AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (10) TMI 891
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.... No.1/Company was incorporated on 17.10.2012. The shareholding pattern of the Company are as follows extracted from Memorandum of Association & Article of Association of R-1: (b) The business of one M/s Thermotech Synergy Pvt. Ltd. was transferred to Respondent No.1 Company. The transfer of the business is in fact admittedly on record. Mr. Bhupal Prasad Verma (Father of the Appellant) held 44% shares R-2 held 16% shares and R-3 held 13% shares in the said company. (c) The Appellant's experience in the steel sector was the basis of the development of the Respondent No.1 Company business. R-2 and 3 were having no experience of the business model carried in R-1 Company. R.No. 2 and 3 were initially opted into the business of Thermotech Synergy Pvt. Ltd. and subsequently in R-1 Company also due to friendly relations and both of them were also aligned in other business ventures carried along with the Appellant. (d) The dispute erupted in the year 2016 due to taking over some other business by Respondent No.2. (e) The dispute arose on account of hijacking of one Ascent Infrabuild Ltd. carrying Crusher Business wherein all the parties are equal partner including Respondent No.....
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....tered post. The Appellant controverts the said statement of Respondent No.2 and humbly submits this Hon'ble Bench to call upon the proof of service to corroborate the narration as made by Respondent No.3. (k) The Appellant also challenges the collusive act of Respondent No. 2 and 3 for conspiring, illegally acting in concert with a malign objective to throw out and deprive the Appellant from the affairs of Respondent No. 1 Company and also to jeopardise the vested commercial interest of the Appellant held in Respondent No.1/Company. (l) The notice calling EGM is bad in law and liable to be declared as null and void on the following grounds: (i) No notice of Board Meeting called and Convened for taking note of the requisition dated: 03.05.2018. (ii) It is pertinent to mention here that special notice to be given under Section 115 of the Companies Act, 2013 must disclose the specific grounds with all supported information on which the director is proposed to be removed, as disclosure of the ground of removal is of substance and not of form because the director concerned is entitled to make a representation against the removal. This disclosure then only gives the Board of ....
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....pointment of, and the fixing of the remuneration of, the auditors; and (b) in the case of any other meeting, all business shall be deemed to be special: Provided that where any item of special business to be transacted at a meeting of the company relates to or affects any other company, the extent of shareholding interest in that other company of every promoter, director, manager, if any, and of every other key managerial personnel of the first mentioned company shall, if the extent of such shareholding is not less than two per cent of the paid-up share capital of that company, also be set out in the statement. (3) Where any item of business refers to any document, which is to be considered at the meeting, the time and place where such document can be inspected shall be specified in the statement under sub-section (1). (4) Where as a result of the non-disclosure or insufficient disclosure in any statement referred to in sub-section (1), being made by a promoter, director, manager, if any, or other key managerial personnel, any benefit which accrues to such promoter, director, manager or other key managerial personnel or their relatives, either di....
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....hareholder on these funds. The said objectives can be easily achieved if the Appellant is removed from the board of directorship. (p) NCLT failed to took notice of the fact that an FIR No. 0049 of 2019 was registered not only against the Appellant but also against Respondent No. 3 at the instance of Respondent No. 2. The said FIR was registered consequent to the compliant of Respondent No. 2 alleging forgery and also complaint under SCST Act, 1989. The matter is still under investigation. The Hon'ble NCLT further failed to take notice that Respondent No. 2 reconciled with Respondent No. 3 and they together conspired and hand in gloves to oust the Appellant from the Respondent Company. (q) It is further a fact in issue that in case the proposed removal of the Appellant was prompted and had arisen on account of the said FIR, then for what reason Respondent No. 3 was exempted. In the present case both Respondent No. 2 and 3 are acting in concert against the interest of the Appellant in Respondent No. 1/Company. (r) The referred FIR No. 0049 of 2016 registered under SC/ST Act Investigation is going on since 2016. No charge sheet is filed yet. Respondents misled Hon'ble NCLT. ....
