BEFORE THE COMPANY LAW BOARD, PRINCIPAL BENCH, NEW DELHI

                                                               

                                                                                                                                                CP NO.46 of 2002

 

In the matter of the Companies Act, 1956 Section 397 and 398

                                                            AND

In the matter of Goodwill Plastchem Pvt. Ltd. having its Regd. Office at House NO.35, Vill. And P.O. Jaunti, Delhi-110081.

                                                            AND

 

In the matter of:

  1. Mr. Jagdeep Rajain
  2. Mrs. Sunita Rajain
  3. Mrs. Sushila Ahlawat                                                    … Petitioners

Versus

 

  1. Goodwill Plastchem Pvt. Ltd
  2. Mr. Sanjay Chhikara                                                    …Respondents

 

Present on behalf of the parties:

1. Mr. Sushil Kaudinya, Chartered Accountant                          ..For petitioner

2. Mrs. Anita Kaudinya, Company Secretary                                        ..For petitioner

3. Mr. Arun Mehta, Chartered Accountant                                            ..For respondent

 

 

                                                O R D E R

 

  1. The above mentioned petitioners have filed the petition under Section 397/398 of the Companies Act, 1956 against respondent company M/s Goodwill Plastics Pvt. Ltd. as well as against Mr. Sanjay Chhikar.  The company was incorporated on 13.9.1996 as a private company limited by shares having regd. office at House NO.35, village and P.O. Jaunti, Delhi-110081.  The authorized share capital of the company is Rs. 1 lakh divided into four 10,000 equity shares of Rs. 10 each .   The company was incorporated with the object to carry on the business of manufacture, process, buy, sell , import or export or otherwise dealing all kinds of plastics granules  etc.  The  subscribers to the Memorandum of Association of the respondent company were the following persons who initially agreed to take number of shares in capital of the respondent company as indicated opposite to their respective names:-

Name                                       No. of Shares               Amount Received

a)      Mr. Sanjay Chikara                              10                    Rs.100

b)      Mr. Jagdeep Rajain                              10                    Rs.100

c)      Mrs. Sushila Ahlawat                            10                    Rs.100

d)      Mrs. Sunita Rajain                                10                    Rs.100

---                    ---------

            Total                                                    40                    Rs.400

  1. The petitioners have stated that the company is not carrying on any business at present.  The company had two directors who have been named in the article no.20 of the Article of Association of the respondent company.  It is further stated that there is no change in the  shareholding and directorship of the respondents company.  The annual general meeting of the company has not been held and an application by way of petition to call such meeting has been made.  According to the petitioners, at the time of incorporation of the company it was the understanding between the promoters that second respondent namely, Mr. Sanjay Chhikara , a director and shareholder of the company will look after the day to day business of the company because the other director Mr. Jagdeep Rajain is an agriculturist and the other two shareholders are housewives. 
  2. The company purchased a land measuring 967 yards situated at Gurgaon, Jhajjar Road, Haryana in Oct. 1996 for the purpose of setting up a  factory there.  The payment of Rs. 1,94,000 to purchase the said plot was made by shareholders in the following manner:-

a)`  Mr. Sanjay Chhikara                                        Rs.45,000

b)   Mr. Jagdeep Rajain                                          Rs.49,500

c)      Mrs. Sunita Rajain                                            Rs.50,000

d)      Mrs. Sushila Ahlawat                                        Rs.50,000

  1. The petitioners  have stated that the second respondent illegally convened a Board Meeting without giving or sending any notice of this meeting to the first petitioner namely, Mr. Jagdeep Rajain who is also one of the director out of  total two directors of respondent company and allotted 2500 further equity shares to six new persons as under:-

