TaxTMI 
TaxTMI 
TaxTMI 
2017 (3) TMI 1007
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..... (2) A copy of every balance sheet of the company placed before the Board of the Company for approval before signing and submission of the same to the auditors for their report thereon as the aforesaid Petitioner No. l and Petitioner No. 2 have not received the same from the company till date. (3) Details of all payments made (including any remuneration, fees, benefits and perquisites) to any of the directors on the Board of the Company by the Company till date be made available to Petitioner No. 1 and Petitioner No. 2. (4) Details of all payments made by the company as or by way of managerial remuneration including fees, benefits and perquisites till date be made available to Petitioner No. 1 and Petitioner No. 2. (5) Details of all payments made to any of the Directors on the Board of the company till date by any other company, body corporate, firm or person in accordance with the companies Act, 1956 be made available to Petitioner No. 1 and Petitioner No. 2. (6) Copies of all agreements, contracts and other similar arrangements entered into or proposed to be entered into by the company and placed before the Board or liable to be placed before the Board at any meeting or th....
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....and every other document required by law to be annexed or attached, as the case may be, to the balance sheet) be provided to each Petitioner in accordance with the provisions of the Companies Act, 1956. (13) Copies of Notice, Agenda and Minutes (including all corresponding agenda papers, related documents, annexures, enclosures, drafts, statements, notes and attachments) in respect of all Extraordinary General Meetings the company convened on and after June 26, 2008 be provided to each Petitioner in accordance with the provisions of the Companies Act, 1956. (14) Details of all quotations, price lists and bids or tenders received by the company from all suppliers/vendors of services or products and the basis on which decision for procuring the same from such suppliers was taken by Respondent Nos. 2 to 7 be provided to Petitioner No. 1. (15) Petitioner No. l be allowed to enter the office premises and given full access to the statutory records, registers and financial records of the respondent No. 1 Company and also provided copies of such records and documents. (16) Respondents be directed to pay appropriate moneys as and by way of dividends to the Petitioners as monies have bee....
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....ompany offered a joint business proposal to M/s. Nasik City Cable Network Pvt. Ltd. and proposed to acquire 51% equity share in the paid-up share capital of Nasik City Cable Network Pvt. Ltd. Accordingly Share Subscription, Share Purchase, and Share Holders Agreement (SPA) dated 26th June 2008 was entered in between Nasik City Cable Network Pvt. Ltd. and Respondent No. 2 company. As per clause 2.5 of Article 2 of SPA the name of Nasik City Cable Network Pvt. Ltd. was changed to Den Nasik City Cable Network Pvt. Ltd.(Respondent No. l) with 51% share in favour of Respondent No. 2 company and 49% shareholding with earlier 47 shareholders. The total number of shareholders of Den Nasik City Cable Network Pvt. Ltd. became 48. After coming into effect of the same SPA, the shareholding of the 10 petitioners in Respondent No. l company became 14.22%. Petitioner Nos. l & 2 were directors in Respondent No. l company. Petitioner No. 2 resigned as a director of Respondent No. l company with effect from 10th May 2010. Respondent Nos. 3 to 7 are directors of Respondent No. l company and Respondent No. 8 is the auditor of the said company. Respondent No. 9 is a company named M/s. Den Discovery Dig....
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....urchase Agreement. It is also the case of the Petitioners that no notice either physically or orally was ever served on them by Respondent No. l company for the purported EOGM. It is also submitted that the minutes of the EOGM dated 16.03.2013 contains the signature of Respondent No. 5 alone, and not countersigned by any of the shareholders attending the said EOGM and therefore the EOGM is fabricated and null and void. The Petitioners further allege that in the EOGM the shareholders were misguided that they would be required to invest approximately 40.52 crores for digitalization of cable network, when in fact, the digitalization work was already in existence. The petitioners have also contended that as per Article 8 of the SPA all investments on digital headend are to be born exclusively by R2, and other investments except digital headend should have been shared proportionately as per the shareholding of shareholders. 5.1) The Petitioners have also challenged the resolution passed in the recent EOGM dated 15.02.2016, mainly on the ground that the investment plan for Rs. 19 crore as stated in the alleged notice dated 08.02.2016 has not been given. 5.2) It is the case of the Respo....
