TaxTMI 
TaxTMI 
2017 (11) TMI 1484
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....e purpose of deciding this appeal are as under :- 2. It is the case of the appellant that some time in the year 1974-75, the respondent no.1 was purchased by 5 brothers of Gupta family namely Mr.Somdev Gupta, Mr.Nand Lal Gupta, Mr.Jagdish Lal Gupta (appellant herein), Mr.Subhash Gupta and Mr.Prem Gupta with joint family money. The shareholding of each brother was approximately 20% of the equity capital of the said company. The said company was incorporated on 28th September 1966 under the name and style of 'Mohan Textile Industries Private Limited' with authorised capital of Rs. 15 lakh divided into 15000 equity shares of Rs. 100/- each. The name of the said company was changed to 'Cameo Fabrics Ltd.' on 21st March 1968. The said company had taken a loan from Bank of Baroda to purchase the plant and machinery and for construction. The said company, however, failed to repay its loan installments and to meet the salary payment to its employees. 3. It is the case of the respondent nos.1 to 5 that Shri Chandratan Mohta, Smt.Ashalata Mohta and Smt.Pushpavati Harkisondas (original promotors) of Mohan Textile Industries Private Limited agreed to sell the respondent no.1-....
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....yakar, Director and resolved to allot 1800 shares of Rs. 100/- each to her. On 6th May 1994, Mr.Sanjay Gupta, appellant no.2 was appointed as a Director of the appellant no.1-company. On 23rd December 1994, the respondent no.1 received demand notice for payment of Excise duty for Rs. 9,01,172/- and continued to receive the same for additional amounts from time to time. It is the case of the respondent nos.1 to 5 that on 1st March 1995, a Board meeting was held calling an Extraordinary General Meeting (EGM) on 7th May 1995 to increase its authorised share capital by Rs. 25 lakh. On 7th May 1995, a resolution was passed to increase the share capital by Rs. 25 lakh at the said EGM. On 16th May 1995, Form 23 and Form 5 were filed with the Registrar of Companies. On 6th January 1996, the Board of Directors in the meeting recorded their distress that none of the shareholders were willing to invest money in the company to meet with the Excise Demand. 7. On 4th March 1996, the Board of Directors resolved to increase its issued share capital through offer of 2600 shares to meet with the Excise Demand. It is the case of the respondent nos.1 to 5 that all the shareholders were duly informed.....
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....y members during the funeral rites of Mr.Somdev Gupta. The appellant made an effort to convey to him that all the brothers were now getting old and it was better to resolve various family issues/properties since certain disputes had arisen among the family members. 12. It is the case of the respondent nos.1 to 5 that the factory building of the company was old and extremely dilapidated and was in need of urgent rebuilding. The estimates for rebuilding the factory and installing new machinery was about Rs. 4.3 crores and initial financial requirement was Rs. 10 lakh. The Board of Directors accordingly passed a resolution on 23rd September 2004 resolving to raise share capital of the respondent no.1 by issuing 10000 shares of Rs. 100/- in terms of Articles 37 and 38 of the Articles of Association of the respondent no.1. All the shareholders including the appellant and the respondent nos.7 to 10 were invited to subscribe to those shares. Mr.P.S. Nadkarni, Architects were retained to design and obtain approval from the development authorities. 13. On 4th December 2004, none of the shareholders offered to subscribe to 10000 equity shares of the respondent no.1-company. The application....
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....nt that the shareholdings of all other four brothers together were reduced from majority of 80% to minority of 22%. The appellant was also able to peruse the balance sheets of the respondent no.1 and it was clearly evident that the additional equity shares were issued only to the Nand Lal Gupta group at par just for changing the shareholding pattern and creating an illegal majority in favour of the Nand Lal Gupta group. 17. It is the case of the appellant that in the balance sheet of the respondent no.1 for the years 2001-02, 2002-03, 2003-04 and 2004-05, there was Bank FDR & Cash of Rs. 21 lakh, Rs. 24 lakh, Rs. 33 lakh and Rs. 33 lakh respectively and thus the respondent no.1- company had no need for funds. According to the appellant, the balance sheet of the respondent no.1 showed that no purchases were made for plant and machinery of the respondent no.1 for two decades. Salaries were being paid to the Directors of Nand Lal Gupta group. It is the case of the appellant that the said salary amount along with funds siphoned off from the company had been used to subscribe to additional shares by "round tripping." The authorised share capital of the respondent no.1 was illegally rai....
