AI Drafter - (New and Powerful) 
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter. 
TaxTMI 
TaxTMI 
2012 (7) TMI 1042
X X X X Extracts X X X X
X X X X Extracts X X X X
....nsferred in the name of the petitioner. On 22nd June, 2007 R-2 was appointed as director of R-1 by Shri Rajan Wagle. Appointment of R-2 to the post of additional director, was not confirmed in any ordinary or extraordinary general meeting ('EGM') of R-1. Form 32 was submitted to the office of the Registrar of Companies ('RoC') regarding the appointment of R-2 as the director of R-1, Further R-2 despite the illegalities has been acting as a director of R-1 since 22nd June, 2007. In Special Civil Suit No. 1781 of 2008, R-2 had produced minutes of EGM held on 8th August, 2007, wherein allegedly a resolution was passed reappointing R-2 as director of the company. It was contended that the minutes of the meeting have falsely shown the petitioner as present at the meeting and that she had voted in favour of the said resolution appointing R-2 as the director, she was not present at the said meeting nor had she ever voted in favour of any resolution appointing R-2 as director of R-1, R-2 had failed to produce any documents showing the signature of the petitioner to show either her presence at the meeting or her vote in favour of the said resolution. 2. On 6th August, 200....
X X X X Extracts X X X X
X X X X Extracts X X X X
....death of Shri. Rajan Shantaram Wagle, and that they now held majority shares of R-1-company as per returns filed at the end of the F.Y. of 2007 and requiring that no director should be appointed without the consent of the petitioner and Mrs. Divekar. Before the EGM called by the requisitionist could be held on 24th July, 2009, R-2 and R-3 approached the Bombay City Civil Court (Suit No. 1781 of 2009) to obtain an injunction against the proposed EGM. The said suit was eventually withdrawn by R-2 and R-3 and costs were awarded in favour of the requisitionist. However, in an affidavit filed on 8th December, 2009, in civil suit it was disclosed that the company had issued rights equity shares of which the late Shri Rajan Shantaram Wagle had purchased 1,592 shares, thus increasing his shareholding in R-1 to 2,592 shares. It was contended that the issuing of the new shares and their purchase by the Late Shri Rajan Shantaram Wagle was patently illegal. On 3rd July, 2009 petitioner demanded inspection of Register of members, balance sheets and records of the minutes of the meetings on 11th July, 2009, 13th July, 2009 and 14th July, 2009. However, when the petitioner arrived at the register....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... thereon; to confirm the appointment and reappointment of Miss Ashlesha Rajan Wagle as director of respondent No. 1 and to reappoint. Galgali & Associates as Statutory Auditors for the financial year ending 31st March, 2009 who were proposed to hold office from the conclusion of the called for general meeting ('AGM') to the next AGM and to fix their remuneration. The petitioner had submitted her written objections to the 3 items on the agenda for the annual general meeting which was to be held on 9th March, 2011. It was pointed out that although she was present at the premises of R-1 on 9th March, 2011, at 4 pm, no AGM of R-1 took place. On 14th March, 2011 petitioner wrote to R-1 asking for providing of a copy of the minutes of the meeting which was purported to have occurred on 9th March, 2011 and the resolutions passed therein. However, no such information was provided to her. Hence, the present petition was filed pointing out the acts of mismanagement and oppression which are continuous in nature and are continuing up till the date of the present petition, alleging that through their wrongful conduct the respondents have directly colluded to exclude the petitioner from ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... who made correspondence with Indian and foreign clients of the company for blacklisting of the company. Further, Mr. Deepak Divekar had filed criminal cases and civil suits against not only the company but also against its individual directors including the husband of petitioner-Kurkure. It was further pointed out that Mr. Deepak Divekar was removed from the company for his anti company activities in the year 2001 and both the petitioners are trying to bring him back into directorship