TaxTMI 
TaxTMI 
TaxTMI 
2017 (8) TMI 757
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....nstituting 59.95% of the total paid up capital of the company. It is also stated that there are 17 members in the second respondent company. 4. According to the petitioner, his wife Mrs. Jayshree J. Vyas and sons M/s. Upendra I. Vyas and Uday I. Vyas have given consent in writing for filing petition vide consent letter - annexure P-2 and, therefore, the petitioner is eligible to file this petition under section 399 of the Companies Act, 1956. 5. It is alleged by the petitioner that, the first respondent, without conducting any Board meeting, without following the procedure laid down in the Articles of Association of the company and without following provisions of the Companies Act, 1956, illegally allotted 15000 shares to herself on 5th December, 2007 and it is under challenge in this petition. Due to allotment of 15000 shares to the first respondent, paid up share capital of the second respondent company increased to 39900 shares and thereby percentage of the petitioner and his family members have reduced from 59.95% to 37.41%. 6. Respondents, in reply, took plea that, the petitioner is not qualified under section 399 of the Companies Act, 1956 for seeking reliefs though he has....
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.... no Board Meeting was held on 5th December, 2007 and no resolution was passed to allot 15000 shares to the first respondent. It is further alleged that, even assuming that the Board Meeting was held on 5th December, 2007, Mrs. Jayshree J. Vyas who is one among the two directors of the second respondent company, did not attend the purported Board Meeting and, therefore, there was no valid quorum for the meeting and therefore allotment of 15000 shares to the first respondent is invalid. 11. It is further alleged that, the Chartered Accountant who issued the certificate is not eligible to issue such certificate since he was not an authorised person of the company or auditor of the company. It is also alleged that, in fact no consideration was passed on by the first respondent to the second respondent company in respect of allotment of 15000 shares to the first respondent. 12. It is further contended that, there is no reason to allot 15000 shares to the first respondent on 5th December, 2007. 13. According to the petitioner, the reason stated by respondent No. 1 that, in order to give margin money to the bank loan, there is no need to allot shares and allotment of shares is not supp....
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....d by the first respondent and Mrs. Jayshree J. Vyas, wife of the petitioner. It shows that, Mrs. Jayshree J. Vyas is having knowledge of allotment of 15000 shares to the first respondent and she has also approved the same. Fact remain that, till the year 2010, neither the petitioner, nor his wife Mrs. Jayshree J. Vyas chose to challenge allotment of 15000 shares of the second respondent company to the first respondent. It is for the first time, in company petition 20 of 2010 a challenge was made regarding allotment of 15000 shares to the first respondent. 20. It is pertinent to mention that, company petition 20 of 2010 before the Company Law Board was filed by the petitioner in the year 2010. It is also pertinent to mention that the first respondent herein filed company petition No. 58 of 2010 for winding up of the second respondent company, before the Hon'ble High Court of Gujarat in April 2010. The said company petition 58 of 2010 was withdrawn by the first respondent herein on 26.04.2010 with liberty to file fresh petition with correct facts. Company petition 20 of 2010 filed by petitioner herein before the Company Law Board questioning allotment of 15000 shares to the firs....
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....ld on 24.04.2010. That means, after withdrawal of company petition 58/10, for the first time, the petitioner challenged allotment of 15000 shares to the first respondent on 13-7-2010. 26. From the aforesaid facts it can only be stated that, although Mrs. Jayshree J. Vyas was not present in the Board Meeting on 05.12.2007, she approved allotment of 15000 shares to the first respondent. Having approved the same in the year 2007 itself, Mrs. Jayshree J. Vyas or her husband i.e. the petitioner, did not chose to file a petition challenging the allotment of 15000 shares to the first respondent, till July 2010 in which month company petition 20 of 2010 was filed. Therefore, although allotment of 15000 shares is not according to the procedure laid down, there is acceptance of allotment of 15000 shares to the first respondent by wife of the petitioner in the year 2007 itself, but not challenged the same till July 2010. Having filed a petition in July 2010, challenging allotment of 15000 shares and having withdrawn the same with liberty to file a fresh petition in July 2012, did not chose to file this petition till 5th July, 2014. Therefore, initially, there was a delay of two years in chal....
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....any. Wife of the petitioner was director of the company and she has got knowledge of allotment of 15000 shares to the first respondent in the month of December, 2007 itself. As can be seen from the winding up petition No. 58 of 2010 there appears to be civil and criminal litigations between the shareholders and the outsiders. As stated by respondent No. 1, the petitioner also suppressed the criminal prosecution filed against the 1st respondent in respect of allotment of 15000 shares. No reasons are given by the petitioner for non-filing of this petition for two years, even withdrawal of company petition No. 20 of 2010. Therefore, conduct of the petitioner goes to show that he has not only suppressed the material facts and has caused delay at every stage in questioning validity of allotment of 15000 shares to the first respondent. 31. As regards consideration in respect of 15000 shares allotted to the first respondent, the petitioner wants to exhibit to this court that no consideration was given against allotment of 15000 shares. The petitioner has disputed the competency of the Chartered Accountant who has issued the certificate. Whether the Chartered Accountant is competent to is....
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....ed order to supply the goods to MGVCL, Vadodara as the proprietary firm had the facility to complete the order. According to the respondent, the said payment was done to M/s. Fuses Sales towards business transaction and, therefore, there is no question of siphoning of funds. 38. It is pleaded in the rejoinder that the order copy which is filed along with his reply by the respondent do not disclose supply of 63 Amp kit-kat fuses to MGVCL from M/s. Fuse Sales of which husband of first respondent is sole proprietor. It is pleaded that, on the other hand orders placed on record by the first respondent goes on to show that it was in respect of 865 LTD boxes each requiring 6 numbers fuses or so. It is also stated in the rejoinder that, order was placed on 07.11.2007 and it was completed on 31.03.2008. As no material was supplied to MGVCL, the amount of Rs. 19.97 lakhs shall be recovered from the first respondent along with interest as the contended by learned counsel of the petitioner. The said transaction took place in 2008 and the petitioner filed company petition 20 of 2010 in July, 2010 which is annexure P-6 to the petition. Reading of annexure P-6 to the company petition 20 of 2010....