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....s to comply with the order passed by the Company Law Board on 8th August 2006. 20. It is the case of the respondent nos.1 to 5 that the respondents filed a reply in the Company Petition No.70 of 2006 and placed on record material evidence to the extent available with them in the form of Income Tax and Wealth Tax Returns of the appellant and the respondent nos. 8, 9 and 10, for the assessment years 1986-87, 1989-90, 1992-93 and 1996-97 showing their respective shareholding in M/s.Cameo Fabrics Ltd. and valued the said shares as declared from year to year in the balance sheet of the respondent no.1. It is the case of the respondent nos.1 to 5 that for the period after 1993, the returns of the appellant and the respondent nos.8 to 10 were not available with the respondent nos.1 to 5 because of exemptions introduced. The appellant and his wife held 10.40% shares in Sabina Woollen Mills Pvt. Ltd., a company which was making handsome profits and had assets worth Rs. 40 crores. It is the case of the respondent nos.1 to 5 that the appellant was an Executive Director in the said company and had stripped and transferred the assets of the said company to one APS International Pvt. Ltd. and t....
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....1 to 5 annexed certain documents to the sur-rejoinder. 25. On 2nd August 2007, the appellant filed a petition before Delhi High Court regarding alleged manipulation of the records of the respondent no.1 company by the contesting respondents. On 2nd August 2007, the Delhi High Court passed an order in L.P.A. No.1118 of 2007 and thereafter Reserve Bank of India (RBI) had referred the matter for investigation to Directorate of Enforcement against the complainant by letter dated 23rd February 2010. It is the case of the appellant that Mr.Nand Lal Gupta (father of the respondent no.2) did not join the investigation being conducted by RBI. 26. On 16th August 2007, the appellant and his wife filed an application being Company Application No.425 of 2007 in Company Petition No.79 of 2006 inter alia praying for impleadment of M/s.Tara Industries Ltd. as the respondent no.12 in the Company Petition No.79 of 2007 and also prayed for addition of one of the prayer clause to the effect that the appellant should be given equal shareholding/effective right in the assets of M/s.Tara Industries Ltd. equal to that of Nand Lal Gupta group and Prem Gupta group and/or 1/3rd share in the unencumbered as....
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.... false to the knowledge of the appellant and his wife but also contradictory to the statutory records filed by them with the Registrar of Companies. The respondent nos.1 to 5 also brought on record that a complaint under Sections 628 and 629 of the Companies Act had been filed before the Additional Chief Metropolitan Magistrate, 8th Esplanade, Mumbai who had passed an order dated 24th April 2008 and had issued process for the offence upon the said persons. 30. On 1st October 2008, the Company Law Board passed an order in CA No.513 of 2008 and clarified that the order dated 8th August 2006 did not restrain the respondent no.1 from carrying out renovations, improvements etc. to the fixed assets of the respondent no.1. 31. On 24th February 2009, the appellant and his wife had filed a contempt petition being No. 1144-45 of 2006 before the Delhi High Court in respect of the incident dated 10th August 2006 of denial of inspection by the respondent nos.1 to 5. The Delhi High Court passed an order on 24th February 2009 disposing of the said contempt petition and observed that the respondent nos.1 to 5 had tendered unconditional apology and had complied with the order dated 8th August 200....
