TaxTMI 
TaxTMI 
2015 (4) TMI 1186
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 2.1. Since 1951 the Petitioner, along with his brother, late Kantilal Dalal, carried on business, principally through a partnership firm styled "Kantilal & Co.", with the increasing spread up business of other partnership firms formed and private limited companies floated, but Kantilal & Co., continued to be the flagship concern. Most of the real estate, either on ownership or on lease, was acquired by the said Kantilal and the Petitioner in the name of one of these partnership firms and private limited companies. 2.2. The sons of the Kantilal Dalal, being one Surendra Dalal and the Respondent No. 2 were joined as partners in the said Kantilal & Co. during 1969-71. The Petitioner is the paternal uncle of the Respondent No. 2 and grand uncle of the Respondent Nos. 3 and 4. 2.3. In 1985, the Respondent No. 1 Company was incorporated with the Petitioner and Kantilal Dalal as equal shareholders and a rice processing mill was installed and operated from Plot No. 1, Phase III, Badli Industries Estate, Samaypur Badli, Delhi-42. 2.4. The Petitioner is one of the promoters and founders of the Respondent No. 1 Company and one of the two subscribers to the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....business of the Company. As a result, because of the Respondent No. 2's egoistic and greedy attitude in treating the business as solely his and disregarding the set practices and standards, and the experience of the Petitioner, the well reputed and established business of rice exports was severely affected and this ultimately led to the closure of the aforesaid rice unit at the Badli plot somewhere around 2005-2006. 2.9. On 19/10/2006, the Respondent No. 3 was illegally appointed as an additional Director of the Company. The Petitioner was never informed about such appointment nor has he ever subsequently ratified such appointment. 2.10. In the year 2007, on several occasions the Respondent No. 2 humiliated the Petitioner when he attended the office of the Company, which were also the operational office of the other joint entities. The Petitioner was being kept in dark about the goings on of the businesses. Around April 2007, the Respondent No. 2 came to the Petitioner and suggested that he should retire from the said Kantilal & Co. and all the affiliated companies. The Petitioner, having realised by now that continuing business relations with the Respondent N....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2.12. On 15/2/2010, a notice was issued to convene an Extraordinary General Meeting (EOGM). In the EOGM held on 15/2/2010, a resolution was passed to increase the authorized share capital of the Company from Rs. 25 Lakhs to Rs. 1.5 Crores. No notice of this EOGM was provided to the Petitioner. 2.13. Pursuant to said illegal increase in the authorized share capital of the Company, on 30/3/2010 the Company illegally allotted 1,15,000 equity shares of Rs. 100/- each to the Respondent No. 2 and thereby illegally increased his shareholding in the Company from 14,900 shares to 1,29,900 equity shares of Rs. 100/- each. The Petitioner was never informed of any such alleged allotment of shares to the Respondent No. 2 nor was the Petitioner given any opportunity to purchase the additional shares when the Company sought to increase its issued capital by issuing additional shares. 2.14. Further, on 15/6/2010, a notice was issued by the Company to convene an EOGM, Consequently, an EOGM was held and the authorized share capital was further illegally increased to Rs. 3 crores vide a resolution passed in this EOGM. No notice of this EOGM was provided to the Petitioner. 2....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 2.19. As per the Balance sheets of the Company for the Year 2011-2012 the Company has advanced huge unsecured loans to the Respondent No. 2 and the Petitioner. From the Balance Sheet, it appears that the Company have lent long term loans to the Respondent No. 2 to the tune of Rs. 88,48,090/- and to the Petitioner to the tune of Rs. 1,49,33,066/- Further it appears that the Company has taken loans from Kantilal & Co. and the Respondent No. 4 to the tune of Rs. 45,004/- and Rs. 1,50,000/- respectively. However, the Petitioner is unaware of all the above transactions and he has not taken any such loan from the Company. 