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....he order dated 23.12.2015 was challenged before Hon'ble Bombay High Court, wherein with the consent of the parties the following order was passed on 04.02.2016: "(i) Respondent No. 1 Company could hold EOGM after giving due notice to all the shareholders. (ii) If any resolution was passed in the EOGM the Company would not act upon the same until further orders from the Hon'ble Board. (iii) The Petition may be heard expeditiously subject to the convenience of the Hon'ble Board." In compliance of the High Court order, the Respondent No. 1 company again issued notice, including public notice in Newspapers, to all its shareholders informing them about the EOGM to be held on 15.02.2016 to discuss and pass necessary resolution in respect of future business plan for implementation of digitalization of cable net-work in phase-3 as per the policy of the Government. In addition, emails dated 09.02.2016 in this regard were sent to the Petitioners. Nevertheless except Mrs. Smita Gurudatt Kasture (Petitioner No. 12), all other petitioners again failed to participate in the EOGM held on 15.02.2016 nor executed requisite proxy forms for their representation. 5.5) There is no dis....
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....ompany would not participate in digitalization and would continue to carry on business in analogue mode. 5.8) It is seen that the majority shareholders consistently long since 2013 have decided not to participate in the digitalization. The Court does not have the expertise to overturn the commercial decision consistently taken with open eyes by the majority shareholders. Business decisions taken consistently should not normally be interfered with. Petitioners neither participated nor were involved in the business decision of Respondent No. 1 company. They have not placed any plan/scheme on record with regard to carrying out business in digitalization, except remaining dormant in the affairs of the company. As per Government policy the process of applying and phase-wise shifting to digitalization are to be completed by end of March 2017. It is the shareholders who should decide and explore plans to carry on a particular business or not. Court cannot interfere in the business decision and therefore, ought not to compel them against their wish to carry on business in digital mode more so at this belated stage. 5.9) It is pertinent to note that Clause 8.1 of Article 8 of the Share Pu....
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....elevant time, both digital and analogue systems were in place simultaneously and Set Top Boxes were provided voluntarily to the subscribers for the purpose of offering them better clarity and benefit of viewing additional channels. However, the cost involved in digitalization as per Government notification includes majorly the price payable for acquisition of STB(s), digital equipments, upgradation of existing equipments and laying of cables, setting up of toll free call center, subscriber management system etc. It is contended that for shifting to digitilation additional investments in equipments and upgradation was required inter alia to provide additional required channels and to adopt the other requirements of digitalization network. However investments in equipments and upgradation as per requirement were turndown as the shareholders of respondent No. l company were not agreeable to infuse fresh funds and the option of raising funds through borrowing and loans was also dismissed. It is further submitted that as the Respondent No. 1 company decided not to go for digitalization, Respondent No. 2 was left with no alternative but to invest in Respondent No. 9 company. 5.12) It is....
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....ers state that after taking inspection of the documents filed by Respondents with Registrar of Companies, it was seen that the annual returns in respect of financial years ended, 31st March 2008, 31st March 2009 and 31st March 2010 are shown to have been signed by Petitioner No. 1. The Petitioner No. 1 submitted that he has not signed any of these documents. Similarly, the Petitioner has stated that Balance Sheet of Respondent no. 1 Company for the financial year ending 31st March 2008, 31st March 2009 and 31st March 2010, filed with Registrar of Companies are shown to have been signed by Petitioner No. 1, when in fact none of them have been signed by Petitioner No. 1. Accordingly, it is submitted that Respondents have forged the signature of Petitioner No. 1 in the aforesaid documents. 6.1 In this regard Ld. Counsel for the Respondents have stated that the said documents have been signed by Respondent No. 5, and name of the Petitioner No. 1 appears only in his capacity as Director of Respondent No. 1 Company. The reply of Respondent in this regard is self-explanatory and Petitioners have failed to establish that the documents in question are fabricated. 6.2 As regard cessation o....