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.... arguments which were to be commenced from 25th July 2011. The matter was thereafter listed on 25th July 2011. It is the case of the respondent nos.1 to 5 that the appellant herein and his wife addressed their arguments in Company Petition Nos.70 of 2006 and 2 of 2008. 36. After conclusion of their arguments, the respondent nos.1 to 5 commenced their reply. The matter was heard from 25th July 2011 to 29th July 2011, 18th August 2011, 6th and 7th September 2011, 20th and 21st October 2011 and thereafter on 20th December 2011 and 27th January 2012. The appellant and his wife had already concluded their submissions. The respondent nos.1 to 5 were present with their reply. The appellant and his wife, however, suddenly insisted that their pending CA No.425 of 2007 for impleadment of Tara Industries Ltd in Company Petition No.70 of 2006 be taken up for hearing in view of the order passed by this Court on 12th January 2012. 37. In the month of March and April 2012, the Company Application No.514 of 2011 and Company Application No.425 of 2011 were listed for hearing on 5th March, 2012. Company Application No.514 of 2011 was part heard and was adjourned to 27th March,2012. On 27th March,2....
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.... 2012 on the next date of hearing and directed that the affidavit in reply be filed in Company Application No.471 of 2012 within four weeks from the date of the said order and listed the matter on 5th February, 2013. 41. On 5th February, 2013 the Company Law Board passed an order directing the parties to complete their pleadings in all the applications as well as in the main petition if they were not completed and to get ready for hearing in the main petition for the reason that the hearing in the main petition could not be taken up so far despite the same were filed in the year 2006. It was made clear by the Company Law Board that during the course of hearing in the main petition, if the Company Law Board was of the view that if hearing in any of those applications were required to be decided alongwith the main petition, then such application would also be heard along with the main petition. The Company Law Board adjourned the hearing in the company petition to 28th March, 2013. 42. On 6th March, 2013, the respondent nos. 1 to 5 filed Company Appeal No.48 of 2014 challenging the order dated 7th January, 2013. On 6th May, 2013, the appellant and his wife challenged the order date....
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....fe. Learned counsel also filed written submissions on behalf of her client for consideration of this court. 46. It is submitted by the learned counsel that the respondent no.1 is the closely held family run company in the nature of a quasi partnership that was purchased by five brothers of Gupta family along with their spouses with joint family business to do together based on mutual understanding. She submits that the shareholding of each brother was approximately 20% of the equity capital of the company. For all practical purposes, in essence and in reality, the respondent no.1 is a glorified partnership amongst the brothers. The appellant has been permanently based in New Delhi. The other brothers except Mr.Nand Lal Gupta were based in Amritsar, Ludhiana in Punjab. The registered office of the company is located at 101, Churchgate Chambers, 5 Marine Lines, Mumbai. 47. It is submitted that Mr.Nand Lal Gupta, respondent no.2 was based abroad but was frequently visiting Mumbai. The respondent no.1 company came under exclusive management of Mr.Nand Lal Gupta based on the mutual understanding between the brothers that he would manage the respondent no.1 for the benefit of all the b....
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....ation of the company and financial statement and annual returns for the year 2002-03 and 2004-05 available on the website. 50. The appellant noticed the illegal increase in shareholding of Nand Lal Gupta Group and dilution of the shareholding of the appellant in the respondent no.1. She submits that on 20th July, 2006, the appellant conducted further inspection of the limited records available with the Registrar of Companies and learnt of illegal change in the shareholding pattern of the respondent no.1 and mismanagement of the affairs of the said company over the previous 10 to 20 years by the Nand Lal Gupta Group. She submits that the respondent nos. 1 to 5 did not annex any company records/minutes of the meeting in their affidavit in reply to the company petition. She submits that though the Company Law Board had passed an order dated 8th August,2006 for authentication of the statutory records of the respondent nos.1, 2, 4 and 5 who were present at the office, they refused the authentication of the records of the company. 51. It is submitted that in the affidavit in reply, Nand Lal Gupta Group for the first time annexed the documents at serial nos. 5 and 6 i.e. purported tax r....
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....file any application for forensic examination. Mr.Nand Lal Gupta Group had filed its sur-rejoinder only on 12th March, 2007 annexing the disputed documents. His client was thus required to file Company Application No.427 of 2007 inter alia praying for rejection of the documents annexed to the sur-rejoinder and for not taking the same on record. She submits that respondent nos. 1 to 5 filed further forged fabricated and ante-dated documents along with additional affidavits on 25th November 2011, 26th November 2011 and 17th March, 2012. She submits that the principles of delay and latches are not applicable to the proceedings under sections 397, 398 of the Companies Act, 1956 and thus the applications filed by the appellant could have been rejected on that ground. In support of this judgment, learned counsel placed reliance on the judgment of Delhi High Court in case of A.P.Jain vs. Faridabad Metal Udyog, reported in (2005) 123 Comp.Case 785 (Delhi). 55. It is submitted by the learned counsel that insofar as purported minutes of the meetings of the board of directors of the respondent no.1 from year 1986 upto 2004 are concerned, the same were filed by Nand Lal Gupta Group for the fi....