2.20. After the death of the said Kantilal on 8/3/2013. the Respondent No. 2 wrote to the Petitioner, ostensibly in his capacity of an executor of the Will of the said Kantilal Dalal and called upon the Petitioner to satisfy the claim of the Respondent No. 2 under the Award. When Petitioner pointed out the illegality and unenforceability of the Award and that the same infringes upon his rights and interests, the Respondent No. 2 claimed exclusive ownership of these joint entities and properties/assets, including the said Badli Plot. 2.21. Having ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... purportedly committed by the Respondent No. 2, and called upon the Respondent No. 2 to inter alia rectify the same within the time period stipulated therein. Vide the said Notice, the Petitioner also called upon the Respondents to provide him inspection of the entire records of the Company since 2004, which the Petitioner was entitled to as a 50% shareholder and director of the Company within seven days of Receipt of the said Notice. Further, vide the said Notice the Petitioner also called upon the Respondents to render true and accurate accounts of the Company and to pay him his lawful dues within fifteen days of receipt of the said Notice. The said Notice was received by the Respondents on the same day. Despite expiry of the notice period, the Respondents did not comply with any of the requisition under the said Notice. 2.27. On 25/9/2013, the Petitioner received a letter from the advocates of the Respondents seeking time to reply to the said Notice. However, feeling that the Respondents are merely buying time to fudge and fabricate the records of the Company to cover their tracks and defeat the rights of the Petitioner, he approached this Board for redressal of his gri....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d hereinafter in this judgment. 5. I have heard the Ld. Sr. Counsel appearing for the respective parties and perused the record. I have also gone through the written submissions filed by the parties' counsel and the citations filed in support of their respective contentions. Firstly, I would like to narrate the submissions advanced by the Petitioner's Counsel as to the alleged acts of oppression and mismanagement purportedly committed by the Respondents in the conduct of affairs of the Company here as under. Thereafter, I will describe the submissions in reply advanced on behalf of the Respondents and then I will render my findings on the contentious issues. 6. Dealing with the first complaint as to the illegal increase in the authorized and paid up capital of the company in the EOGM purportedly held on 15/2/2010, it was argued on behalf of the Petitioner that the authorized share capital of the company was increased from Rs. 25.00 Lakhs to Rs. 1.50 Crores. Similarly, on 15/6/2010, once again the authorised share capital was also increased illegally from Rs. 1.50 Crores to Rs. 3.00 crores. Mr. Jagtiani, Ld. Sr. Counsel appearing for the Petitioner, submitted that the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Respondent No. 2 and his family. None of the Resolutions are available nor produced by the Respondents. vi. The Petitioner, vide notice dated 21/9/2013, had sought inspection of all the records of the company, which included the minutes of the meetings mentioned above. However, the Respondents did not grant inspection of the documents of the Company to which is entitled to in law and, thus, an adverse inference has to be drawn against the Respondents. vii. As per the balance sheets for the year 2010-12, according to the Respondent No. 2 himself, the Company is a defunct and loss making company. Hence, there was no need to raise the authorized share capita) and to issue shares to the Respondent No. 2 and his family. It is thus clear that the Shares have been issued to the Respondent No. 2 and his family only with an ulterior motive of reducing the shareholding percentage of the Petitioner and his derivative interest in the Badli Plot. viii. The transfer of 100 shares by Respondent No. 2 to Respondent No. 3 is in violation of rights of preemption as the shares so transferred were not offered to the Petitioner. 7. Based on the above, it was argued that the illegal incr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Annual Returns of 2008-2009 his name was not reflected as a Director and he was never informed about his removal nor the prescribed procedure for removal of a Director was followed. The Sr. Ld. Counsel, therefore, contended that the removal of the Petitioner is illegal and oppressive for the following reasons:- a. The Petitioner was not served with any notice of the meeting in which he was removed as Director at his Pondicherry address and thus, is in violation of Section 284 of the Companies Act. b. The Respondents claim that notices were served at the address of the Petitioner registered with the Company, being "Khushnuma Apartments". However, the Respondent No. 2 has not provided any proof of service of such notices. c. The Respondents have not uploaded any records on the ROC website to show removal of the Petitioner as a Director. d. The Respondents have also not annexed any minutes of the meeting in which the purported decision to remove the Petitioner as a Director was allegedly taken. e. The Petitioner vide notice dated 21/9/2013 has sought inspection of all the records of the Company, which included the minutes of the meetings mentioned above. But, the Re....
