Tribunal rules in favor of Petitioner, overturns resolutions, removes directors, appoints independent overseer.

The Tribunal found in favor of the Petitioner, partially allowing the petition due to irregularities and established oppression and mismanagement in the affairs of the Respondent No. 1 Company. The resolutions passed in the board meeting were declared void, and appointments of certain directors were set aside. The Tribunal directed the restoration of the company's original position, removal of certain directors, and appointment of an independent director to oversee compliance with laws and agreements.

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Issues involved:
1. Validity of the notice dated 14.03.2019 for convening the board meeting on 25.03.2019.
2. Validity of resolutions passed in the board meeting dated 25.03.2019.
3. Change in bank account operations without Tribunal's permission.
4. Payment of Rs. 15,84,97,938/- by Respondent No. 2 to the Petitioner.
5. Legitimacy of Respondent No. 5 as a director.
6. Removal of Respondent Nos. 2 to 5 as directors.
7. Appointment of an independent auditor for special audit for FY 2016-17, 2017-18, and 2018-19.
8. Borrowings/facilities without Tribunal's permission.
9. Creation of third-party rights/charge/encumbrance on company's properties without Tribunal's permission.
10. Interim reliefs pending the final disposal of the company petition.

Detailed analysis:

1. Validity of the notice dated 14.03.2019 for convening the board meeting on 25.03.2019:
The Tribunal found that the notice dated 14.03.2019 calling for a board meeting on 25.03.2019 was issued without proper compliance with the agreement dated 11.08.2017. The Petitioner alleged that the Respondent No. 2 had not performed his obligations under the agreement, which included clearing dues and making alternate arrangements for collateral securities. The Tribunal noted that the Petitioner still held 50% of the shares and was entitled to his rights as a shareholder.

2. Validity of resolutions passed in the board meeting dated 25.03.2019:
The Tribunal declared the resolutions passed in the board meeting dated 25.03.2019 as void. It was found that the appointments of Respondents No. 3, 4, and 5 as directors were irregular and not in compliance with the Companies Act, 2013. The resolutions were not backed by proper documentation and were contradictory.

3. Change in bank account operations without Tribunal's permission:
The Tribunal directed that the Respondents shall not change the bank account operations of any of the bank accounts of the Respondent No. 1 Company until an independent director is appointed. This was to ensure compliance with the laws and the agreement between the parties.

4. Payment of Rs. 15,84,97,938/- by Respondent No. 2 to the Petitioner:
The Tribunal did not specifically address this issue in the final order. However, it was noted that the Petitioner had used his personal accruals to clear the CC outstanding and was awaiting reimbursement from Respondent No. 2, who had not complied with the agreement.

5. Legitimacy of Respondent No. 5 as a director:
The Tribunal found that the appointment of Respondent No. 5 as a director was irregular and set it aside. The documents on record showed inconsistencies in the dates and resolutions regarding his appointment.

6. Removal of Respondent Nos. 2 to 5 as directors:
The Tribunal ordered the removal of Respondents No. 3, 4, and 5 as directors of the Respondent No. 1 Company due to irregularities in their appointments. Respondent No. 2 was not removed but was directed to comply with the agreement and cooperate with the independent director.

7. Appointment of an independent auditor for special audit for FY 2016-17, 2017-18, and 2018-19:
The Tribunal did not specifically order the appointment of an independent auditor for a special audit. However, it directed that the financial statements from FY 2016-17 onwards be considered and approved in accordance with the law, with the possibility of revision if necessary.

8. Borrowings/facilities without Tribunal's permission:
The Tribunal directed that the Respondents shall not take any borrowings/facilities without the prior permission of the Tribunal until an independent director is appointed.

9. Creation of third-party rights/charge/encumbrance on company's properties without Tribunal's permission:
The Tribunal directed that the Respondents shall not create any third-party rights, charge, or encumbrance on the properties of the Respondent No. 1 Company until an independent director is appointed.

10. Interim reliefs pending the final disposal of the company petition:
The Tribunal allowed the petition partially and provided interim reliefs by restoring the company to its original position prior to the agreement dated 11.08.2017, declaring certain resolutions and appointments as void, and appointing an independent director to oversee compliance with the laws and the agreement.

Conclusion:
The Tribunal found several irregularities in the procedures adopted by the Respondents and established a case of oppression and mismanagement in the affairs of the Respondent No. 1 Company. The petition was partially allowed, with specific directions to restore the company's original position, remove certain directors, and appoint an independent director to ensure compliance with the laws and the agreement between the parties.

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