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Judgment
Virendra Kumar Gupta, Member (Technical)
The present Petition has been filed by Mr. Raj Kumar Gupta (director and shareholder of Balajee Polly Printerss Pvt. Ltd.) under Section 98 of the Companies Act, 2013 for convening of extraordinary general meeting under Section 98 of the Companies Act, 2013 (hereinafter referred to as “the Act”).
Brief facts and contentions by the Applicant:
The company Balajee Polly Printers Pvt. Ltd. consists of two Directors and 10 shareholders which is reproduced as under:
S.
No.
Shareholder/Relative
No. of Equity Shares
1
Raj Kumar Gupta [also Director]
2600
2
Sumit Gupta - relative of Raj Kumar Gupta
600
3
Amit Gupta - relative of Raj Kumar Gupta
600
4
Vinay Gupta - relative of Raj Kumar Gupta
600
5
Manju Gupta - relative of Raj Kumar Gupta
600
6
Aparna Garg [also Director]
2600
7
Saroj Mittal - relative of Aparna Garg
900
8
Vijay Mittal - relative of Aparna Garg
500
9
Ajay Mittal - relative of Aparna Garg
500
10
Vipin Kumar - relative of Aparna Garg
500
The applicant contends that in 2013-14 the company purchased a plot bearing address Kharsa No. 417, Village- Ami Nagar, Alis-Bhud Baral, Dist-Meerut, UP measuring 15406.99 sq. yards and to purchase this plot both directors- Ms. Aparna Garg and Mr. Raj Kumar Gupta and 7 other shareholders (except Vipin Kumar) provided unsecured loan to Company. In end of 2017-18, the Respondent (Ms. Aparna Garg) asked for repayment of the loan she had advanced to the company and the Applicant (Mr. Raj Kumar Gupta) enabled the company to repay the loans as requested by Ms. Aparna Garg personally by arranging money from his family members. Both the Directors also discussed that the loan amount advanced to the company shall be repaid out of the sale proceeds of immovable property of the company.
After this payment, the Respondent started avoiding calls of Applicant for repaying loan of Applicant’s relatives, call for meetings, finalizations of accounts for the year ended 31.03.2019 and other income Tax and ROC compliances. The Applicant, who is also the Director of the Company, received mail from RoC, Kanpur for filing of balance sheet and Annual Returns for 2018-19 by mail dated 25.09.2018 as the last annual return was filed by company in 2017-18 to the Ministry of Corporate Affairs [Annexure A-4 at page 61]
The four shareholders of the companies (relatives of the applicant) holding 2400 shares which constitutes 24 % of total share capital of the company sent notice to company under Section 100 (2) of the Companies Act, 2013 to hold Extra Ordinary General Meeting (EOGM) of the company which could not be delivered to the company as other non-applicant Director vacated the premises which belongs to family member and same is registered office of the company which is returned back with remark addressee left without instruction. Copy of the letter/notice sent to the company are annexed and marked as Annexure A-7 at page 115. Agenda to be discussed at extra-ordinary general meeting is reproduced below:
S.
No.
Particulars
1
Chairman- to take chair
2
Grant leave of absence, if any.
3
Discussion on accounts for Finalisation of Balance Sheet, profit & loss Account for the year ended 31st March, 2019
4
Discussion on ROC compliances on various provision of the Companies Act, 2013
5
To Discuss on filing of Income Tax Return
6
To discuss on the matter of repayment of unsecured loan taken by the company
7
Discussion on change of Registered office of the Company
8
Discussion on appointment of Additional Director of the Company
9
Any other matter with the permission of Chairman.
Hence, this present petition for convening of extra-ordinary general meeting under Section 98 of the Act because annual General Meeting has not been held since 2018 which has led to non-compliance of the provisions of Companies Act,2013 and the rules made thereunder.
Contentions by the Respondent:
The Respondent denies all the claims of petitioner and also claims that the applicant was a director of a company named Nik Moulds Private Limited which was incorporated on 10/05/1989 and its name was struck off from register of Companies on 31/3/2017. Hence, according to Section 164 (2) he couldn’t be Director of any company for next five years. He had concealed this fact and thus was ineligible to be director of Balajee Polly Printerss Private Limited [Annexure R-3 on pg. 31].
The Respondent also mentions that the correct name of the company is BALAJEE POLLY PRINTERSS PVT. LTD. and not BALAJEE POLY PRINTERS PVT. LTD. and the incorporation certificate on page 17 of application is not correct. The name of the company was changed to BALAJEE POLY PRINTERSS PVT. LTD. The copy of Certificate of Incorporation is annexed herewith and marked as R-8 on pg. 40
Further it is also contended that Mr. Gupta had fraudulently transferred shares of Mr. Vivek Kumar in his own and Mr. Vivek Kumar has sent a Legal notice for the same to Mr. Raj Kumar Gupta [Annexure R-7 on pg. 37]
Rejoinder filed by the Applicant:
The Applicant in his Rejoinder states that the transfer of shares from Mr. Vivek Kumar to Mr. Raj Kumar Gupta has been done in compliance with law by filing Form 20B, Schedule V for the year 2012-13 [Annexure R-1 on pg. 16]. Also, the list of Shareholders mentions the name of Mr. Raj Kumar Gupta and his family as shareholders and it is signed by the Respondent which shows her consent to the same [Annexure R-2 on pg. 37]. He also contends that his DIN status as shown on e-portal of Ministry of Corporate Affairs is active and hence he is still the Director of the Company [Annexure R-5 on pg. 75].
The Court during the hearing of the case had called for a report by the RoC, Uttar Pradesh to ascertain the financial condition of the Company. The Registrar in his report mentioned his inability to help ascertain the financial condition due to non-filing of Annual Returns and Financial Statements by the Company after the year 2018.
Findings and Conclusions:
In view of the facts and contentions stated above, it is imperative that the statutory compliances be done by the company in a prompt manner. So convening Extraordinary General Meeting (EOGM) is justified. Therefore, we accept the application of the applicant and though the proviso under Section 98(1) requires only one person to constitute meeting yet as an exception we direct that 4 members shall constitute quorum in this case.
The other three reliefs prayed by the applicant in the petition are reproduced as under:
i) Pass orders for appointing an independent director/administrator for convening Extra Ordinary Meeting of the Company under Section 98 of the Companies Act, 2013;
ii) Allow appointment of Shri Amit Gupta or such other person as may be appointed by Hon’ble Tribunal as Director of the Company;
iii) Pass orders for appointing an observer who will co-ordinate non-applicant Director and Auditor of the Company for the purpose of finalization of account.
In view of the facts and contentions stated above, these three reliefs do not fall within the scope of Section 98 of the Act and hence, we decline to entertain the same.
It is pertinent to note that the name of the company as written in the petition by applicant and henceforth in the cause list of Tribunal was erroneous, but it is a mere typographical error and should be read as BALAJEE POLLY PRINTERSS PVT. LTD. which is its correct name.
In the result, this present petition is allowed and disposed of in terms indicated above.
The Registry is directed to send e-mail copies of the order forthwith to all the parties inclusive of the Counsel.
Urgent certified copies of this order, if applied for, are supplied to the parties upon compliance of all requisite formalities.