despite his actions being detrimental to the company's interest is the respondents' case that both the petitioners had issued purported Notice under section 169 jointly with Mr. Deepak Divekar who is not at all a "member" of the company, the petitioners have joined hands with an outsider for interfering with the affairs of the company. It was argued that whenever the company issued letters to Mrs. Neelam Divekar as a shareholder, Mr. Deepak Divekar issued threatening letters to the company contending that it was Mr. Deepak Divekar and not Mrs. Neelam Divekar who was the shareholder of the company. It was pointed out that even Mrs. Neelam Divekar in her petition has taken a stand that the shar....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e Board comprising of the same R-2 Aseem Rajan Wagle had appointed the petitioner Mrs. Suhasini Kurkure as the director of the company and had fixed her remuneration as director. This shows the double standards adopted by the petitioner. The petitioner having availed of the benefits of the directorship, salary, car with driver from the R-1 having worked with him as a co-director till 31st December, 2008 is estopped from contending that the appointment of the R-2 is bad in law. Further, she has suppressed the fact that she has herself filled in Form 20B and submitted it to RoC under her signature by describing Mr. Aseem Rajan Wagle (R-2) as a Director and by placing his date of appointment as 22nd June, 2007. Now, it does not lie in the mouth of the petitioner that she was not aware of the appointment of the R-2 or that it was illegal appointment. Further, contending suppression of material facts it was pointed out that in the petition, Mrs. Kurkure has challenged the issue of 1,592 shares on the ground that she was not given notice of offer for the same, it is also, contended that it was first time known to her in rejoinder of the respondents No. 1 to 3 in the City Civil Suit No. 1....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the offer letter it was the petitioner who has to be blamed herself as till 31st December, 2008 she was herself the director of the company and in charge of accounts and administration, the letter has not been returned with the remarks 'incorrect address' but was returned with the remarks 'intimation and unclaimed' which means that on account of proper pin code and proper building name and due to correct name of the petitioner her flat was identified, intimation was delivered but petitioner did not claim the packet. It was pointed out that Mrs. Kurkure is in the habit of not receiving the correspondence sent by the company and all the letters sent to her have been returned with remark 'intimation and unclaimed'. 15. The counsel for the respondents argued that both petitioners objected issue of shares "at par". Despite of receipt of notice by Mrs. Divekar neither she purchased the shares at par nor she objected to the rate from 2008 till filing of the petition. The shares offered to Kurkure were not purchased at all. The petitioner in CP No. 54 (Mrs. Divekar) and the petitioner in CP No. 15 (Mrs. Kurkure) have been together in all the actions against the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n RoC site on 3rd July, 2009. 18. Further, it was argued that the purported EGM of 26th February, 2011 was illegal as the petitioner had made a false statement that she gave fresh notice dated 26th February, 2011 for EGM. In fact, the notice dated 26th February, 2011 itself shows that it was based on earlier infructuous notices dated 1st July, 2009 and 27th July, 2009. The notice or fresh notice dated 26th February, 2011 was patently illegal for the reasons that the same was not valid and binding, there is no appointment of new Directors as alleged, the alleged appointments are not legal and binding. Further, if it was impracticable to hold EGM it was open for the petitioners to invoke section 186 of the company's Act and not to hold EGM on Gate. 19. To support their contentions the counsel for the respondents placed reliance on sections 10E, 41, 169, 109B, 186, article 75-Table 'A' of the Act and article 137 of Limitation Act. 20. It was argued that the petitioner has no professional education and no experience of running the company, she has alleged that Mr. Rajan Wagle denied to her any access to the accounts of the company, if so, the petitioner has not exp....