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....e Board and its non-declaration cannot be termed to be an oppressive conduct". 7.2) It is pertinent to refer here clause No. 1 of Article 10 of S.P.A. which envisages as follows: "Annually, the JVC Board shall decide the amount of lawful profits to be retained in the JVC for expanding the operation of the JVC and the amount to be recommended for shareholders approval at the Annual General Meeting as dividend to be distributed to the parties in proportion to their respective shareholding in the JVC". 7.3) It is a settled preposition of law that declaration of dividend is normally left to the collective decision of Board and non-declaration of dividend cannot be a sole ground of oppression. Needless to say that audit of the records of the Respondent no. 1 Company has been ordered as discussed below, which will take in to consideration as to whether the carry forward profit amount has been properly utilized in the best interest of the Respondent No. 1, company. 8. As regards non-issue of bonus shares to Petitioners it is submitted that in the minutes of EOGM dated 30.03.2009, bonus shares were issued to existing shareholders of Respondent No. 1 company who were registered as membe....
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..... 1 viz, optic Fibre, cables, nodes, amplifiers and office premises being Office Nos. 104, 106 and 107 which is the property owned by Respondent No. l. Ld. Counsel for the petitioners emphasized that although the digital head end was shifted to Room No. 105 in Mayur Plaza, the other infrastructure and accessories owned by Respondent No. l viz. Optical fibre trunk cable, 8 numbers of 16 feet dish antennas installed on the terrace of Mayur Plaza and owned by Respondent No. l, EDFA transmitters, optical nodes etc. continued to remain the property of Respondent No. 1. The precise contention of Petitioners is that Respondent No. 9 was doing business from the premises owned by Respondent No. 1 Company and was earning profit at the cost of Respondent No. 1 Company. The Respondents have admitted in their affidavit in reply dated 22.10.2014 that equipment's as at Exhibit A were shifted from Respondent No. 1 premises to Room No. 105 in the same Mayur Plaza. This prima facie shows that Respondent No. 9 was at least using the premises of Respondent No. 1 before such shifting. Such use of premises of respondent No. 1 without consideration naturally would have caused loss to respondent No. l....
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....is that of Respondent No. 5. Similarly, it has not been disputed that Jagdish Danaj and Dilip Salve the Directors of NCCBSPL are both shareholders in Respondent No. l company. Petitioners have placed on record that the maintenance cost of Rs. 42,40,000 paid by Respondent No. l to NCCBSPL for the period 10.04.2009 to 31.03.2010 is almost 4 times more than the cost of Rs. 12 lakhs for purchasing the said cables. 9.5) It is also the case of petitioners that EOS Multilink (EM) was incorporated on 27.05.2013 and Gemini Digital Services (P) Ltd. (GDSPL) was incorporated subsequent to the filing of the present company petition. It is placed that the electricity bill of the EM shows the residential address of Respondent No. 5. Similarly the office address of GDPSL is that of residence of Respondent No. 5. Respondent No. 5 in his affidavit of Reply dated 30th March 2012, has made false statement that "Pertinently none of the directors/shareholders/members of Respondent No. 1 Company are directors/shareholders and/or members in the Network Managers and therefore the question of such transactions being related party transactions does not arise". Whereas it was shown that various members/shar....
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..... 2 company to Respondent No. l company. The Petitioners have also pointed out that as per balance-sheet of Respondent No. 1 company, a huge expenditure was made under technical support charges like Rs. 3,07,50,000 in the year 2008-09 and Rs. 3,40,00,000 in the year 2009-10, Rs. 3,70,00,000 in the year 2010-11 and Rs. 1,20,00,000 in the year 2011-12. It is further pointed out that an aggregate expenditure under all the heads as shown in the balance-sheet during the period from 2008 to the year 2014 comes to Rs. 68,55,63,747 which appears exaggerated and disproportionate. The Petitioner accordingly prayed that it is necessary in the interest of justice that all the books of account maintained by Respondent No. l are scrutinized by an independent Auditor appointed by this Tribunal. 9.8) The Petitioners have also referred to the special resolution dated 18.10.2013 passed by Respondent No. l, whereby Rs. 10,00,00,000/- (Rupees ten crores) loan was sanctioned in favour of Respondent No. 9 company for commercial purpose. This was countered by Respondent with the submission that the same was never acted upon and that no amount whatsoever was disbursed thereunder. Even though the resoluti....