X X X X Extracts X X X X
X X X X Extracts X X X X
..../2013 an EOGM was called, convened and held on 2/8/2013, in which equal shares of the Respondent No. 2 were transferred to Respondent Nos. 5 to 12. The Ld. Sr. Counsel contends that the said transfer of shares is illegal, inter alia on the grounds that the Petitioner was not served with the notices at his Pondicherry address of the meeting in which the shares were transferred by Respondent No. 2 to Respondent Nos. 5 to 12; that the shares transferred by the Respondent No. 2 to Respondent Nos. 5 to 12 were not offered to the Petitioner and thus such transfer is in violation of AOA; that the CA's certificate dated 11/7/2013 is fabricated as it records the transfer of 12 shares on that date, whereas the resolution to transfer shares was passed only on 2/8/2013; that the Respondents claim that a Board Meeting was held on 11/7/2013 wherein the transfers were approved. This defence is an afterthought, as the Petitioner was not served with the notice of the meetings. The purported Minutes of the said Meeting are not uploaded on the website. The Respondents have not annexed the Minutes of the said meeting nor provided inspection of the same; that the Respondent No. 2 has transferred on....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ts as a share holder and his right has been denied to be exercised and, therefore, this amounts to gross management within the definition of Section 398 of the Act. 14. Dealing with the Respondents' claim that Badli Plot belongs to the Respondent No. 2 personally as the same has been awarded to him vide arbitral award, it was argued by the Petitioner's Counsel that the Respondent No. 2 himself admits in his pleadings that the Badli Plot is the asset of the company. Thus, his case of Badli Plot being his personal property runs contrary to his own pleadings. 15. According to the Ld. Sr. Counsel for the Petitioner, Section 44 of the Indian Evidence Act, 1872, allows the Petitioner to question the validity of the Award dated 12/7/2010 which the Respondents seek to rely upon before this Board on the grounds of lack of jurisdiction, fraud, amongst others. The Ld. Sr. Counsel submits that the arbitration proceedings were only between the Respondent No. 2 and his father Mr. Kantilal Dalai relating to disputes with respect to the offshore bank balance. The Arbitrator has illegally awarded the shareholding of the Petitioner and the Badli Plot to the Respondent No. 2 and is, the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... It was, therefore, contended on behalf of the Respondents that the Petitioner despite having apprehensions and having an alleged position in the Respondent No. 1 Company, as stated in his own Petition, failed to take any action against the alleged non-compliances by the Respondent No. 1 Company. Further, the Petitioner failed to address this issue or take up any action against the same till the year 2013. 19. Taking me through the pleadings, the Ld. Sr. Counsel for the Respondents pointed out that the Petitioner has also sought to allege that in the year 2007, the Petitioner had made requests for the account and documents relating to the state of affairs of the Respondent No. 1 and the same were refused by the Respondent No. 2. According to the Ld. Counsel, it is also an admitted position that in the year 2007, the Petitioner, under the professional advice from his Chartered Account, demanded inspection of the accounts of the Respondent No. 1 Company. It is the further case of the Petitioner that in June 2007, the Petitioner was prevented from entering into the office and joint family residence by the Respondent No. 2. 20. Referring to the above pleadings as set out in the P....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ade by the Petitioner regarding his unauthorized and illegal removal as Director of the Respondent No. 1 Company, it is argued that the case of the Petitioner with regard to the alleged illegal removal is clearly contrary to the Petitioner's own case wherein the Petitioner has himself contended that he continued as an shareholder of the Company without any participation in the management of the Company. Therefore, it was submitted that the Petitioner cannot and ought not to be permitted to raise any grievance with regard to his alleged illegal removal as a director. 24. Apart from the above, it was argued on behalf of the Respondents that despite the Petitioner contending that he has not received any notices since 2007, at no point of time has he called upon the Respondent No. 1 Company to hold a Board Meeting or to issue notices calling for a Board Meeting which he ought to have done especially in light of his claiming to be a Director, Promoter and Founder of the Respondent No. 1 Company for a long duration of time. 25. According to the Ld. Sr. Counsel for the Respondents, the falsity in the Petitioner's case is evident from the fact that though he claims that no no....