Company Law Board
Shri Raj Kumar Gupta, Shri Robin Gupta ... vs Shri R. Gupta, Shri Sanjeev Gupta And ... on 31 December, 2007
ORDER
Vimla Yadav, Member
1. In this order I am considering Company Petition No. 75 of 2006 filed by Shri Raj Kumar Gutpa and Ors. under Sections 397, 398 of the Companies Act, 1956 (hereinafter referred to as the "Act") against DP. Gupta and Co. Pvt. Ltd. and Ors. alleging reducing of petitioners into minority in shareholding and in management of the affairs of the company; non-payment of salary and perquisites to petitioner No. 1 for about last two years; vacating/surrendering of the premises of the respondent company without consulting the petitioner. M/s D.P. Gupta and Co. Pvt. Ltd. (R-3) having its registered office at 1/9-B Asaf Ali Road, New Delhi-2 was incorporated on 28.3.1978. The authorized share capital of the Respondent Company is Rs. 20,00,000/- divided into 15,000/- equity shares of Rs. 100/- each and 5,000 4% preference shares of Rs. 100 each. The main objects of the company are to buy, sell, import, export, manufacture, manipulate, treat, prepare and deal in sanitary goods, sanitary wares, earthen ware, tiles, porcelain, pipes, fittings, hardware, metals, tools and machinery, etc.
2. Shri Yogesh K. Jain, Senior Counsel for the petitioners contended that the relief in the present petition is mainly claimed by the petitioner No. 1 Sh. Raj Kumar Gupta a minority shareholder in the company M/s D.P. Gupta and Co. Pvt. Ltd. against Sh. R. Gupta and his son Sh. Sanjeev Gupta who constitute the majority shareholding in the said.company and had been managing the affairs thereof. The petitioner No. 1 holds 2793 shares out of the total issued 6255 shares having paid all call money and is thus competent to file the present petition under Section 399 of the Act. The petitioner No. 2 & 3 and Sh. Nikhil Gupta the other minority share holders have also given their consent to petitioner No. 1 to file the present petition though they themselves have not claimed any separate relief for themselves in the present petition. The petitioner No. 1 and the Respondent No. 1 had equal number of shares along with their father Late Sh. D.P. Gupta who founded the company and both were directors therein with equal participation in the business, the Respondent No. 1 by using his dominant position as the elder brother and the surviving eldest member in the family manipulated the share holding in such a manner as to gain majority for himself and his family members and reduced the petitioner No. 1 into minority. The petitioner No. 1 and the Respondent No. 1 had equal number of shares till August 1986. The said proportion substantially changed after the death of their father Sh. D.P. Gupta whereby the Respondents could carry their own decisions suppressing the voice of the petitioner No. 1 even to his detriment. The fact that both the petitioner No. 1 and the Respondent No. 1 started with equal No. of shares but after the death of their father the Respondent No. 1 gained a substantial majority has not been denied by the Respondent nor has it been proved by them from the records of Registrar of Companies as to how and when their share holding went up while that of the petitioner remained the same. The Respondents have tried to make a feeble of an alleged Will of Late Sh. D.P. Gupta but the same has never even seen the light of the day nor was it ever probated to give any legal effect to it. In the absence of a probate the alleged Will, if any, could not have been used by the Respondents to their own advantage and to the detriment of the petitioner. My attention was also drawn to the provisions of Section 397 and 398 of the Act and it was argued that in the present case the petitioner No. 1 being a share holder in the company has been as much entitled to his legitimate rights in law as the Respondent No. 1 himself. The Respondent No. 1, however, by using his dominant position deprived the petitioner of his equal share holding affecting adversely his right of equal participation in the business which is nothing but an act of oppression.
3. Further, it was pointed out that the company had an account in Syndicate Bank, Asaf Ali Road, New Delhi which could be operated both by the petitioner and Respondent No. 1 as Directors. After Respondent No. 2 also became a director the Respondents closed the said account and opened another fresh account with instructions to the bank that the same shall be operated only by the Respondents and the petitioner was excluded from the operation of the account even though he had been doing so right from the inception of the company. The Respondents' contention that new account had to be opened because of withdrawals of security submitted by the family members of the petitioners in this regard does not carry any weight in as much as the persons having provided securities were free to act on their own and withdraw if they so needed to. Opening of a new account, however, could only be done by way of a proper resolution and the same too ought to have been allowed to be operated by the petitioner and the Respondent No. 1 as throughout in the past. The Respondents also stopped paying all perks and salary to the petitioner as he was entitled to and was being paid. Though they themselves continued to withdraw the same. The petitioner under the impression that he could operate the bank account withdrew a sum of Rs. 50,000/- from the bank on account of the huge arrears of his salary and perks even though the arrears were higher but on the bank informing him that under the fresh instructions of the Respondents only they could operate the account the petitioner immediately reimbursed the bank showing his bonafides. Had the petitioner been out to fraudulently withdrew the amount of the bank from the account of the company he would not have reimbursed the amount to the bank but the very fact that he did so shows his integrity and bonafides but the Respondents have not yet paid his salary and perks for the last about two years.