Name                                                   No. of Shares

a) Mr. Ashok Until                                                       1000

b) Mr. Gurdeep Until                                                    1000

c) Mr. Mahesh Yadav                                                  100

d) Mr. Rao Virender                                                     100

e) Mr. Gagan Deep                                                      150

f) Mr. Amit Rana                                                          150

                                                                                    ____

                                                Total                            2500

  1. It is further stated that in the same Board Meeting, two more directors namely, Mr. Ashok Until and Mr. Gurdeep Until were appointed and the petitioner came to know this illegal act of the second respondent while making the inspection of documents filed with the Registrar of Companies, NCT Delhi and Haryana.  The petitioners have further stated that the second respondent although never formally appointed as MD of the company almost behaved like the MD of the company.  The second respondent failed to convene either the meeting of the Board of Directors or the General Meeting of the company since Sep. 2000.  Hence the first petitioner called a meeting on 12.10.2000 to discuss the situation and the plan for the future.  The second respondent Mr. Sanjay Sikara also attended the meeting but due to adamant behavior no concrete result was derived from the meeting.  The first petitioner also called an EOGM of the shareholders of the company in terms of Article number 11(2) of Articles of Association of the company on Saturday the 29.5.2002 to discuss the situation but Mr. Sanjay Chhikara did not come for this meeting.
  2. The petitioners have mentioned that they have every right to have the affairs of the company managed properly otherwise they will suffer irreparable injury.  Accordingly, the petitioners have prayed that the appointment of two directors and allotment of further 2500 equity shares in the Board Meeting dated 05.03.2001 be declared as void and directions should be given to allot shares against the application money received from the existing shareholders in the company.  The petitioners have also requested for the damage sustained by them for the wrongly acts of the second respondent.  The petitioners have further prayed that “the second respondent be asked to either to sell off his shares to the rest of shareholders and resign from the directorship of the company or purchase all of the shares of the company along with one or more other person and run the company on his own along with new Board of Directors.”
  3. The respondents on the other hand have submitted that Shri Sanjay Sikara has paid Rs.1 lakh to Shri Jagdeep Rajain/Smt. Sunita Rajain by issue of a cheque favouring M/s V.S. Building Materials Suppliers on 8.6.98.  The respondents have further said that Shri Sanjay Chhikara has no business dealings with Mr. Vijender Kumar son of Shri Raghbir Singh and the cheque of Rs. 1 lakh was issued only on the directions of Shri Jagdeep Rajain of Smt. Sunita Rajain being Rs.50,000 as premium to each of them. The respondents have based their arguments on the relationship of these persons as Shri Vijender Kumar, Son of real brother –in-law of Shri Jagdeep Rajain and Shri Sanjay Sikara is related to Sh. Jagdeep Rajain, who in fact is related to Shri Vijender Kumar. 
  4. On repeated demand even from the bench, the learned counsel for respondent has not been able to produce any documentary  evidence to the effect that the payment of Rs. 1 lakh made to M/s V.S. Building materials and suppliers on 8.6.98 was paid as premium to the shareholding of Shri Jagdeep Rajain and Smt. Sunita Rajain .
  5. The next issue is the appointment of Shri Gurdeep Until and Sh. Naresh Until as directors and allotment of shares for Rs.25,000 and handing over of cash of Rs.25,000 to Shri Jagdeep Rajain on 5.3.2001 and further allotment of shares  for Rs. 74600.00 and handing over of the cash  of Rs. 74,600.00 to Sh. Jagdeep Rajain on 13.7.2001.  Here again the respondents have not placed any documentary proof  on record  about the allotment of shares and the money paid etc. 
  6. The third point is the holding of Board of Directors of 21.7.2001 for closure of bank account with Punjab National Bank, Jajjar and holding of AGM on 24.9.2001 and handing over the records of company to Mahender Ahlawat/Sh. Jagdeep Rajain and also holding of EOGM by the petitioners on 29.6.2002 at United Coffee House , Connaught place, New Delhi.
  7. After going through the records and documents carefully submitted by the parties I find that both the parties have given affidavits that they do not have any records of any of the meetings like EOGM/AGM or transfer of shares or appointment of Board of Directors etc.  Both the parties have stated that the records are with the other parties.  The respondents have also not been able to submit any evidence and proof that Rs. 1 lakh given to M/s V.S. Building Material Suppliers was really meant for Shri Jagdeep Rain and Smt. Sunita Rajain being consideration of their shares.  The respondents have not given any conclusive evidence to this effect except mentioning that Shri Vijender Kumar of M/s V.S. Building Material Suppliers is related to Shri Jagdeep Rajain.  Mere relationship of each other cannot tantamount to automatically payment of money for their shares without any specific document/receipts.  The respondents have also failed to place on record any agenda paper/minutes of meetings of Board of Directors/AGM etc.  Similarly , the petitioners have also not been able to produce any documents relating to holding of EOGM on 29.6.2002  at United Coffee House, Connaught Place except submitting the bill of tea/coffee of the United Coffee House. Mere submission of bill of having taken tea/coffee at some place, does not tantamount to holding EOGM at that place without produc8ing any specific documents/records.
  8. I find that both the parties have no records with them except making allegations on each other.  It is difficult to appreciate the appointment of directors, holding of Board Meeting and transfer of shares by the respondents without providing any conclusive evidence or documents before this Board.
  9. In the premises, it is not possible to accept the versions of the respondents without support of any documents.  I, therefore, allow the petition and declare the appointment of any new directors other than the four initial subscribers as invalid.  The subsequent meetings held of the Board of Directors/AGM/EOGM etc are also declared invalid.  The company will have initial subscribers of four persons given below with their shareholdings.

S.No.               Name                           No. of Shares               Amount received

a. Mr. Sanjay Chikara                                      10                    Rs.100

b. Mr. Jagdeep Rajain                                      10                    Rs.100

c. Mrs. Sushila Ahlawat                                    10                    Rs.100

d. Mrs. Sunita Rajain                                        10                    Rs.100

                                                                        --------------------------

            Total                                                    40                    Rs.400            

  1. The admitted provision is that the company is not doing any business and the only property of the company is a piece of land, the purchase consideration of which has been shared by the four shareholders at Rs.45,000 each.  Since disputes have started between the parties, it is in the interest of the company that one group---out of the company.  Since the petitioners group holding 75% shares, I direct them to purchase the shares held by the second respondent at par. The company will, simultaneously pay Rs.45,000 to the second respondent being the part consideration paid by him for the land. This should be done within a month from the date of this order.
  2. Petition is disposed of with the above terms.

 

(K.C. GANJWAL)

            Member

New Delhi,

Dated the        December, 2003.