equal within the three groups as stated above. The financial mismanagement is evident from its financial statements. The Company Secretary of Respondent No. 1 has also blamed the Appellant No. 1 for conducting mismanagement of Respondent No. 1. 28. The learned counsel for the Respondent No. 2 further contended that in the interest of the answering Respondent that the prayers of the main petition as stated above should be considered in order to stop the Appellants from further carrying out any form of Oppression and Mismanagement and in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sided by such Special Officer. 31. The contentions of the Appellants that NCLT, have exceeded its jurisdiction by appointing a Special Officer has been taken down as Section 242(4) have given general power to the NCLT to make any interim order which it thinks fit for regulating the conduct of the company s affairs upon such terms and conditions as appear to it to be just and equitable. Since, there were numerous allegations made under the Company Petition it was needed to be verified and no order could be passed abruptly until the allegations and grievances are examined completely. 32. The Special Officer being an officer appointed by the Tribunal was given the power under the impugned order to supervise, conduct and preside over the Board meetings and ensuring the implementation of the resolutions passed in the said Board meetings. The Special Officer was ordered to ensure that such resolutions shall not be prejudicial to the interest of Respondent No. 1 Company so that frivolous litigations may be avoided and for this Special Officer was asked to make the complete Minutes of the meetings and get it signed by all the participants mandatorily. The Special officer was asked to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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