4. Furthermore, Sh. Yogesh K. Jain argued that because of having gained majority in share holding the Respondent No. 1 also introduced his own son Respondent No. 2 into the board of directors without holding any AGM or complying with other provisions under the Companies Act thus again gaining a majority even in the board of directors suppressing the voice of the petitioner there also. The act of adversely affecting the right of the petitioner by reducing him into the minority in the board also emanates from having been reduced into a minority as a share holder and, therefore, the same too is an act of oppression of a minority share holders as envisaged under Section 397 of the Act. The Respondent have alleged that Respondent No. 2 was appointed as director at the instance of petitioner No. 1 himself in a board meeting, photocopy of which has been filed. The petitioner seriously challenges the factum, legality and validity of the said alleged meeting. It was contended that the best legal evidence ought to have been produced i.e. form 32 from Registrar of Companies that the Respondent No2 had been lawfully taken as a director of the company secondly a perusal of the said minutes of the meeting would also show that Smt. Vidyawati was also taken as a director and chairman of the company but again no official records from Registrar of Companies have been produced nor has Smt. Vidyawati been shown to have acted in this capacity ever thereafter. In the absence of the necessary records from Registrar of Companies and in the absence of the whole resolution have been given effect to only a selective part thereof of taking Respondent No. 2 as director is not at all trustworthy.
5. Further, it was argued that any act that jeopardised or negatively affected the interest of the company are obviously acts of mismanagement more particularly when they are deliberate and conscious acts and not simply misjudgments as the Respondent's counsel tried to submit the judgments cited by the counsel refer only to commercial misjudgments but not deliberate acts that cause loss to the company and consequently to the share holders/directors, while in the process making unlawful gain by the directors managing the company i.e. the Respondents in the present case. Drawing my attention to the acts of mismanagement it was pointed out that the Office at 1/6-B, Asaf AH Road was dismantled and unauthorized construction was made admittedly inviting litigation from the landlords and thus jeopardizing the most major asset of the company. Needless to say that commercial premises in a well known commercial area having great potential are not available easily and cost as much if not more than the cost of the property itself. A thoughtless action by the Respondents in carrying out unauthorized construction so as to disturb the office of the petitioner is not only irresponsible but would cost the company dearly. It was contended that it is obviously an act of mismanagement only. The allegation that the Respondents were only renovating the premises does not carry any substance in as much as in such a case they would have sought the permission of the land lord and the land lord having given the permission would not have filed a suit against the company. Further, it was pointed out that the Respondents in the past have been surrendering various premises to the land lord which fact again has not been denied in the reply. The petitioner has clearly averred that the surrender has been against the receipt of premium under the table. Though the Respondents have admitted the surrender of the various premises as stated by the petitioner have denied the receipt of premium. They have also alleged that the respective land lords of the premises had requested the Respondents to vacate the premises in response to which the same were vacated. The plea, it was argued, if nothing else is so naive that it is that to believe the same would be something impossible for any reasonable person. It is rather abusing the intelligence of normal person that in a city like Delhi any commercial premises would be vacated and surrendered to the land lord simply on his so asking. In any case even if the premises have to be surrendered it was an important decision which ought to have been taken in a proper meeting of the board of directors in accordance with law. Furthermore, it was pointed out that the most important premises where the company was still carrying out its business as a branch office/Showroom was at SCF-23, Sector 18D, Chandigarh, a prominent commercial centre, for which premises the company was paying Rs. 600 as rent without holding any board meeting or even consulting the petitioner were surrendered which to the knowledge of reasonable estimate fetched approximately Rs. 1 crore which was the prevailing market rate. The Respondent showed only a receipt of Rs. 1,50,000/- in the books against the said premises which amount too is alleged to have been received against the price of the dilapidated fittings and fixtures in the premises. The allegations that the sum of Rs.l,50,000/- was received against the price of the dilapidated fittings and fixtures is patently wrong in as much as the said fittings and fixtures could not be of any use to any person unless he too was to carry on business of the same nature for which purpose the fittings and fixtures were made. Moreover, the sum of Rs. 1,50,000/- was not received from the land lord but from one Sh. Anil Bansal dealing in property business showing that it was a purely commercial transaction. It was contended that in the fact of these real and unambiguous averments the Respondents ought to have produced the best possible evidence which was in their power and possession only i.e. the details of the payments received by cheque or otherwise through the bank, copy of the receipt, if any, given to the person paying the amount, etc. under Section 106 of the Evidence Act. The burden of proving a fact within the personal knowledge of the party is upon it which it should prove by way of best possible evidence. It was argued that in the absence of the same an adverse presumption is to be drawn against the Respondent that a much larger amount was received against the surrender of the premises thus hitting the business of the company and shifting it to some non descript premises in a far off industrial area that too at a rental of Rs. 7500/- p.m. For the same reason the allegation of the Respondent that the office of the company in Chandigarh had to be surrendered due to decline in sale is only an effort to pull wool over the eyes as if the sales were declining the business would have been closed all together and not shifted to costlier premises in a remote area where the sales would decline even further. In any event, it was argued that the decision to surrender the premises at Chandigarh without a proper board resolution was nothing short of mismanagement at the cost of personal gains to the Respondents.
