Tribunal nullifies share allotment, orders corrections in Register of Members within 30 days.

The Tribunal allowed the appeal, setting aside the Impugned Order and declaring the share allotment to R-3 and R-4 as null and void. Corrections in the Register of Members of R-1 Company were directed within thirty days, with the appeal being allowed without any order as to costs. The Appellant's petition CP No. 09/2016 was not affected by res judicata and estoppel, and the issue of delay and laches was dismissed. Additionally, the share allotment to R-3 and R-4 was found to violate the Articles of Association, leading to its nullification.

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Issues Involved:
1. Res judicata and estoppel concerning the Appellant's knowledge and acknowledgment of share allotment.
2. Delay and laches in filing the petition CP No. 09/2016.
3. Violation of Articles of Association in the allotment of shares to R-3 and R-4.

Summary:

Issue 1: Res judicata and Estoppel
The Appellant was a co-petitioner in CP No. 59/2014, where she acknowledged the share allotment to R-3 and R-4. However, the Appellant sought liberty to file a fresh petition when withdrawing from CP No. 59/2014. Despite her participation in the AGM and acknowledgment of shareholding changes, she did not have specific knowledge of her reduced shareholding. The Tribunal concluded that the Appellant's petition CP No. 09/2016 is not affected by res judicata and estoppel, allowing her to file the company petition.

Issue 2: Delay and Laches
The Appellant's shareholding was reduced from 28% to 8.64% due to the share allotment to R-3 and R-4, constituting a continuous act of oppression. The Tribunal relied on the judgment of the Hon'ble Delhi High Court in Surinder Singh Bindra v. Hindustan Fasteners (P) Ltd., which supports the notion that continuous acts of oppression can be challenged irrespective of the time elapsed. Thus, the company petition CP No. 09/2016 does not suffer from delay and laches.

Issue 3: Violation of Articles of Association
Clause 5 of the Articles of Association mandates that new shares be offered to existing shareholders first. There was no evidence that such an offer was made to the existing shareholders before allotting shares to R-3 and R-4. The Tribunal referenced multiple judgments, including Claude-Lila Parulekar v. Sakal Papers (P) Ltd. & Ors., which emphasize the binding nature of the Articles of Association and the fiduciary duty of directors. The Tribunal found that the share allotment to R-3 and R-4 violated the Articles of Association and was therefore null and void.

Conclusion:
The Tribunal set aside the Impugned Order, declared the allotment of shares to R-3 and R-4 as null and void, and directed corrections in the Register of Members of R-1 Company within thirty days. The appeal was allowed without any order as to costs.

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