Tribunal sets aside appointment, declares share capital increase null, restores petitioner as Director.

The tribunal allowed the petition, setting aside the appointment of Respondent No.3 as Director, declaring the increase in share capital as null and void, and restoring the petitioner as Director. The tribunal also declared Form-32 dated 29.12.2010 filed before the Registrar of Companies as null and void. No costs were awarded.

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Issues Involved:
1. Appointment of Respondent No.3 as Director.
2. Increase in Share Capital.
3. Removal of the Petitioner as Director.
4. Allegations against Respondent No.4 (Auditor).

Issue-wise Detailed Analysis:

1. Appointment of Respondent No.3 as Director:
The petitioner contended that the appointment of Respondent No.3 as Director was done behind his back and without his consent. He alleged that there was no Board meeting on 24.08.2010, and the proceedings were fabricated. The tribunal found that there was no proof of a Board meeting on 24.08.2010, and the E-mail correspondences did not disclose the appointment of Respondent No.3. The tribunal concluded that the appointment of Respondent No.3 was concocted and created, and thus, the appointment was set aside as null and void.

2. Increase in Share Capital:
The petitioner argued that the increase in share capital was done without his knowledge and behind his back, violating the Articles of Association. The tribunal noted that there was no proof of any Board meeting or EGM held on 07.12.2010 and 29.12.2010, respectively. The respondents failed to prove the need for increasing the share capital and did not follow the prescribed procedure in Article 5 of the Articles of Association. The tribunal declared the enhancement of share capital by issuing 90,000 shares and allotting them between Respondents No.2 and 3 as illegal, null, and void.

3. Removal of the Petitioner as Director:
The petitioner contended that his removal as Director was done without following the due process and was based on fabricated documents. The tribunal found that no notice was given to the petitioner under Section 190 of the Companies Act, 1956, and no opportunity was provided for him to be heard. The tribunal noted that the removal was against Article 16 of the Articles of Association, which provided that the first Director shall continue to hold office until they vacate voluntarily or are disqualified by law. The tribunal set aside the removal of the petitioner as Director and restored him to his position.

4. Allegations against Respondent No.4 (Auditor):
The petitioner alleged that Respondent No.4 colluded with Respondent No.2 and misused his digital signature. Respondent No.4 denied these allegations, stating that he acted on the consent given by the petitioner for filing documents with the Registrar of Companies. The tribunal found that the petitioner failed to substantiate his allegations against Respondent No.4, and thus, no adverse findings were made against Respondent No.4.

Conclusion:
The tribunal allowed the petition, setting aside the appointment of Respondent No.3 as Director, declaring the increase in share capital as null and void, and restoring the petitioner as Director. The tribunal also declared Form-32 dated 29.12.2010 filed before the Registrar of Companies as null and void. No costs were awarded.

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