Requisitioned extraordinary general meeting rights prevail where statutory requirements are met; interim restraint on valid resolutions was unsustainable.

A requisitioning shareholder who satisfies the statutory shareholding and procedural requirements may call and hold an extraordinary general meeting if the board fails to do so, and resolutions passed at that meeting are validly acted upon. The shareholder agreement and articles of association also supported the relevant corporate rights. An interim injunction restraining implementation of such resolutions is not ordinarily available unless there is a prima facie finding that acting on them would prejudice the public interest or the company at large; no such finding was recorded, so the restraint was unsustainable. The appeal succeeded and the injunction was set aside.

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Issues: (i) Whether a requisitioning shareholder, holding the requisite shareholding and complying with the statutory requirements, was entitled to call and hold an extraordinary general meeting and act upon the resolutions passed therein. (ii) Whether an interim injunction could be granted restraining the company from giving effect to the resolutions passed at the requisitioned extraordinary general meeting.

Issue (i): Whether a requisitioning shareholder, holding the requisite shareholding and complying with the statutory requirements, was entitled to call and hold an extraordinary general meeting and act upon the resolutions passed therein.

Analysis: The statutory scheme permits the board to call an extraordinary general meeting and, on failure of the board to do so after a valid requisition, permits the requisitionists themselves to call and hold the meeting within the prescribed time. The requisitionist in the present case held the requisite shareholding and followed the prescribed procedure for convening the meeting. The shareholder agreement and the articles of association also supported the relevant rights relating to board representation and corporate action. Accordingly, the convening and holding of the meeting was in accordance with law.

Conclusion: The shareholder was entitled to call and hold the extraordinary general meeting, and the resolutions passed therein were not liable to be treated as invalid on that ground.

Issue (ii): Whether an interim injunction could be granted restraining the company from giving effect to the resolutions passed at the requisitioned extraordinary general meeting.

Analysis: A validly convened general meeting and the resolutions passed thereat cannot ordinarily be interdicted by injunction. Judicial interference at the interlocutory stage requires a prima facie finding that implementation of the resolutions would be prejudicial to public interest or to the company at large. No such finding was recorded by the Tribunal below; instead, the restraint was based largely on pending parallel proceedings. The impugned restraint therefore exceeded the permissible limits of interim intervention.

Conclusion: The interim injunction against acting upon or giving effect to the resolutions passed at the extraordinary general meeting was unsustainable.

Final Conclusion: The appeal succeeded, the restraint order was set aside, and the matter was left to proceed before the Tribunal below in accordance with law.

Ratio Decidendi: A requisitionist shareholder who satisfies the statutory requirements for calling an extraordinary general meeting cannot be restrained from holding the meeting or from implementing validly passed resolutions unless a prima facie case is made out that such action would be prejudicial to the public interest or the company at large.

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