6. It was argued that if the acts of mismanagement continue there is bound to be a stalemate and the company shall not be able to function and which itself is a ground for winding up of the company which may not be in the interest of the company and the parties and, therefore, the petitioners claim very innocent relief which take care of the legitimate rights of the petitioner and help the company to run smoothly which is the basic purpose under Sections 397 and 398 of the Act.
7. Ms. Anjoo Jain, Counsel for the Respondents responding to the petitioner's allegation relating to the arbitrary increase in shareholding whereas the shareholding pattern has remained constant since 1987, it was argued that after the death of Shri D. P. Gupta, father of Petitioner No. 1 and Respondent No. 1 on 7.8.1986 and as per his will dated 03/03/985, the shareholding of 2662 equity shares of Rs. 100/- each were divided equally between his two sons. Since 1987 till date the Petitioners have not raised any objection to the will, division of Shareholding and have also signed balance sheet and annual Returns. It was pointed out that the share-holding in the company even today remains unaltered.
8. Further, it was pointed out that Sh. Nikhil Gupta who has also given his consent to petitioner No. 1 to file the present Petition and Ms. Nilofer Sahney, i.e. the daughter of petitioner No. 1 have filed winding up petitions before the Hon'ble High Court of Delhi being petition No. 256 and 257 of 2006. Placing reliance on Srikanta Datta Narasimharaja Wadiyar v. Sri Venkateswara Real Estate Enterprises (Pvt.) Ltd. and Ors. 1991 (072 ) COMPCAS 0211 KAR it was contended that the present Petition cannot be pursued as the relief claimed in the winding up Petition is the ultimate relief under the provisions of 397 and 398 of the Companies Act 1956.
9. Furthermore, it was argued that the present petition is not maintainable as no cause of action is accrued in favour of the petitioners and against the respondents to resort to Sections 397/398 of the Companies Act, 1956. The reliefs sought in the present case do not warrant action under Sections 397, 398 of the Companies Act. The petitioners have miserably failed to make out a case under Sections 397 & 398 of the Companies Act, and therefore the present petition should be outrightly rejected. Further, it was argued that a Petition under Sections 397/398 Companies Act, cannot be made for settling personal scores among the family members. The relief sought should be to put an end to the acts of oppression/mismanagement and not for any oblique purpose. Reliance was placed on Dr. S. Mangalam Srinivasan v. Mani Forgings P. Ltd. and Ors. 2006(129) Compcas 0544 CLB and Ramesh Bhajanlal Thakur v. Sea Side Hotel (P) Ltd. SCL 2000 (23) 164. There are no allegations of oppression of the petitioners. The petitioners have miserably failed to show that the acts of respondents are oppressive against them. Their grievance, if any, is qua director and not qua shareholders. Reliance was placed on N.K. Mahopatra v. State of Orissa 1999 (96 Company cases) 49. Further, it was argued that the allegations levied by the Petitioners against the Respondents are vague and without any supportive evidence about misappropriation of assets or improper use of effects. The necessary ingredients constituting oppression or mismanagement as required under Section 397/398 have not been pleaded in the Company Petition. The facts alleged in the Company Petition, even assuming, without admitting as true, do not make out a case or cause of action falling under the provisions of Section 397 and 398, entitling the petitioners for any relief. All the grievances of the petitioner, being personal in nature, cannot be agitated in a petition under Section 397 or 398 but shall invoke the common law for necessary redressal of his grievance. Reliance was placed on Hanuman Prasad Bagri v. Bagress Cereals (P) Ltd. (2001) 33 SCL 78 (SC) and Palghat Exports Private Ltd. and Anr. v. T.V. Chandran and Ors. 1994 (079) COMPCAS 0213 KER.