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....Woollen Mills Private Limited in Mumbai and Punjab during the relevant time. It is submitted that Nand Lal Gupta Group in collusion with Prem Gupta Group had forged, fabricated and falsified statutory records of the company and forged the signatures of the appellant on various documents without his knowledge. Nand Lal Gupta Group had full access to the records of Sabina Woollen Mills Private Limited during the relevant time. She invited my attention to the order dated 9th March 2012 passed by the Company Law Board in Company Petition No.21(ND) of 2010 filed by Mr.Subhash Gupta against Sabina Woollen Mills Private Limited recording that all the records had been taken away of the management of Sabina Woollen Mills Private Limited and were not there at the registered office nor had been maintained there. 59. Learned counsel appearing for the appellant invited my attention to the order dated 23rd June, 2012 passed by Shri Justice S.J.Kathawalla in Company Appeal No.14 of 2014 filed by the appellant in respect of Sabina Woollen Mills Private Limited appointing an independent handwriting expert to examine the documents of Sabina Woollen Mills Private Limited which are listed at serial n....
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....of the appellant which were filed by Nand Lal Gupta Group along with their affidavit in reply dated 13th October, 2006. She submits that the appellant has disputed the signatures of the appellant on the purported letters and the same have been forged by Nand Lal Gupta Group and thus an handwriting expert ought to have been appointed by the Company Law Board. It is submitted that the appellant has already contended in the affidavit in rejoinder that he had not filed any independent income tax, wealth tax returns because all the filings were done from Mumbai through the office of respondent no.1 which was in possession of Nand Lal Gupta Group and the payments were also made from Mumbai Office itself. 63. It is submitted that the appellant has been based in New Delhi for last more than 35 years even before purported returns were filed by Nand Lal Gupta Group which are annexed to the affidavit in reply. It is submitted that the appellant being the brother of Mr.Nand Lal Gupta and entrusted the entire filing of the documents including taxation to his brother and since the filings were at Mumbai, the documents were sent to Mumbai and dealt with at Mumbai. The appellant has no access to ....
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....report of Central Forensic Science Laboratory has not been challenged by any of the contesting respondents whereas the closure report relied upon by the respondent nos. 1 to 5 has been challenged by the appellant by way of Protest Petition No.678/MISC/2014 before the Magistrate Court at Esplanade, Mumbai. No orders have been however passed by the learned Magistrate in the said petition. Learned counsel placed reliance on the judgment of this court in case of HSBC PI Holdings (Mauritius) Limited vs. Avitel Post Studioz Limited and others, reported in 2014 SCC Online Bom. 102 and in particular paragraphs 90 to 92 holding that since the opinion of the Economic Offence Wing has not been accepted by the learned Magistrate at that stage, this court did not consider the correctness of the report submitted by the Economic Offence Wing at that stage. She submits that the closure of Economic Offence Wing heavily relied upon by the respondent nos. 1 to 5 thus cannot be considered by this court. 67. It is submitted by the learned counsel that by an order dated 16th February, 2017 passed by this court in Criminal Application No.140 of 2014 and Criminal Application No.135 of 2014, the said crim....
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.... in Company Appeal No. 14 of 2014, Shri Justice S.J.Kathawalla had already passed an order for referring four documents to forensic expert for examination. She placed reliance on the order passed by Shri Justice S.J.Kathawalla and the findings of the said forensic expert including in respect of four documents in support of her submission that even the said expert found that the signatures of the appellant on those four documents were different than the admitted signatures of the appellant. 72. It is submitted by the learned counsel that this court has stayed the proceedings before the Company Law Board by an order dated 27th March,2014. She invited my attention to various averments made in the company petition filed by her client and also to the grounds raised by the appellant in this appeal. Learned counsel for the appellant placed reliance on the judgment of Supreme Court in case of Uttamrao Shivdas Jankar Vs. Ranjitsinh Vijaysinh Mohite Patil reported in (2009) 13 SCC 131 and in particular paragraph 51 on the issue of waiver of statutory right under section 10F of the Companies Act, 1956 and would submit that there was no waiver on the part of the appellant of the statutory rig....