X X X X Extracts X X X X
X X X X Extracts X X X X
....before the CLB and the petitioner cannot convert the CLB into a labour court. 25. The respondents pointed out that the entire property of the company is mortgaged/hypothecated with the Bharat Co-operative Bank (Mumbai) Ltd. The petitioner is fully aware of the said fact. It was the petitioner and Neelam Divekar who had immediately on the death of Mr. Rajan Wagle, given letter to the bank to stop operation of the account of respondent-company. The petitioner herself was signatory to the bank for renewal of CC facility and mortgage process when she held the director's office. 26. Considering the pleadings, the documents, arguments and the legal position as applied to the facts and circumstances of this case, I find that the petitioner has not been able to controvert the contentions of the respondents. It is noted that two Company Petitions (CP No. 54/11 and CP No. 15/2012) have been filed by two different petitioners alleging the same causes of oppression and mismanagement in the R-1-company and seeking similar reliefs without joining each other as a party in these petitions, the respondents' contention that the company petitions are not maintainable on account of non-j....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r section 387 /398. We cannot, therefore, debar the petitioner from claiming the equitable relief on merits of the case". This was reiterated by the CLB in the case of Smt. A Kalyani v. Vale Exports (P.) Ltd. [2003] 52 CLA 141 (CLB)/ [2004]119 Comp Cas 974. Limitation is not applicable to proceedings under section 397 /398, It Is true that the CLB is not a court for the purpose of the Limitation Act and as such the limitation. under article 137 of the Limitation Act, 1963, does not apply to the proceedings before the CLB, however, this does not preclude the CLB from rejecting/dismissing petitions on account of delay/laches in appropriate cases. Delay and laches do apply which start from the date of knowledge. The doctrine of laches is based on equitable consideration and depends on general principles of justice and fair play. There is no presumption that delay is deliberate. To be the laches delay should be such that it could be said that the petitioner is not entitled to relief on account of gross negligence or inaction or for want of bona fide imputable to him or that he has given up (waived) his right by acquiescence or by his conduct or neglect. Further, this Board has consiste....
X X X X Extracts X X X X
X X X X Extracts X X X X
....titioner was allegedly removed from directorship in that meeting; there are no annual reports, final accounts with RoC after 31st March, 2007; when on 27th June, 2009 Wagle died, R-2 was the only director left; R-2 appointed R-3 as additional director illegally; on 1st July, 2009 P Divekar requisitioned EGM, no EGM was held in 21 days; EGM to beheld on 17th August, 2009 was requisitioned; R-2. R-3 filed civil suit to obtain injunction on Notice for EGM, civil suit was withdrawn; inspection of register of members, meetings, balance sheets was not provided; EGM was requisitioned; premises were found locked, EGM was held and petitioner Divekar appointed as director; RoC issued notices for defaults, do not advance and strengthen her case of oppression and mismanagement in view of her acquiescence in most of the acts and in view of her conduct which has been prejudicial to the interest of the R-1-company. Further the petitioner has failed to controvert the respondents, contentions made in reply to her alleged acts of oppression and mismanagement. 32. The settled principle of law is that when a person seeks equity he must come with clean hands. In the case of Srikanta Datta Narasimhar....
X X X X Extracts X X X X
X X X X Extracts X X X X
....398....The court, therefore, exercising equity jurisdiction, cannot ignore the well known maxims of equity. Two such maxims are that he who seeks equity must do equity and he who-comes into equity must come with dean hands...". 33. There have been allegations and counter allegations. The CLB is a court of equity and considering the equities between the parties, I find that the equity is in favour of the respondents. Rather it is the conduct of the petitioners as detailed above which has been prejudicial to the interests of the functioning of the company. Therefore, it would be highly unjust to grant the prayers sought by the petitioners. Such a relief if granted could be highly oppressive to the respondents. In the present case, the conduct of the petitioner shows that she has not come with clean hands, in the sense, she has acted in a manner prejudicial to the interests of the company as well as the shareholders and it is she who has acted in violation of mutual trust and confidence. When an action is taken against a wrongdoer, she cannot seek remedy in equity. Her prejudicial acts forced the shareholders to remove her as a director and as such I do not find that there is any a....