10. Further, it was argued that the present petition is not maintainable. The Petitioners have been dragging the Company into multifarious litigations between the parties which are pending in the Civil Court Suit No. 194 of 2006. (Shri Robin Gupta v. Lotus Industries and Ors.) pending in Tis Hazari Court; Company petition 256 of 2006 (Sh. Nikhil Gupta v. D.P Gupta and company Private Limited) Pending before the Hon'ble High Court, Delhi; Company petition 257 of 2006 (Ms. Nilofar Sahney v. D.P Gupta and company Private Limited) Pending before the Hon'ble High Court, Delhi; Arbitration Application No. 427 of 2006 (Mr. Sanjeev Gupta v. Smt. Shashi Gupta and Ors.) where the Hon'ble High Court has appointed Arbitrator and the Arbitration Proceedings are pending; Smt. Alpana Gupta v. Lotus Industries and Ors. pending in Tis Hazari Court. The relief sought in civil suits are similar to the ones sought in the present petition. Placing reliance on Sardar Iqbal Singh and Anr. v. SardarFurboksh Singh and Ors. SCL 2000 (vol. 24) Pg. 527 it was prayed that the Petition deserves to be dismissed.
11. Replying to the allegation that the meetings were not held properly, it was contended that this allegation is vague without being substantiated by any evidence. It is total figment of imagination that Respondent No. 1 used any undue influence on Petitioner No. 1. Rather it was the respondent who constantly ignored the whimsical approach of the Petitioner because of his being younger to him. Both the petitioner and the respondent are major share holder and the Minutes of the Meeting of the Board of Directors were duly read before signing by petitioner No. 1. The petitioner No. 1 is pretending to be ignorant so as to suit his convenience. He has always had keen interest in his share of profits in the business instead of business itself. He has never devoted his time, attempts and efforts on the growth of the business rather he has always spent his time and efforts on making personal gain from the business and has always been a sibling rival to his elder brother. The respondent No. 1 being the elder brother of petitioner No. 1 has always ignored his behavior. As regards the appointment of Sh. Sunjeev Gupta as Director, it was pointed out that Mr. Sanjeev Gupta was appointed by a valid Resolution of the Board of Directors. At the shareholders' meeting on 15.9.1986 his name was suggested by Respondent No. 1 and Resolution was passed accordingly. Thereafter, Mr. Sanjeev Gupta has been continuing as director in the company without any change. My attention was also drawn to the copy of the Minutes of the board dated 15.9.1986 As regards Office space in the showroom at 1/6-B, Asaf Ali Road. New Delhi which the respondents dismantled and started carrying out some unauthorized construction therein which not only forced the petitioner to move out leaving him with no respectable office but inviting litigation from the land lord who has filed several cases against the company, it was argued that this allegation has been duly refuted by the Respondents. It was pointed out that a suit was filed by the landlord Sh. D.S. Chopra on 20.9.2005 seeking demolition of the mezzanine floor on the ground that the same was done without his consent. In reply to the suit, the Company averred to have sought permission from Sh. Pyare Lal Chopra, the then landlord, father of the present landlord. My attention was brought to the copies of Compromise deeds between the Company and then landlord. It was pointed out that the matter is now been lingered by the present Landlord and is adjourned to 10.1.2008. Further, as regards Surrender of tenancy of Chandigarh Showroom, I it was argued that the allegation is vague and without any supporting evidence. The surrendering of the tenancy was a joint decision for the benefit of the Company and as admitted by the Petitioner was almost two years back. Furthermore, as regards Surrendering of premises at A-36, NDSE Part II belonging to M/s Lotus Enterprises Pvt. Ltd. a shareholder, it was pointed out that any decision taken was always with the due consultation of the Petitioner, though he did not participate in the affairs and was only interested in sharing profits. M/s Lotus Enterprises Private Limited, though not a party to the present case, was under going financial loss and the arrears had to be paid. The landlord had filed a case against the Company M/s Lotus Enterprises Private Limited. The premises had been handed over all almost two years back. That said godown was situated in a residential area and could not attract many customers and there was also a constant pressure from the authorities like MCD etc. As regards surrendering of 16B 15, D. B. Gupta Road belonging to the company, it was contended that about ten years ago, this premises was surrendered and a godown premises was purchased at 55-8. Gali No. 2, Madhya Marg Tughlakabad Extension, New Delhi, in the joint names of Petitioner No. 1 and Respondent No. 1, having 50% share each in the said property. This fact has been admitted by the petitioners