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....on to the prayers and the pleadings in the company petition filed by Mr.Subhash Chander Gupta (21 of 2010) and would submit that the reliefs claimed by him are different and against different persons. All parties in that company petition filed by him are not the same in the company petition filed by her client. There are additional parties in the company petition filed by the appellant. The interim reliefs prayed by the appellant in the company petition filed by him are also different. 76. Ms.Arora, learned senior counsel for the respondent nos. 1 to 5 on the other hand submits that Nand Lal Gupta Group and Prem Gupta Group are the shareholders in Tara Industries Limited. Learned senior counsel invited my attention to the averments made by the appellant in Company Petition No.70 of 2006 and also in Company Application No.471 of 2012 in which the appellant had inter alia prayed that the documents listed therein be sent for forensic examination and would submit that the said application was made after more than 5 and ½ years of the filing of the documents before the Company Law Board in respect of the documents which were alleged to have been forged. She submits that all thes....
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....l complaint filed by the respondent no.5 in the Court of the Additional Chief Metropolitan Magistrate in July, 2007 against the appellant under sections 628 and 629 of the Companies Act, wherein the documents signed by the appellant in his capacity as the Executive Director of Sabina Woollen Mills Private Limited are in issue. 79. It is submitted that in the said criminal proceedings, the petition under section 482 of the Criminal Procedure Code filed by the appellant for quashing those proceedings has been withdrawn on 1st February, 2010. Subsequently the appeal for discharge has been also dismissed. She submits that in the application filed in the year 2012 by the appellant, he has denied that he was the Executive Director of Sabina Woollen Mills Private Limited. She submits that similar wealth tax returns were also filed by the other respondents. No such allegations of forgery were ever made by the other respondents. 80. It is submitted that the appellant has failed to disclose any material particulars of forgery save and except to state that some of the documents were forged and/or bear forged signature and therefore, should be sent for forensic examination. She submits that ....
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....e year 1991-92 onwards. The other members of the family also had filed wealth tax returns. Mr.Subhash Chander Gupta also filed a similar wealth tax returns disclosing the same rate of market value of shares. She also invited my attention to the wealth tax returns filed by Mr.Subhash Chander Gupta, Mrs.Kiran Gupta and Mr.Prem Gupta for various periods. Reliance is also placed on the minutes of the meeting of the Board of Directors of the respondent no.1. She submits that the appellant has also made various payments to the banks and also towards the tax liabilities disclosed in those tax returns. She submits that most of the documents were already referred to in the affidavit in reply filed by the respondent nos.1 to 5 but were filed along with the sur-rejoinder. The appellant did not ask for inspection of those documents. 83. It is submitted by the learned senior counsel that admittedly the appellant had already taken inspection of the records of the Registrar of Companies relating to the records filed by the respondent no.1. 84. Learned senior counsel placed reliance on the closure report filed by the Investigation Officer on 25th August, 2015 and submits that the said report wou....
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....inancial resources. 88. Insofar as the allegations of appellant that the minutes of the meeting of the Board of Directors were forged and fabricated is concerned, it is the case of the appellant himself that he had taken inspection of the record at the Company Law Board. The appellant has relied upon the financial report and the final statements of the company beginning 1992-1993 until 2004. She invited my attention to the annual returns Form-II, financial statements annexed at various pages of compilation. She submits that the documents annexed by the respondents clearly reflect the extent of the information available with the appellant about the respondent no.1 and thus there was no purpose of filing of those documents when the appellant and his wife had all material information with them about the respondent no.1. 89. It is submitted by the learned senior counsel that the share capital of the company was increased from time to time to meet with its financial requirements to the knowledge of the appellant. The share capital was increased only to meet with the financial requirements of the company, which is established from the material facts and documents contemporaneous with t....