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....bservations & Findings (I) Several expenses were booked and payments released in cash without maintaining proper supporting bills payment, receipts. For example, - Worker Fooding & Refreshment - Guest House Exp - Conveyance - House Keeping Exp. - Mess Exp. - Safety and Tools - Business Promotion - Manpower Mobilization expenses (Bhatia, JSW) - Site expenses (Bhatia) (II) Payments amounting to Rs. 362.28 lacs were made in respect of which no satisfactory explanation were provided by the accounts keeping staff and onsite staff responsible for releasing payments after verification of bills and approval of Mgt. Such payments were clubbed under Suspense Head. (III) There were instances of serious breach of Section 40 A(3) of the Income Tax Act, 1961 whereby to check the misutilisation of cash and to ensure that the payments are made to genuine persons, all payments exceeding Rs. 20,000 are to be made only through a crossed cheque or a crossed bank draft. Further, there was no system in place of obtaining payment receipt/acknowledgment from the vendor/suppliers to whom such self-cheques issued. O....
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....delay in filing of statutory documents of the company. This has been further delayed as the documents are being perused by the Hon'ble High Court of Jharkhand. However, with a change in law that delayed returns cannot be filed after 31st March 2018, it is imperative to take a call as to what needs to be done. Item No. 7: To discuss and decide the appointment of Forensic Auditor. In view of the financial irregularities reported in the Special Audit Report and on consideration of irregularities in current banking operations, the Board observes that the situation demands that an exhaustive forensic audit and investigation should be carried out by an independent agency. The resolution to be passed at the ensuing Board meeting for appointment of a Forensic Investigator. Item No. 8: To consider and take call on the present and future projects of the company. To find the best way to take the company forward so that there in unhindered growth of the company and to eliminate any possible threats for the future development of the company. Item No. 9: To consider and discuss any item, if any, with the permission of the chair. Agenda for 21.03.2018 Item No. 1: Grant Leave ....
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....only defrauded the company but has in abuse of his fiduciary position, diverted valuable business of the company into his own firm by the name of M/s. TSPL Coke and Energy and the Respondents were unknown about the new commencement of firm owned by the Appellant which is as identical as Respondent No.1 Company. (n) On or around April 2018, the Appellant has successfully diverted the business of the Company by undertaking work order from eminent client like Jindal Saw Ltd. & Bhatia Coke & Energy Ltd. and employing same deceptive tactics to his firm M/s. TSPL Coke and Energy. (o) The Appellant upon receipt of the Special Notice dated 16.05.2018 neither bother to send his representation against the EGM Notice to the Board nor came forward to repudiate the disputes against discrepancies in accounts of the Respondent No. 1 Company. Nevertheless, the Appellant approached before the NCLT on grounds of Oppression and Mismanagement against the Respondents. 4. The Adjudicating Authority has observed in its order dated 03.09.2019 as follows: "6. After hearing the arguments advances by the Ld. Counsels, this Bench is of the opinion that the EGM, having been requisitioned at t....
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....& Mismanagement has been made out as alleged by the petitioner. The petition is dismissed with the notional costs of Rs. 25,000/-. Interim order restraining the removal of the petitioner as a Director is hereby vacated". 5. We have carefully gone through the pleadings of the parties and extant provisions of the Act including their written submissions and we are having the following observations: a) It is not in dispute that the Appellant was the Director of the Company and he is son of one of the promoters of the R-1/Company. b) It is also not in dispute that the Appellant has not been removed from the Company. c) It is also not in dispute that this is a case of friendly relations while coming into the company, has become now an unworkable condition because of several allegations against the Appellant. d) In special audit carried out by Vikas Dahiya and Company, Chartered Accountants, New Delhi vide its Special Audit Report dated 24th May, 2017 has observed multiple irregularities during the Financial Year 2013-14 to 2016-17. The auditor has also observed that huge payments were released in cash without supporting vouchers, receipts and payment amounting to Rs. 3.62 ....
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....e various allegations raised in the special notice but no cognizant explanation was offered against the discrepancies in the accounts of the Respondent No.1 company. h) On further scrutiny, it is also observed that there have not been any irregularities in convening of EGM for removal of the Appellant. The removal of the Director is in the hands of the Shareholders depending upon the eventuality. i) Hence, we do not find any irregularity in the impugned order. We, therefore, constrained to uphold the impugned order. The Appeal, therefore, deserves to be dismissed and is dismissed. No order as to costs. ============= Document 1 144 Weathe several persons, whose names and addresses are subscribed are desirous of being formed into a Company, In pursuance of these Articles of Association and we respectively agree to take the number of shares in the capital of the Company sat opposite to our respective names. Names, Addresses, Descriptions and Occupation of Subscribers PANKAN KUMAR S/O SHRI-Norest prese B. 25/11 Remprestatorony Casiya hew Lun Occupe4bBusines ABHISHEK KUMAR RAM SHANKAR DAYAL KESARI "Sun" off. INDIRA POLAGE HIN....