TaxTMI 
TaxTMI 
2022 (1) TMI 324
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.... 2) Direct the respondents not to restrain the petitioners from the company premises. 3) Direct the 2nd and 3rd respondents not to take any action restraining petitioners taking charge as directors of the said company. 4) Direct the appointment of respondents 2nd and 3rd as null and void. 5) Allow the petitioners to perform all the duties as directors of the said company. 2. The Company Lamcy Enterprises Private Limited was incorporated on 03.05.2013 as a Private Limited Company and registered under the Companies Act, 1956. The registered office of the Company is at NMC-12/465(5,6&7), Surya Road, Nedumangad-695541. The main objects of the company are as follows: - To carry on all or any the business of general merchants. traders. suppliers. importers. stores, storekeepers, removers, packers, distributors. manufacturers' representative's Commission. franchisors. and or in any other capacity, and dealers in, and to buy render, marketable. Sell, Barter, exchange, pledge, charge, make advances on and otherwise deal in or with or turn to account by wholesale or retail goods. General merchandise and other commodities of all kinds and descriptions. 3. The authorized share capit....
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.... that the petitioners are lessees of the property in which the company is carrying on its business by a registered lease deed for 10 years. The respondents are owners of the building. The 2nd respondent who obtained an exparte injunction order dated 14.01.2020 is now trying to usurp the company from the petitioners. It is also argued that the loan availed by the company on the security of the property is left unpaid. It is further argued that due to non-maintenance of the cash credit account with Federal Bank Ltd, it became NPA and the bank has initiated legal actions against the company and guarantors. 9. Even though notice was served, Respondent No.1 did not appear. The Respondent Nos. 2&3 filed their counter opposing the petition stating that the petition has been filed by the 2nd petitioner who holds no shares in the 1st Respondent Company, hence, he has no locus standi to file this case. 10. It is further stated that 2nd respondent entered into the business of the 1st Respondent Company by the instigation from the 1st and 3rd petitioners as they have sufficient knowledge in the textile business. The 1st and 3rd petitioners expressed their desire to withdraw from the business....
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....nd 3rd respondents. The second agenda is the appointment of new directors. These agendas require compliance of Section 169 of the Companies Act,2013. In the meeting, the Petitioner has misused the digital signature of the 3rd Respondent and inducted 1st and 3rd petitioners, namely Chandra Sajumohan Mohanan Nair and Biju Jayapalan Nair into the company as Additional Directors. The 3rd respondent, was not in India at the time of the filing of DIR-12 by the petitioners. The said form was digitally signed using DSC of the 3rd respondent, who as per the EGM resolution was removed. The statutory attachments as per rules have not been filed along with DIR 12. The meeting without giving notice to 2nd and 3rd respondents is not valid and the resolutions passed at the meeting are not binding on them. The petitioners have fraudulently filed DIR-12 to appoint new directors as per the impugned EGM held 28.12.2019. The certifying professional (chartered accountant) misused the DSC of 3rd respondent even though 3rd respondent has not given any authorization to do so. Hence, the 2nd Respondent has filed a complaint before Registrar of Companies, Kochi. 14. The first respondent company is the less....
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.... is also not maintainable on the ground that 2nd and 4th Petitioners are unlawfully appointed Directors/ Additional Directors who have no locus standi. The provisions of Section 241 of the Companies Act allow a petition to be filed only by a member of the Company whereas here the unlawfully appointed Director/ Additional Director, 2nd Petitioner has represented himself on behalf of the other Petitioners. All these would show that the Petitioners have no real bonafide intent to run the Company nor to resolve the subsisting issues amicably. Their only intent seems to be to distress the Respondents by indulging in frivolous and baseless litigation. FINDINGS 19. We have heard the learned counsel appearing for both parties at length and considered the voluminous documents placed on record. We have also gone through the relevant case laws cited by both parties. 20. According to the 1st and 3rd petitioners they are the majority shareholders of the company. They entered into a Share Purchase Agreement on 15.01.2019 with Respondent No.2. But 2nd Respondent failed to fulfil their part. Hence, the agreement could not succeed. Respondents' contention is that 1st and 3rd petitioners have def....
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....business activities. The petitioner's appointed Mr. Chandra Mohanan Nair, Mr. Saju Mohan, and Mr. Biju Jayapalan Nair as Directors. 22. Thereafter, the litigation before the Civil Court and further before this Tribunal has started. The main issue is the Agreement executed between both the parties could not be honored on time. It is admitted that the major portion of the equity shares (2/3rd) are held by the petitioners and 2nd Respondent holds only 1/3rd of the total shares. It appears from the records that when the 2nd Respondent did not honor the commitments in the agreement, 1st and 3rd petitioners removed the 2nd and 3rd Respondents from the directorship without giving an opportunity of hearing to the 2nd and 3rd Respondent being majority shareholder. Another allegation of the Respondent is that the DSC of the 3rd Respondent, who as per the EGM resolution was removed on 28.12.2019 was used while filing DIR12 before the Registrar of Companies, appointing Mr. Chandra Saju Mohan Mr. Mohanan Nair and Mr. Biju Jayapalan Nair into the company as additional directors of the company. 23. With regard to shareholder's oppression, the discussion would revolve around the oppression of a ....
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....lowed to bring what is known as a minority shareholders' action on behalf of themselves and all others." 25. We are of the considered view that majority shareholders are expected to exercise their voting powers to self-remedy, before relying on any statutory provisions to protect themselves from oppression by the minorities. The statutory relief for shareholder's oppression is available to majority shareholders who are not in control of the management of the company and who, for any given reason, are unable to control the board. The remedy for shareholders' oppression is also available to majority shareholders, the court would only exercise its powers to remedy, in instances where the majority shareholders are unable to rectify the oppression themselves. The shareholders must show that there exist some special circumstances rendering their majority shareholding powerless, against the oppressor. 26. In the article Reverse Oppression and Shareholder's Commercial Unfairness Remedy (2015), the author explained that statutory remedies for oppression are merely residual in nature, to fill any gaps in which the shareholder is unable to remedy themselves. 27. In the instant petition, p....