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....g of the company petitions by the Company Law Board so as to ensure that the company petitions were heard and decided expeditiously. By the said order, the delay in filing the Company Application No.471 of 2012 by the appellant was not condoned. She submits that it is an admitted case of the appellant that the alleged fabrication had come to his knowledge as of 18th January, 2007 after the date of filing rejoinder before the Company Law Board however, the appellant waited for more than five and half years to file the company application which clearly establishes the gross delay on the part of the appellant. 94. It is submitted by the learned senior counsel that merely because the matter was referred to mediation on 5th July, 2010, which was pending for a period of one year, it is of no avail and had no bearing on the contention raised in the company application. No action was taken by the appellant either before the matter was referred to mediation or even thereafter for more than one year. 95. It is submitted by the learned senior counsel that the appellant himself had filed a Criminal Complaint No.97/Misc./2008 in the year 2008. The very same documents formed the documents of t....
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.... appellant had alleged that the signatures were forged, he did not furnish information as to whether the original tax returns were prepared by him and were filed. She submits that the report thus submitted by the hand writing export pursuant to an order passed by this Court cannot be relied upon as authentic unless the said private expert is tested through cross-examination. 98. It is submitted by the learned senior counsel that insofar as the statutory records of the respondent no.1 are concerned, the appellant has already taken inspection of the records at the Company Law Board and himself has relied upon the annual reports and financial statements of the respondent no.1. Each of the pages of those documents reflected the knowledge of the appellant and that the information was available with him. She submits that the application thus filed by the appellant for referring some of the documents for forensic export itself was mischievous and filed with an oblique motive with a view to delay the out come of the proceedings filed by the appellant and to enjoy the benefit of the ad-interim ex-parte order obtained by the appellant against the respondent nos.1 to 5. 99. Ms.Meenakshi Aro....
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....page 139 of the compilation of documents showing that the appellant had been issued two pan cards. Reliance is also placed on the said two applications made by the appellant at pages 140 and 145 of the compilation for issuance of two pan cards. She submits that signatures of appellant differ on both these applications admittedly made by the appellant for issuance of two separate pan cards. 102. Learned senior counsel placed reliance on the findings rendered by the EOW against the appellant. It is submitted by the learned senior counsel that the order passed by Shri Justice S.J. Kathawalla was an ex parte order. The report submitted by so called hand writing expert is not binding and conclusive. She also invited my attention to various affidavits filed by the respondent nos.1 and 2 before the Company Law Board in the Company Petition No.109(ND)/2013. 103. Learned senior counsel for the respondent nos.1 to 5 strongly placed reliance on Closure Report dated 24th August 2015 filed by the Investigation Officer opining that the signature of the appellant was differed from time to time. 104. Ms.Singhania, learned counsel for the appellant in rejoinder submits a chart showing the detail....
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....nos.1 to 5 also addressed of the appellant was shown of Mumbai though the appellant was admittedly settled down in Delhi. She submits that apart from the appellant and his wife, some other family members of Gupta family are also disputing the documents. 107. Insofar as the closure report relied upon by the respondent nos.1 to 5 is concerned, it is submitted by the learned counsel that even the said closure report shows inconsistency and does not show correct conclusion. She submits that there is no conclusive report on the signature of the appellant in the said report. The findings are confusing and inconsistent. She submits that in any event since the said closure report has been challenged, the same cannot be relied upon. She submits that it is not the case of the appellant that the report of the hand writing report relied upon by the appellant is final and binding. The order passed by S.J. Kathawalla, J. appointing the said hand writing export is final and binding in view of the fact that none of the parties have challenged the said order. 108. It is submitted by the learned counsel that the respondent nos.1 to 5 have not made any submissions as to how the impugned order passe....