12. The counsel for the respondents, replying to the petitioners' allegation that the company's account with the Syndicate Bank at Asaf Ali Road which was closed in the first week of June 2006 and another current account under signatures of the respondents i.e. Sh. R. Gupta and/or Sh. Sanjeev Gupta, excluding the petitioner from operating the bank account of the company, it was pointed out that the company initially had an overdraft limit with Syndicate Bank, Asaf Ali Road, New Delhi-II 0002, which had to be closed due to Petitioner No. 1 refusing to sign the papers for extension. The petitioner and his family members wrote letters to Syndicate Bank. Asaf Ali Road, New Delhi-110002 on 11.3.2006 for return of their FDR pledged with Syndicate Bank, collateral security against the overdraft limit. The family members of Shri Raj Kumar Gupta, Petitioner No. 1 have also clearly mentioned that he had in his capacity as Director of the company, written to the said Bank on 29.12.2005. It was contended that that petitioners No. 1, 2 and 3 have been sabotaging the smooth running of the company. The respondent No. 1 had to substitute and mortgage his residential property at C-729, New Friends Colony, New Delhi-II 0025 with the said Bank in order to pay and close the overdraft limit. Further the other two Directors viz Shri R. Gupta and Shri Sanjiv Gupta had to open a current account under their signatures so that the working of the company is not hampered. The company also wrote two letters to Syndicate Bank, dated 14.6.2006 and 13.7.2006. The said fact has been admitted by the Petitioner. It was pointed out that the Petitioner has worked against the interest of the Company. Furthermore, the Petitioner No. 1 willfully and intentionally got issued a Cheque Book and also tried to withdraw the money of Rs. 50,000/- from the current account of the company on 19.6.2006 although he was not authorized to operate the present current account. The petitioner also wrote a letter dated 19.6.2006 to Syndicate Bank alleging that his signatures had been forged and he will take legal action for forgery and misappropriation on the Bank as well as the two Directors. Due to these activities of petitioner No. 1, the company was forced to withdraw all the allowances given to him. The Petitioner has accepted to have withdrawn money and have shrugged off the same in a callous fashion by calling it a mistake at the time of arguments.
13. The counsel for the respondents further pointed out that the petitioner has been getting his monthly salary by cheque like other directors. He has been paid up to the month of June 2006. Even the Balance sheet and profit and loss account of the company as at 31.3.2005 has been signed by petitioner on 26.08.2005. It was reiterated that the Respondents have been devoting their full time in the family business whereas the petitioners have their separate entities and have been working for personal gains. My attention was drawn to the other entities exclusively owned by the Petitioners which have come to the knowledge of Respondents which include a new Firm on the first floor of 1/6-B Asaf Ali Road, New Delhi (in which the company has its showroom on the Ground floor.) This new firm was opened under the name and style of "ROBIN GUPTA & CO." Shri Raj Kumar Gupta is continuing to work for his Personal gains from this new firm. This firm is also engaged in the business that of the Company, M/s D.P. Gupta and Co. (p) Ltd, A profitable cake and pastry business is also being carried out by Shri Raj Kumar Gupta alongwith his wife Smt. Shashi Gupta from the family residential premises at A-41, Friends colony (East), New Delhi, under the name and style of "TEMPTATIONS". The electricity and vehicle of the Company were being misused for making the cakes and pastries as well as delivering the same to their customers; Shri Raj Kumar Gupta was also running a business of supplying imported seeds and plants which was being done with his son, Shri Nikhil Gupta, residing in USA. This business was carried out under the name and style of "RNR ENTERPRISES" (signifying Raj, Nikhil and Robin i.e. father and two sons). Further, it was pointed out that by the counsel for the respondents that the parties had desired to compromise during the initial hearings before the Hon'ble Members. However, the Petitioners are not interested in any amicable settlement and are desirous to harass and malign the respondent company and its directors.