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing the course of submission before this Bench, the Petitioner sought to contend that Arbitration Award is illegal, malafide and cannot be taken cognizance of. However, the grievances with regard to the Arbitration award have been raised not only in Suit No. 470 of 2013 but also in Chamber Summons No. 1297 of 2013 in Execution Application No. 1036 of 2013 by the Petitioner. It was, therefore, argued on behalf of the Respondents that the Petitioner cannot and ought not be permitted to agitate with regard to the Arbitration Award in the present proceedings. 32. Apart from the above, it was argued that the Petitioner not only suppressed the fact from this Bench that vide Order dated 21/8/2013 passed by the Hon'ble High Court in Notice of Motion No. 1063 of 2013 in Suit No. 470 of 2013, the ad-interim reliefs were refused to the Petitioner, but also suppressed the Order dated 18/12/2014 in Chamber Summons No. 1297 of 2013 in Execution Application No. 1036 of 2013 by which the Petitioners objection to the execution of the aforesaid Award was rejected and the Chamber Summons of the Petitioner was dismissed. Therefore, it is submitted that by way of the present Petition, the Petiti....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the matter of Lalit Kumar Jain and Another Vs. Jaipur Traders Corporation Pvt. Ltd. (2002) 5 SCC 383 and Dalip Singh Vs. State of Uttar Pradesh and Others (2010) 2 SCC 114 that the Plaintiff seeking equitable remedy cannot approach the court with unclean hands or be guilty of laches. Further, it has been held by the Hon'ble Apex Court that the burden lies on the Petitioner to prove his case on the basis of material available and that the Petitioner cannot rely on weakness or absence of defence of defendant to discharge the onus. From the aforesaid facts and circumstances, it is evident that the Petitioner has failed to establish a case and, therefore, cannot rely on the weakness of the Respondents case in any manner. 37. Lastly, it was submitted that the present Petition has clearly been filed with a malafide intent and with a view to claim a share in the Badli Property. It is, therefore, submitted that the present Petition deserves to be dismissed with costs. 38. In rejoinder arguments, answering to the Respondent No. 2's contentions that since the Petitioner has challenged the Award in the Hon'ble High Court as well as in the execution proceedings and therefore....
X X X X Extracts X X X X
X X X X Extracts X X X X
....peal No. 6 of 2015. The Ld. Counsel submitted that the Petitioner, being a 50% shareholder, is entitled to file the present petition more so when the Respondent No. 2 is claiming exclusive possession of the Plot which itself is an act of oppression. The Ld. Sr. Counsel for the Petitioner, therefore, contended that there is no fetter in law from both these unrelated causes of action being pursued simultaneously. 40. I have considered the rival contentions and perused the record. On the basis of the pleadings and submissions of the parties, the first question that arises for my consideration is as to whether the Petitioner is eligible to file the present petition in terms of the provisions contained in Section 399 of the Act in this regard, it has to be noted that the Petitioner claims to be 50% shareholder in the total paid up capital of the company. According to him, by illegally increasing the authorized share capital and illegal allotment of further shares, the Respondents have diluted his shareholding from 30% to 5.08%. 41. It is a trite that in a petition where the allotment of further shares is challenged and the same is the subject matter of the petition, the original s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....very relief sought to be extended to a minority shareholder/s envisaged under Sections 397 and 398 of the Act" [Emphasis Supplied] ii] In the case of Raajratna Metal Industries Ltd. Vs. K. and S. Consulting Group P. Ltd. and Ors. [2009] 148 Comp Cas 756 (CLB) and Dinesh Sharma v. Vardaan Agrotech P. Ltd. [2007] 135 Comp Cas 133, the CLB it has held follows :- 15. ..On issue of maintainability though the petitioner's shareholding is brought down to 5.92 percent, after issue of further allotment of shares, otherwise the petitioner was holding 12.11 per cent, of the paid up capital. In view of the challenge of further allotment of shares, the petition is maintainable in accordance with law and also as held by the Company Law Board in Dinesh Sharma v. Vardaan Agrotech P. Ltd. [2007] 135 Comp Cas 133. Accordingly, the maintainability issue is answered in favour of the Petitioner." iii] Further, in the case of T.N.K. Govindaraju Chetty and Co. Vs. Kadri Mills (CBE) Limited [1999] 96 Comp Cas 871 (CLB), it has been held hereunder: "14. ....Allotment of shares to the exclusion of some shareholders has been held, by many High Courts and the Company....