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....e appellant were compiled in Ludhiana but were filed in Mumbai. She submits that the appellant himself has admitted in his affidavit that the tax returns were filed by the appellant as Karta of his HUF in the affidavit filed on 16th December, 1997. He also referred to Voluntary Disclosure Scheme of 1997 which he had availed of as disclosed in the affidavit dated 9th January, 1998. The wife of the appellant had filed an affidavit admitting that the jewelleries were purchased by her. She had also availed of Voluntary Disclosure Scheme. The son of the appellant had also declared purchase of vehicles in Voluntary Disclosure Scheme and had filed the income tax returns which documents were not disputed by the appellant. 112. Learned counsel also invited my attention to the submissions made by Mr.Subhash Chander Gupta in Company Appeal No.14 of 2014 which averments are admittedly confirmed by the appellant. She also invited my attention to a letter addressed by the appellant to the Bank of Baroda annexed at page no.1434 showing five signatures of the appellant on the said letter, which do not match with each other. She also invited my attention to a letter dated 30th March, 2013 from the....
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.... for meeting with the excise demand of over Rs. 16 lakh, threat of penalty and for various other reasons to the knowledge of the appellant and the other shareholders. The appellant, however, neither raised any objection to increase the share capital nor agreed to buy any additional shares offered by the respondent no.1 to all the shareholders including the appellant. It is also the case of the respondent nos.1 to 5 that all such increased equity share capital of the respondent no.1 was duly reflected in the balance sheet of the respondent no.1 from time to time based on which the appellant and his family members had filed their personal income tax and wealth tax returns. 116. In so far as the submission of the learned counsel for the appellant that in the month of February 2006, Mr.Nand Lal Gupta came to India with his family members and met the other family members/ shareholders including the appellant and assured that the appellant would be given equal right in the respondent no.1 company but the said Mr.Nand Lal Gupta resiled from the said commitment and refused to give any information to M/s.Cameo Fabrics Ltd. is concerned, a perusal of the record prima facie indicates that no....
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.... 119. On 9th September, 2012, after the arguments of the appellant and his wife were already concluded and the arguments of the respondent nos.1 to 5 were substantially completed, the appellant filed the said Company Application No.427 of 2007 alleging that the annexures to the counter affidavit, sur-rejoinder and additional affidavit dated 24th November 2011 were forged and be sent for forensic examination. The last affidavit i.e. affidavit in sur-rejoinder was filed by the respondent nos.1 to 5 on 10th March 2007 whereas the Company Application No.471 of 2012 was filed by the appellant after five and half years i.e. on 9th September 2012. The documents which were annexed to the sur-rejoinder were already filed by the respondent nos.1 to 5 in Company Petition No.21/ND/2010 which was filed by Mr.Subhash Chander Gupta and another against M/s.Sabina Woollen Mills Pvt. Ltd. to which the appellant was impleaded as party-respondent no.6 and was fully aware of those documents. 120. A perusal of the averments made in the Company Petition No.70 of 2006 filed by the appellant insofar as the allegations of fraud, forgery and coercion made by the appellant are concerned, it clearly indicate....
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....cation till the arguments of the appellant and his wife were concluded and the arguments of the contesting respondents were substantially concluded in Company Petition No.70 of 2006. At that stage, the appellant appears to have deliberately insisted the Company Law Board to hear the said company application filed by the appellant for impleadment of the Tara Industries Ltd. in Company Petition No. 70 of 2006 which was unwarranted with a view to delay the outcome of the company petition filed by him before the Company Law Board and that also at the belated stage after about above five years. 124. A perusal of the record further indicates that the respondent nos.1 to 5 had referred to and relied upon various statutory returns and minutes of the meeting of the board of directors of the respondent no.1 in the affidavit in reply. The appellant had all the details and particulars of various decisions taken by the board of directors of the respondent no.1 from time to time including the decision for increase in the share capital of the respondent no.1. The respondent nos. 1 to 5 however annexed some of those documents along with sur-rejoinder. The appellant had not disputed similar docume....
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.... Lal Gupta group. Those payments were made by cheques. The appellant could not produce any income tax or wealth tax returns filed by the appellant before this court in support of his allegation of fraud, forgery and fabrication or in support of his case that those returns were filed by Mr.Nand Lal Gupta on behalf of the appellant fraudulently and without his consent. The appellant was also represented by chartered accountants before the assessing officer in respect of those returns as is apparent from some of the assessment orders produced on record. 128. In my view the appellant and his son being advocates, would not have kept quiet for 20 years and would not have permitted Mr.Nand Lal Gupta group to file any statutory returns on behalf of the appellant and that also by forging his signature on those returns and that also without knowledge of the appellant and his family members. If the appellant would have produced some other wealth tax and income tax returns in respect of those assessment years which the appellant would have filed separately, the allegation of fabrication and forgery made by the appellant would have some bearing subject to further scrutiny by the Company Law Bo....