14. I have considered the pleadings as well as annexures thereto and the arguments of the parties. The petitioners have failed to make out a case of oppression and mismanagement which could entitle them to attract the provisions of Sections 397 and 398 of the Act. Considering the facts and circumstances of the case, I find that the respondents' contention that this petition under Sections 397/398 of the Act has been made for settling personal scores among the family members appears to be true. But the respondents' contention that directorial complaints cannot be agitated under Sections 397 and 398 of the Act as the complaint in such a petition should be relating to the rights qua a Member is not tenable. The present case is that of a family company which is in the nature of partnership and in such cases, depending on the facts of the case, directorial complaints have been adjudicated by this Board in Sections 397/398 proceedings. However, the respondents' other contention that the petitioners have acquiesced to the alleged actions or omissions pertaining to the oppression and mismanagement is also found to be correct. The alleged issuing of 50% of equity shares (1331 each to the petitioner and respondent group) of Sh. D.P. Gupta on his death divided equally between his sons as per his Will dated 03/03/1985 had not been challenged till the date of filing of the petition by the petitioners. The petitioners have acquiesced to such allocations. Similarly, they have acquiesced to the appointment of Sh. Sanjeev Gupta as Director who was appointed by a resolution of the Board of Directors as suggested by Respondent No. 1 in shareholders' meeting dated 15/09/1986 and similar is the situation regarding surrendering of the various premises occupied by the respondent companies including the premise at 16B 15 D.B. Gupta Road, which was surrendered about 10 years ago and a godown premises was purchased at 55-8, Gali No. 2, Madhya Marg, Tughlakabad Extension, New Delhi in the joint name of P-1 and R-1 having 50% shares each. This fact has been admitted by the petitioners in their rejoinder. The petitioners have failed to substantiate their claim of receipt of on money on surrendering of the premises. Besides, the petitioners have failed to meet the Respondents' contention that the old matters to which the petitioners have acquiesced have been agitated in the petition which cannot be considered having got barred by laches and delay. The Respondents' contention is tenable. Sh. D.P. Gutpa's Will dated 3/3/1985, appointment of Sh. Sanjeev Gupta as Director decided in shareholders' meeting on 15/9/1986 and surrendering of company's premises particularly the one referred to above at D.B. Gupta Road, about 10 years ago cannot be agitated in a petition filed under Sections 397/398 of the Act on 4/8/2006. There has been considerable delay in making this petition. Even if the provisions of Limitation Act are not applicable to proceedings before the Company Law Board yet there is an abnormal delay in bringing the matter before the Company Law Board and on this ground alone, the petition should be dismissed. There is no plea for condoning delay and laches on the part of the petitioners in initiating proceedings before the Company Law Board. The acts complained of amounting to alleged oppression and mismanagement are barred by delay and laches.
15. As regards the allegations pertaining to non payment of salary and perquisites to P-1 for about last 2 years and not letting him operate the bank account, the Respondents', contention regarding the conduct of the petitioners which is a very relevant factor to be considered in equitable proceedings Under Section 397/398, of the Act, cannot be lost sight of. The petitioners have not acted in the interest of the company. The P-1 has accepted having withdrawn an amount of Rs. 50,000 from the account of the company on 19/6/2006 and the same has been explained only as a mistake at the time of arguments. The petitioners have withdrawn their securities given to the bank leaving the Respondents Company to fend for itself to be able to operate its current account. Besides, the petitioners have written to the banker against the company. Furthermore, the petitioners have embroiled themselves into multifarious litigation including filing of winding up petition by one of the petitioners who has given his consent to the filing of this petition. The reliefs claimed in the multifarious litigation are similar to the ones claimed in this petition. The facts and circumstances to which my attention was drawn point out to a situation where I find that the petitioners have themselves distanced from the affairs of the company and have acted in a manner which is not in the interest of the company. The allegations regarding not holding of proper meetings are vague and unsubstantiated. The petitioners have failed to make their case that they have been reduced to minority in shareholding and in the management of the affairs of the company. Nor have they been able to refute the contentions of the Respondents supported by case laws meeting the allegations of the petitioners. However, to do justice between the parties, I hereby attract the provisions of Section 402 of the Act in the interest of proper regulation of the conduct of the company's affairs in future and hereby give the petitioners an option to go out of the company on a fair valuation of their share to be got done by a valuer to be appointed by the petitioners and the respondents after the petitioners have been allowed access to the account books and statutory record of the Respondent Company besides paying the petitioner No. 1 all his pay and allowances till date.
16. The petition is disposed of with the above directions. All CAs stand disposed of. All interim orders stand vacated. No order as to cost.