TaxTMI 
TaxTMI 
TaxTMI 
2021 (6) TMI 950
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....orporated under the provisions of Companies Act, 1956 on 13.12.2005. This company carries on business in the field of heating, ventilation and air conditioning. The Appellant holds 5000 equity shares of Rs. 10 each constituting 50% of the shares of the company. The rest 50% shares of the company are owned by Suraj Mani (Respondent No. 2), who is married to the Appellant. Suraj Mani and his friends were shareholders in a company called M/s Ambient Systems Pvt. Ltd., which had its registered office in Kerala, and was engaged in the business of taking work contracts for installation of air conditioners. The Appellant and Respondent No. 2 were married in the year 2000. As part of investment, Respondent No. 2 and other shareholders of M/s. Ambient Systems Pvt. Ltd. invested Rs. 1,50,000 as working capital in that company. The Appellant claims to have infused Rs. 1,50,000 on behalf of Respondent No.2 in the said company. Later, Respondent No. 2 took over the Bengaluru branch of M/s Ambient Systems Pvt. Ltd. and the business of this company was split. Out of this split Respondent No. 2 received Rs. 15 Lakhs towards his share. 3. Thereafter, Appellant and Respondent No. 2incorporated Resp....
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....of management of Respondent No. 1 company secret from her and never made available to the Appellant the financial records of the Respondent No. 1Company for review despite her requests. She has stated that in the board meeting held on 29.3.2018 her objections made in the meeting were not considered for inclusion in the minutes of this meeting. According to her, it was decided in this meeting to give to Respondent No. 2 an amount of Rs. 1.20 Crore and Respondent No. 3 an amount of Rs. 60 Lakhs as incentive. These actions, according to her, are highly discriminatory and meant to harm her position in Respondent No. 1 Company, which amounts to her oppression and mismanagement of the company. She has also alleged that she was not paid her due salary from March 2018 and therefore she had to approach the National Company Law Tribunal, Bengaluru for redressal of her grievances. This petition has been dismissed by NCLT and hence she has come in appeal. 7. We have carefully gone through the appeal memo, the replies of the respondents and the rejoinder of the Appellant thereon. We have also considered the written submissions of all the parties and heard and carefully considered detailed oral....
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....ich was done to reduce the percentage of the shareholding of Appellant so that it would then become insignificant. She has also claimed that on 20.3.2020, Respondent No. 2 and Respondent No. 3 received variable salary to the tune of Rs. 2.4 crores and there have been also some other payouts amounting to Rs. 4 crores, which were approved by the board. Such payouts show that there is no problem of liquidity in the company and hence, there is no reason why the authorized share capital of the Respondent No. 1 company should be raised for taking care of its expanding business activities. She has contended that the increase in authorized share capital is a ploy to reduce her shareholding from 50% to less than 1% which amounts to her oppression and mismanagement by Respondent No. 2. 11. The Ld. Counsel for Appellant has provided the following citations in support of her case: (i) Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan and Ors. [2005(1) SCC 212]. (ii) M.S.D.C. Radharamanan Vs. M.S.D. Chandrasekara Raja and Anr [2008 (6) SCC 750]. (iii) Ms. Heena Dutt v. Chavi Designs Pvt. Ltd. &Anr, [2008 (141) Comp Cas 172 (CLB)]. 12. What appears from Judgment of Hon'ble Supreme ....
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....ce. 15. The Appellant has at no place been able to show how various commercial decisions taken in board meetings of the company Respondent No.1 company were devoid of commercial wisdom and detrimental to her position as a shareholder of the company affecting the financial health of the company. All that she has been able to show is her demand for certain earlier benefits which she was seeking to preserve. 16. The Ld. Counsel representing Respondent No. 2 and other Respondents has argued that Respondent No. 2 is the founder and driving force behind the Respondent No. 1 Company Suraj Mani Engineers Pvt. Ltd., which bears his name. Respondent No. 2, Suraj Mani is a mechanical engineer with over two decades of experience in the area of business of Respondent No. 1Company. The Ld. Counsel has stated that in 2005, when Respondent No. 2 started Suraj Mani Engineers Pvt. Ltd., the Appellant was on a "break" and had stopped working(Page 25 of Appeal). Therefore, she was made a Director with 50% shareholding in the company. The Learned Counsel for Respondents has also stated that the Appellant's role in the company has been of a sleeping partner and she has neither made any financial contr....
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....he new company, thereby contributing to mismanagement of Respondent No. 1 Company does not appear to be well founded. Her allegation, that this new company was incorporated to divert the business of Respondent No. 1 Company in order to reduce the profits of Respondent no. 1 Company and thereby decreasing the share of profits that would accrue to the Appellant, is also not borne by facts. In fact, the argument of Respondent No. 2's Ld. Counsel that while a new company was incorporated, no new business was diverted from Respondent No. 1 Company to Respondent No. 4 Company and even now, Respondent No. 4 Company does not have any significant business is plausible and strikes at the base of Appellant's allegation. The Appellant's Learned Counsel has not given any facts or evidence about diversion of any business from Respondent No.1 Company to Respondent No. 4 Company. Therefore, we are not convinced by the argument of the Appellant that the new company (Respondent No. 4) was incorporated to divert business from Respondent No. 1 Company which was a move to oppress her. 21. Another instance of mismanagement and oppression cited by the Ld. Counsel for Appellant that Respondent No. 2 rela....
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....00,000. In reply, the Respondents have said that this was merely a proposal. The impugned order was passed on 1.8.2019and this proposal was approved in the EGM of Respondent No. 1 Company on 3.8.2019 i.e. two days after the Impugned Order was pronounced. Mainly because Authorized Share Capital after following procedure is increased, the act cannot be branded as oppression. 24. We have noted that Respondent No. 1 Company has performed consistently well and there has been an increase in revenue and turnover of the company over the years (as shown by table at page 5 of the Respondent No. 2's counter affidavit. This point has been mentioned in NCLT's impugned order dated August 1, 2019 (page 67 of the appeal) and not disputed by the Appellant. The reference made by the Respondents to the applications filed and representations made by the Appellant including those for interim relief sought before NCLT, mainly requesting for a residence to be provided to the Appellant and also for payment of credit card bills of the Appellant go to show the personal nature of allegations calling the same oppression of the Appellant and mismanagement of company's affairs. In the circumstances of the case....