Rajasthan High Court - Jaipur
Vijay Julka And Others vs Samriddhi Mega Structure Ltd And ... on 14 May, 2018
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Company Appeal No. 9/2013
1. Vijay Julka S/o Shri R.c. Julka, R/o E-122, Sector 52,
Noida U.p.
2. Deepankar Julka S/o Vijay Julka, R/o E-122 Sector-52,
Noida U.p.
3. Nikhil Julka S/o Vijay Julka, R/o E-122, Sector 52, Noida
U.p.
4. Valentino International Private Limited, Having Its
Registered Office At F-529, Riico Industrial Area, Bhiwadi,
Alwar, Rajasthan.
----Appellants
Versus
1. Samriddhi Mega Structures Limited Having Its Registered
Office At 810, Arunachal Building 19, Barakhamba Road,
New Delhi Through Its Director Mr. Ramesh Dugar.
2. Mr. Ramesh Dugar, S/o Shri G.l. Dugar, R/o H-33, Lane
W-10C, Western Avenue, Sainik Farms, Khanpur, New
Delhi 110062.
----Respondents
Connected With S.B. Company Appeal No. 3/2012 Mr Vijay Julka And Others
----Appellant Versus M/s Smriddhi Mega Structures Ltd And
----Respondent For Appellant(s) : Mr. Anant Kasliwal.
For Respondent(s) : Mr. J.K.Singhi, Sr. Advocate assisted by Mr. Sanjeev Singhal.
HON'BLE MR. JUSTICE SANJEEV PRAKASH SHARMA Order Judgment reserved on : 15/02/2018 Judgment pronounced on : 9/5/2018 (2 of 9) [COA-9/2013] (1) By way of this appeals, the appellants seek to challenge the order dated 14.06.2013 passed by the Company Law Board, New Delhi (hereinafter referred as 'CLB') whereby the respondents were held to be owners of 25,520 share Certificates before the CLB and the Company was directed to make entry accordingly within 45 days and further the Bench Officer was also directed to return the Original Share Certificates to the petitioners while duplicate Shares Certificates were directed to be returned to the respondents in a Company petition moved by the respondents under Sections 111, 111A, 235, 397 and 398 of the Companies Act, 1956 (hereinafter to be referred as 'the Act of 1956'). (2) Brief facts which are required to be noted for disposal of these appeals are that appellant No.4 Valentino International Private Limited was earlier incorporated as Triumph Castings Pvt. Limited in the year 1985 and the name was changed to the present in the year 2008 (issuing of Certificate to the said effect by the Registrar of Companies on 20.02.2008.
The share capital of the company was with a share of Rs. 10/- each. Paid up capital was 95 lacs, out of which only 9,50,000 shares of Rs.10/-. Initial promoters of Company was Shyam Lal Gupta and Mr. Satish Kumar Gupta and the said persons to report entire share capital upto 1992 whereafter in 1992, the appellant No.2 Vijay Julka as CMD of Supriya Pharmaceuticals Limited purchased the entire share holding of the Company. However, only 14540 shares were transferred to Supriya Pharmaceuticals Limited and balance 15,150 shares remained with Shyam Lal Gupta. The registered Office of the house shifted to F-529, RIICO Industrial Area, Bhiwadi. Appellant (3 of 9) [COA-9/2013] No.1 is the Director of the Company, Appellant No.4 is a Company since 1992 and Supriya Pharmaceuticals Limited purchased the share holding of the Company from Shyam Lal gupta. (3) Respondent No.2 Ramesh Dungar claimed 100% share holding of the appellant No.4 Company and was inducted as a Director of the Company as on 28.9.1996. However, on account of the provisions contained under Section 283(1)(g) of the Companies Act he seems to be Director of the Company and the Board of Directors passed a Resolution to this effect on 27.1.2005. The corporate Office of appellant No.4 came to be shifted to Office of Ramesh Dugar in 2002 whereafter it was shifted to Nehru Place, New Delhi in 2003. After the shifting of Office of respondent No.2 all the necessary documents were handed over to the appellant and it was only for brief period when the Office at the residence of respondent No.2. On inquiring about the missing share certificates, the appellant No.1 was informed that the original share certificates have been lost by Ramesh Dugar. On coming to know the said fact, the appellant No.1 trusting Ramesh Dugar, did not lodge any FIR and he instead issued duplicate share Certificates on 15.03.2004.