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....ignature. It is not the case of the appellant that Mr.Nand Lal Gupta had forged his signature on the different applications for pan card made by him. 132. One of the document placed on record i.e. the letter addressed by him to the Bank of Baroda annexed at page 1434 of the compilation shows five signatures of the appellant which are different from each other. It is not the case of the appellant that the said application containing five signatures were forged and fabricated by Mr.Nand Lal Gupta. I am therefore of the prima facie view that the signatures of the appellant on various admitted documents signed by him were not matching with each other. In these circumstances, the application filed by the appellant for forensic examination of some of the documents belatedly made was rightly not entertained by the Company Law Board for the reasons recorded in the impugned order. I do not find any perversity in the findings rendered by the Company Law Board in the impugned order and thus no interference with the impugned order is warranted in this appeal filed under section 10F of the Companies Act, 1956. No question of law arises in this appeal. 133. A perusal of the record indicates th....
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....by one of the directors as far back as on 4th January, 1994. The appellant however never proceeded with such allegation of fraud, forgery and fabrication. 137. In so far as the submission of the learned counsel for the appellant that the respondent no.1 is the closely held family run company in the nature of a quasi partnership is concerned, such contention can be raised before the National Company Law Tribunal and can be considered at the stage of final hearing of the company petition. 138. In so far as the submission of the learned counsel for the appellant that the respondent no.1 came under exclusive management of Mr.Nand Lal Gupta based on the mutual understanding between the brothers that he would manage the respondent no.1 for the benefit of all the brothers/shareholders is concerned, in my view, the appellant had not made out a case about alleged breach of such alleged understanding between Mr.Nand Lal Gupta and the appellant. Be that as it may, such alleged breach is not relevant for the purpose of deciding the issue whether certain documents were required to be referred for forensic examination. 139. In so far as the submission of the learned counsel for the appellant ....
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....r to the order passed by the Delhi High Court, the appellant had already taken inspection of the statutory records of the respondent no.1 from the Registrar of Companies on 14th June 2006. Be that as it may, by the said order passed by the Delhi High Court, it was made clear that if any such application would be made by the appellant, the same shall be decided by the Company Law Board in accordance with law. Though the said order was passed by the Delhi High Court on 26th February 2009, the appellant proceeded with the arguments before the Company Law Board without making any such application pursuant to the liberty granted by the Delhi High Court and chose to make such application much after the arguments were concluded and the arguments of the respondent nos.1 to 5 were substantially completed. The appellant thus cannot explain the gross delay in making the application for referring the documents for forensic examination. In my view, the judgment of the Delhi High Court in the case of A.P. Jain Vs.Faridabad Metal Udyog (supra) would not assist the case of the appellant. 142. In so far as the submission of the leaned counsel for the appellant that the minutes of meeting of the Bo....
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....he Magistrate Court at Esplanade, Mumbai. However, no order has been passed by the learned Magistrate in the said petition. The learned counsel for the appellant has rightly placed reliance on the judgment of this court in case of HSBC PI Holdings (Mauritius) Limited (supra) in support of her submission that since the opinion of the Economic Offence Wing had not been accepted by the learned Magistrate at that stage, this Court could not consider the correctness of the report submitted by the Economic Offence Wing at that stage. Be that as it may, both the parties have been relying on the separate forensic report or closure report. This Court need not go into the validity and correctness of these reports in this appeal at this stage in view of this Court having held that the application of the appellant for referring the documents for forensic examination was misconceived and grossly belated. 146. In so far as the grievance of the appellant that the Company Law Board had made various observations on merits of the matter in the impugned order is concerned, it is made clear that the observations, if any, made by the Company Law Board in the impugned order on merits of the Company Pet....