TaxTMI 
TaxTMI 
2019 (8) TMI 999
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....as he diverted funds and mismanaged the affairs of the company. (d) To surcharge respondent No. 2 for his misdeeds and omissions in the company and to direct him to make good the losses suffered by the company. (e) To recast and to re-audit the accounts of the company for the past five financial years. (f) Such other reliefs as the Bench may deem fit. 2. The brief facts of the case, as mentioned in the company petition, are as follows : (a) M/s. Bindu Labels P. Ltd. (hereinafter referred to as company) was incorporated on January 8, 2002 by Puttanarayanappa Nadikeraiah (petitioner No. 1), Nagaraj Puttanarayanappa (respondent No. 2), Thrimur thy Puttanarayanappa (petitioner No. 2), Puttanarayanappa Indira (peti tioner No. 3) and Kenchamma Puttanarayanappa (petitioner No. 4) sub scribed and paid-up capital of the company, at the time of incorporation, was Rs. 2,00,000 (rupees two lakhs only) divided into 20,000 equity shares of Rs. 10 each, out of which each petitioner held 1,500 equity shares of Rs. 10 each thereby aggregating to Rs. 15,000 each and totalling to 6,000 equity shares of Rs. 10 each aggregating to Rs. 60,000 and 30 per cent. of th....
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....d a wall for his portion. He has filed a civil suit vide O. S. No. 6071 of 2014 in the court of the additional city civil judge, without giving any prior notice to any of the petitioners, and brought a temporary injunction order from the court that the petitioners should not disturb the peaceful enjoyment of the property by the company. Respondent No. 2 came to the factory premises with the copy of the order, and started threatening all the workers that they should not obey the orders of the second petitioner Mr. Thrimurthy Puttanarayanappa. (e) Further, the respondent gave instructions to the stores department not to issue any material to any of the petitioners. This in turn it has affected the production of the company, stoppage of work, loss of revenue, client base and thereby reducing the turnover and goodwill of the company. This act is prejudicial to the interest of the company, customers, employees and all other connected with the company. When the respondent rejected to provide any information even on the statements of the bank account, the petitioners approached the Syndicate Bank, Rajaji Nagar, Bangalore with whom the account in maintained, requesting to issue th....
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.... 2014. (j) Mr. Nagaraj Puttanarayanappa is mismanaging the affairs of the company as he is at all holding any board or shareholders meetings and is preparing documents as if the meetings were held and which can be evidenced from 2013 financial statements annexed. The petitioners have never signed any attendance reports for attending board meeting or the share holder meeting of the company. Further it is alleged that he was siphoning off funds of the company by over invoicing for purchases made by the company and collecting money from suppliers or paying them money for materials not received and collecting back the monies paid after giving the suppliers commission. As petitioner No. 2 is in charge of production, he knows that materials described as received in invoices were never received or unused in the production in the company. Thus, there is financial mismanagement, which goes against the interest of the company this is a case deserving investigation into the affairs of the company. The respondent Mr. Nagaraj Puttanarayanappa is misusing his position as director as the other directors are not well literate. As the petitioners, even though are promoters and first direct....
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.... Bindu Printers. The business of the said concern was to print labels. Subsequently, the second respondent changed the name of the proprietary concern the Bindu Screens. With a view to support his sister (petitioner No. 3) the second respondent began a partnership venture with petitioner No. 3 in the name of Bindu Graphics. Being the eldest son in the family, the second respondent decided to shoulder the family responsibility and gave his family members an interest in the first respondent-company, which came to be incorporated on January 8, 2002. The first respondent-company has sales turnover of more than 11 crores, as evidenced by the audited balance-sheet and profit and loss account for the year ended March 31, 2013. The first respondent has obtained as ISO Certification and has established itself as a reliable supplier of adhesive labels, membrane switches, IC Printing in the market. (f) The first respondent-company is in occupation of the factory premises constructed on property bearing Nos. 54, 55 and 56, Srigandha Kavalu, Sunkada Katte, Bangalore as a lessee. The property, on which the registered office and factory are situated, is owned by the second respondent and....
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....11] 167 Comp Cas 434 (Karn), and upheld by the hon'ble Supreme Court). The second respondent reserves his right to invoke section 397 against the petitioners in appropriate proceedings. The second respondent has already been constrained to lodge a complaint with the Regional Director under section 16 of the Companies Act, 1956 praying that suitable directions may be issued to Bindu Labels (India) P. Ltd., to change its name by deleting the words "Bindu Labels" from its name. (h) The second respondent was further shocked to receive a copy of the notice dated August 19, 2014 convening a board meeting on August 27, 2014 along with the agenda for the board meeting proposing to convene a board meeting of the first respondent-company on August 27, 2014 at the residence of petitioners Nos. 1, 2 and 4 situated at No. 561, Vinayaka Lay out, Meenakshinagar, K. H. B. Colony, Bangalore-560 079, rather than convening it at the registered office of the company. By a letter dated August 23, 2014 addressed to the board of directors of the first respondent- company, the second respondent dissented to holding of the meeting at the residence and also stated that the notes on the agenda w....
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.... Labels P. Ltd." and has started diverting the orders from the first respondent-company, it is stated denied that the said contention is wholly bereft of merit. Shreeambe Labels P. Ltd., is a company incorporated in Mysore, in which the second respondent is a 60 per cent. shareholder. The said company's business is only the automotive sector, and it does compete with the first respondent-company. There is no overlap between the work undertaken by the first respondent-company and Shreeambe Labels P. Ltd. 4. Heard Ms. P. Dakshayani, the learned practising company secretary for the petitioners, and Shri S. Sriranga, along with Shri Pradeep Darak, learned counsel for the respondents. We have carefully perused the pleadings of both the parties along with material documents filed in their support and law as cited by the parties. 5. Ms. P. Dakshayani, the learned practising company secretary for the petitioner, while reiterating of the contentions raised in the company petition, has further contended that the second respondent still continuing the acts of oppression and mismanagement in the affairs of company, while the instant case is still pending. Therefore, it is a fit case ....
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.... petitioners also directors of the company. As per article 12 of the articles of associations, the following shall be the first directors of the company upon incorporation of the company : (a) Sri Nagaraj Puttanarayanappa (respondent No. 2) (b) Sri Thrimurthy Puttanaryanappa (c) Sri Puttanaryanappa (d) Smt. Kenchamma (e) Smt. Indira Puttanaryanappa They are permanent directors of the company and they are not liable for retirement by rotation except by way resigning his/her office or dies. 8. The powers of board of directors and procedure to be adopted for convening and adopting resolution, etc., are dealt with under articles 37, 38 and 39 of the articles of association of the company, which reads as under : (a) The managing director and/or chairman on requisition of any director shall summon the meeting of the board of directors at any time subject to section 285 of the Companies Act. (b) At the meeting of the board of directors, all matters shall be decided by majority of votes. In case of any equality of votes, the chairman of the meeting shall have a second or casting vote. (c) The director in their me....