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... making out a case that they held 50 per cent, shares in this closely held family company in the nature of quasi-partnership. The respondents preliminary objection regarding non-maintainability of the company petition in terms of the requisite qualification under Section 399 is not tenable. The petition cannot be thrown out at the threshold." [Emphasis Supplied] 42. Relying upon the aforesaid decisions, I, therefore, hold that the Petitioner is eligible to file the instant petition. The preliminary objection taken by the Respondents is rejected being devoid of merits. 43. The next issue which arises for my consideration is as to whether the present petition is barred on account of delay and laches as well as principles of "estoppel" and "acquiescence" as the Petitioner did not take any action since 2007. 44. Having critically examined the record, it is an established proposition of law that the provisions of Limitation Act, 1963 do not apply to the proceedings under Section 397/398 of the Companies Act. Therefore, the contention of the Respondents that the petition is barred by limitation does not survive. In so far as the question of delay and laches is concerned....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... contending ownership of various entities, in which the Petitioner was a partner/shareholder and of the properties held in the name of those entities, the Petitioner made searches into the records of the Company. I do not find any reason to disbelieve the contention of the Petitioner that on an online search of the records of the company, as available with the ROC, carried out on 23/4/2013, he discovered the various acts of oppression and mismanagement committed by the Respondent No. 2 in collusion with the Respondent No. 3. On discovery of these gross acts of oppression and mismanagement, the Petitioner in order to safeguard his interest, on 11/9/2013 issued a notice to the Respondents bringing to their notice the various acts of mismanagement and oppression and also asked for inspection of the company's records, which was never granted despite his persistent demands even in the course of arguments before this Bench. Apart from the above, it is a settled proposition of law that if an act of oppression having continuous effect until the date of the petition, such petition is not hit by the principles of delay and laches. 45. It is pertinent to mention here that in the cases ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... hence the petition deserves to be dismissed. 49. I have considered this objection as well. It is a well settled proposition of law that if a party approaches a court for redressal of his grievances under equitable jurisdiction, he must come with clean hands and, in case, such party conceals any material facts or suppresses the relevant documents, he is not entitled to the discretionary reliefs from the court. However, elaborating the aforesaid proposition of law, it has been held by various courts that the ground of alleged suppression cannot arise unless it is demonstrated that (i) firstly, the fact was "vital and material" to the issue to be decided in relation to the reliefs claimed; (if) secondly, that such vital fact was not to the knowledge of the Respondents or that the document could not have been in the knowledge of the Respondents, or that the document was not a public document, and (iii) lastly, that by suppression of such fact, orders were obtained which would not have been granted if the correct and true facts were pleaded. In this regard the following decision and the relevant observations therein are relevant to be cited :- (i) Enercon Gmbh vs. Enercon (....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rbitration case pending before the Hon'ble High Court of Bombay, it would not be appropriate to touch upon the question of title with respect to the Badli Plot of the Company in these proceedings to avoid any conflict of opinion between the two forums. Furthermore, it is a settled proposition of law that a shareholder does not have any right with respect to the Company's immovable assets. He is not entitled to agitate this issue in the proceedings under Section 397/398 of the Act. The CLB in the proceedings under Section 397/398 of the Act is only competent to examine the disputes as to propriety rights in the capacity of the Petitioner being a shareholder of the Company in the case where the provisions of the Companies Act and/or Articles of Association of the Company are stated to be violated. Moreover undisputedly, the arbitration case is prior to the instant case. The Petitioner has already appeared and raised his objection in the competent forum. Therefore, it is not desirable on my part to deal with the issue as to the effect of arbitration case in these proceedings, I, therefore, refrain myself from making any comment on the alleged 50% claim of the Petitioner over t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ares is to be held an act of oppression, whether or not partnership principles are applied." 