TaxTMI 
TaxTMI 
TaxTMI 
2014 (2) TMI 1301
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....his various landed properties and other assets which he possessed at the previous place of his abode. The said Benoy Krishna Mitra as Managing Director incorporated the respondent no.1 Company i.e. India Steam Laundry Pvt. Ltd on December 3, 1948. The said Company was primarily a Family Company as the shares were held by the members of the family and their relatives. The said deceased was managing the said Company along with his three sons namely Prasanta Kumar Mitra, Tarun Kumar Mitra and Prabhat Kumar Mitra who were assisting the said Managing Director in managing and running the said Company. Till his death i.e January 31, 1974, the said Benoy Krishna Mitra was holding the post of a Chairman and Managing Director of the said Company. Upon the death of the Benoy Krishna Mitra, his eldest son Tarun Kumar Mitra was appointed as a Managing Director and continued as such till his death i.e. April 27, 2011. In the year 1973, it was decided to take a financial assistance to augment the income of the Company to pledge the certain quantity of shares to RIBI now renamed as IIBI, the respondent no.9 herein, with clear stipulation that the said financial Company shall have a representation....
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.... by the petitioner no.3 being C.A. 485 of 2011 alleging that the respondent no.2 had been making an efforts to let out the factory and was contemplating to give an inspection of the factory premises to an outsider. It is further alleged that upon an inquiry being made with the Registrar of Companies, West Bengal, it appears that one Smt. Srila Mitra, widow of Prasanta Kumar Mitra, the petitioner no.1 had been appointed as an Additional Director of the respondent no.1 Company with effect from September 5, 2006 and Form No. 32 was filed with the said register on August 27, 2010. It is further alleged that the said purported appointment had been shown to be made by the respondent no.2 as Managing Director on the basis of an authorization by the Board of Directors taken on August 27, 2010. It is further evident from the said Form 32 that the Former Directors of the Company namely Subimal Bhattacharyya, Dhiman Chandra Biswas & Debranjuan Basu Mallick resigned from the Board of Directors with effect from September 30, 2006. A leave was also sought therein to serve the copy of the said petition upon the said Srila Mitra. Before the said application being C.A. No. 485 of 2011 could be mov....
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....n his affidavit affirmed on June 25, 2011. The salient features of his contentions in the said affidavit are that no annual general meeting of the Company was ever held as alleged by the respondent no.2. It is further contended that the purported appointment of Mr. Indrajit Roy and Jayati Roy as Directors of the Company on April 27, 2011 could not be made as the said Tarun Kumar Mitra expired on the same day. It would further be evident that there was an election in the State of West Bengal on April 27, 2011 and, therefore, the alleged appointment is bad and illegal. It is recorded therein that Smt. Srila Mitra sold her share of her husband which she inherited on his death in pursuance of the terms of settlement dated September 12, 1995 for valuable consideration which would be corroborated by letter dated August 16, 2007 issued by the said Srila Mitra to the respondent no.2. Srila Mitra in her affidavit said that she was appointed as a Director of the Company which was ratified and confirmed in the resolution adopted in the general meeting held on September 30, 2006. It is further said that the annual general meeting was held on diverse dates between the year 2006 and September 6....
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....n terms of Clause 10 thereof. Therefore, he contends that because of the specific embargo relating to the transfer, the alleged transfer is not valid and, therefore, no right could be accrued in favour of the alleged impleaded respondents. It is further contended that since the incorporation of the Company, the respondent no.1 herein, all the shares were held by the family members and their friends and relatives and there were no outsiders and the embargo created under Article of Association is clearly attracted and, therefore, the transfer made to an outsider is invalid and placed reliance upon a judgment of the Supreme Court in case of John Tinson & Co. Ltd. & Ors. V Mrs. Surjeet Malhan & Anr., reported in (1997) 88 Company Cases 750 and of the Principal Bench, Company Law Board in case of V. Ramesh Kumar & Ors. V S. Jayakrishnan & Ors., reported in (2008) 141 Company Cases 915. Mr. Sarkar strenuously submits that 50,162 shares of the respondent no.1 Company were deposited with IIBI as security for advancement of the loan to the Company which is still retained by the said IIBI and, therefore, the issuance of the duplicate shares is opposed to Rule 4 (3) of the Compan....
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....by the other directors excepting the said Tarun Kumar Mitra, the respondent no. 2 herein, there was only one director and, therefore, all acts done subsequently are invalid. He further submitted that on the information received from the web site of the Ministry of Corporate Affairs, it would appear that one Binota Basu was appointed as an Additional Director of the Company with effect from 12 April, 2012 and after the death of the Managing Director, the respondent no.2, the said Binota Basu and Srila Mitra allegedly appointed one Jayati Roy and Indrajit Roy as directors on the basis of the resolution of the Board of Company held on 27th April, 2011, the day on which the said Tarun Kumar Mitra died. The said day was also a public holiday because of the ensuing election and, therefore, those are invalid and the alleged directors cannot claim in such capacity as validly appointed directors. According to Mr. Sarkar, Sections 397 and 398 of the Companies Act, 1956 provides a remedy against the oppression and mismanagement of the Company and is maintainable at the instance of an individual member who acts in a representative capacity. The death of any of the person does not abate the pro....