55. On a close scrutiny of the said decisions, the legal position emerges is that the power to issue shares is given primarily to enable capital to be raised when it is required for the purposes of the company but it can be used for other purposes also as, for example, to create a sufficient number of shareholders to enable the company to exercise statutory powers, or to enable it to comply with legal requirement as in the instant case. Hence if the shares are issued in the larger interest of the company, the decision cannot be struck down, on the ground that it has incidentally benefited the Directors is their capacity as shareholders. So if the Directors succeed, also or incidentally in maintaining their control over the company or in newly acquiring it, it does not amount to an abuse of their fiduciary power. What is objectionable is the use of such power simply or solely for the benefit of Directors or merely for an extraneous purpose like maintenance or acquisition of control over the affairs of the Company. Where the Directors seek, entering into an agreement to issue new shares, t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eholding of the Company held these EOGMs under challenge and took decisions for increasing further allotments. I, therefore, hold that the EOGM purportedly held on 15/2/2010 and 15/06/2010 and further allotment of shares made by the Respondents pursuant thereto as well as transfer of impugned shares In favour of the Respondent Nos. 3 to 4 is a clear act of gross oppression. 58. Now I proceed to consider the next instance cited by the Petitioner as to his removal as a director. Upon a close scrutiny of record, I do not find anything on record to show that the petitioner has been removed as a Director of the company in accordance with the provisions of law. The minutes of the EOGM dated 2/5/2008 and Board Meeting dated 6/5/2008, Form 61 and 62, etc. showing the alleged removal of the Petitioner as a director, are fabricated documents. Moreover, the said meetings are invalid for want of valid service of notice on the petitioner. The reasons for holding that the minutes of the said meetings are fabricated are corroborated by the following facts - (i) The Petitioner failed to trace any such Form 32 allegedly filed by the respondents with the ROC for his removal as a director....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oncerned, in the facts and circumstances of the case, it is well proved that he has been inducted as a Director only with a view to gain control of the company and oust the Petitioner from the Company. It is, therefore, held that the appointment of the Respondent Mos. 3 and 4 as a Director is also bad in law. There is ample evidence on record to show that the Respondents have failed to serve the statutory notices/documents on the Petitioner. The Petitioner has been denied inspection of documents and records of the company to which he is entitled to as a shareholder and director of the company. In my opinion, all these further acts amount to oppression. Although, the appointment of the Respondent Nos. 3 and 4 is bad in law as has been held herein above, but I would not prefer to remove them as the Directors in view of the peculiar fact of the case. It is to be noted that the Petitioner and the Respondent No. 2 hold 50:50% share. If they are only allowed to be on the Board of Directors of the Company, in that case, a situation of dead lock may arise. Admittedly, the Company has only an immovable property i.e. Badli Plot. It is not carrying any business activities for the last several....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ty, such as a director or a creditor, is outside the purview of the said section; (b) there must be continuous acts constituting oppression up to the date of the petition; (c) the events have to be considered not in isolation, but as part of a continuous story; (d) it must be shown as a preliminary to the application of Section 397 that there are just and equitable grounds for winding up the company; (e) the conduct complained of can be said to be oppression only if it can be said that it is burdensome, harsh and wrongful and the oppression involves at least elements of lack of probity and fair dealing to a member in matters of proprietary right as a shareholder. 64. A careful analysis of Section 397 would show that the winding up on just and equitable grounds would be automatic and this Board has to only form an opinion that such winding up would not be in the interests of the Company/shareholders and, accordingly, to mould relief with a view to put an end to the matters complained of. 65. It is further a settled proposition of law that where any shareholder is denied his most valuable rights in utter disregard of the statutory provisions, the making of a winding up order, o....