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....a High Court in case of Promode Kumar Mittal & Ors. V Southern Steel & Ors., reported in 50 Company Cases 555, J.L. Dutt & Anr. V Hooghly Ink Co. reported in 1982 (1) CLJ 422 and a judgment of the Apex Court in case of Jaiprakash Gupta V Riyaz Ahmed & Anr., reported in (2009) 10 SCC 197. Mr. S.B. Mookherjee, the learned Senior Counsel appearing for the respondent no.3, supporting the petitioner, principally agreed to the submissions made by the petitioner and additionally submits that share transfer can only be made if the conditions engrafted under Section 108 of the Companies Act is followed. He submits that the original certificates are lying with the IIBI and what is sought to be transferred is the duplicate shares allegedly issued in favour of the persons other than the recorded holders without properly executed instruments and, therefore, are illegal and invalid. In support of the aforesaid contentions, he placed reliance upon the judgment of the Supreme Court in case of Mannalal Khetan V Kedar Nath Khetan reported in AIR 1997 SC 536, Claude Lila Parulekar(Smt.) V Sakal Papers Pvt. Ltd., reported in (2005) 11 SCC 73 and a judgment of this Court ....
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....d in 2007 (3) CHN 287. In support of his contention that the Court can take into consideration the subsequent events provided; it has a nexus to the original cause of action and where the parties intend to rely upon a distinct and separate cause of action unconnected with the original one, the same cannot be considered because of the Companies (Amendment) Act, 1981 and placed reliance upon a judgment of the Supreme Court in case of Dabur India Ltd., -vs- K.R. Industries reported in (2008) 10 SCC 595 and in case of DDA & Ors., vs Joginder S. Monga & Ors., reported in (2004) 2 SCC 297 and a judgment of this Court in case of Raj Kumar Dutta V Bimal Kumar Dhar reported in 2008 (2) CHN 746 and in case of C. P. Gnanasambandam V Tamilnand Transports (Combatore) Pvt. Ltd., & Ors. reported in 41 Comp. Cases 26. He further submits that the transfer of shares by the Managing Director, the respondent no. 2 and the Prasanta Kumar Mitra are within the realm of a private disputes and in absence of any challenge being thrown either by the said share holders or their heirs, a third party cannot questioned such transfer and placed reliance upon a judgment of the Apex Court in case of San....
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....n dispute and the same having been transferred in favour of his clients cannot be questioned in the present proceedings. The restrictions imposed under Article of Association does not put an absolute bar in transferring the shares when in fact, there was an outside directors and share holders than the members of the family. He further submits that it is an admitted position that the Company is no longer involved in any business activities and the only source of income is, by realization of the rent from the tenants, inducted by the Company. By way of an interim order passed by this Court, the interest of the share holders and/or members are sufficiently protected as the Special Officer appointed by this Court is realizing the rent. The Company Petition, though become infractuous, is still recorded in the docket of this Court and there is no final recording relating to the disposal thereof have been passed. Thus, he contends that by way of an interlocutory application, the petitioner cannot achieve the goal what he could not get in a main proceeding. He concurs and adopts the submission of Mr. Saha that the alleged set of facts which are sought to be brought under the subsequent eve....
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....f the said Amendment Act and it is nobodies case that the same is not triable by the High Court. According to the petitioners and the supporting respondents, if any subsequent events occurred during the pendency of the proceeding, the Court must take note thereof and can mould the relief if the main relief becomes inappropriate. The subsequent events intrinsically connected with the original cause of action and have the material bearing on the principle issue involved therein, the Court should take note of the same to render complete, effective and appropriate remedies to the litigant. The Court should take note of the subsequent events to minimize the litigation and to render complete and effective adjudication of a dispute between the parties. It must be interconnected and intertwined with the original cause of action not capable of being divorced. The subsequent event which stands alone independently and have no relevance to the context of original disputes constitutes a fresh cause of action. The Court is not obliged to take note of all events subsequently arisen unless it has a material bearing on the original cause of action. In a time consuming adversial litigation, some tim....
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....r which had not been considered in Dhodha House but it never meant that two suits having different causes of action can be clubbed together as a composite suit." It appears from the above report that the composite suit in respect of the two distinct cause of action where the jurisdiction is specifically provided under the statute in respect of one cause of action cannot be entertained by the Court, having no jurisdiction pecuniary or territorial or otherwise. There was admittedly two separate cause of action pleaded in the composite suit which are distinct, separate and stands on the independent footing. The aforesaid principle in my view cannot be applicable in a case where a subsequent events are brought before the Court which is intertwined with the original cause of action. Even in case of DDA & others V Joginder S Monga & others reported in (2004) 2 SCC 297, the Supreme Court held that the Court can take into consideration the subsequent events to grant appropriate relief but if it substitutes the new relief based on fresh cause of action, the same is impermissible. The Division Bench judgment in case of Raj Kumar Dutta (supra) relied on by the descending respondents c....
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....d in 67 Company Cases 491 that the Company Court can pass an interim orders where the serious disputes relating to forgery and defalcation amounting to mismanagement, oppression and misappropriation is made. The aforesaid judgment lend support to the proposition that the Court can appoint the receiver and/or pass the interim orders in an appropriate cases to take over the management and affairs of the Company to protect the interest of the other members. The aforesaid judgments were passed on a distinguishing feature where the Companies were in operation and serious allegation relating to misappropriation and/or defalcation of the funds were brought before the Court. Had it been a case where the Company is fully operational and serious allegation as to the misappropriation of the funds and monies by the majority members or the Board of Directors are prima facie proved before the Court, there is no hesitation in my mind that the Course adopted by this Court in above reports was an inevitable consequence. As indicated above, in the instant case, the Company does not have any commercial activities. It has the immovable properties which are let out to the different tenants. The intere....