(4) In 2007, respondent No.2 has filed an FIR against the appellant and no case was made out by the Investigating Officer on 31.12.2008. On case being reopened final report was again given on 2.6.2009. The investigating report also mentioned of respondent No.4 admitting that one Meenakshi had alleged the transfer share in favour of respondent No.2 whereafter on 5.10.2007 he filed an application under Sections 397 and 398 for oppression and mismanagement against the appellant. It was (4 of 9) [COA-9/2013] submitted by the appellants that the respondents had not been issued any share and no shares were transferred in favour of respondent No.2 and, therefore, petition be rejected. It was a case of the appellants that Ramesh Dugar had first stolen the share Certificate and later on transferred the shares in favour of M/s. Dagar Security Limited which is now known as Samardhi Mega Structures Limited. In the circumstances, it is stated that the appellant moved an application under Regulation 44 before the CLB challenging the maintainability of the company petition and locus of respondent No.2 with regard to filing of company petition, ground of delay and laches were also taken.
The said application filed by the appellants was dismissed on 5.3.2009. The appeal preferred by this Court was also dismissed vide order dated 5.5.2011.
(5) The company petition was heard finally by the CLB wherein the appellants contended that the persons who had signed the share certificate namely Meenakshi was a personal secretary of respondent No.2 and was not authorised to transfer shares in the name of respondent No.2 and there was no authorization from the appellant No.4 Company for the said purpose. It was noted by the appellant that the alleged payment said to have been made by respondent No.2 was in the year 1996 and the transfer of shares alleged is in 2001. No documents were filed to produce the proof of transfer of shares and the said transfer was violative of Section 108 of the Act of 1996 as there was no meeting held for passing of the Resolution nor any stamp duty was paid nor there was entry in the folio register. The CLB after hearing the contents passed the order holding the (5 of 9) [COA-9/2013] respondent company to be owner of 25,500 shares and further directing the name of respondent Company to be included in the register of Members.
(6) Learned Counsel for the appellants submits that the appellant Vijay Julka purchased entire share holding of respondent No.4 Company and was the Director with appellant No.4 Company since the year 1982 when the share holding of the company was purchased by Supriya Pharmaceuticals Limited from Shaym Lal Gupta. Respondent No.2 was inducted as Director of the Company on 28.9.1996. However, due to irregularity in attending consecutive Board Meetings he ceased to be a Director of the Company as per Section 283(1)(g). The Board of Directors of appellant No.4 Company, passed a resolution to the said effect on 27.1.2005. The genuineness of Share Certificates relied upon by respondent No.2 is seriously disputed as the same were never purchased but were stolen from the Office of appellant No.4 Company. The Companies namely Supriya Pharmaceuticals and the appellant M/s Triumps Casting Private Limited were thereafter owned by Mr. Vijay Julka and were managed from the same premises originally lateron they were shifted for some time to the premises of M/s. Dugar Securities Private Limited and thereafter to Nehru Place at Chiranjiv Tower and then to Devika Tower in the year 2009. At the time of shifting the office respondent No.2 has withheld the Share Certificates of the appellant Company and the appellant upon contacting respondent No.2 inquiring about missing Share Certificates was informed that the same have been lost by respondent No.2. In good faith, appellant No.1 did not (6 of 9) [COA-9/2013] lodge an FIR but instead issued duplicate Share Certificates on 15.03.2004 and at that time, respondent No.2 did not raise any objection.
(7) It is further submitted that respondent No.2 lodged an FIR on 24.07.2007 against the appellant wherein final report was submitted by the Investigating Officer on 31.12.2008 which was again reopened. However, again final report was submitted by the Investigating Officer on 2.6.2009 mentioning that on the basis of facts and documents, the case is of a civil nature. During the pendecy of the criminal proceedings and after lodging of the FIR, respondent No.2 filed the application under Order 397 and 398 before the Company Law Board. The petition was opposed by the appellant and it was asserted that respondent No.1 had never issued any shares or transfer to respondent No.2. Learned Counsel submits that the transfer of shares in faovur of M/s. Dugar Security Limited was a fraudulent transfer.
(8) The locus of the respondent to file a Company petition was taken up. The question of delay was also taken up. However, vide order dated 5.3.2009, the application submitted by the appellant was dismissed by the Company Law Board. The appeal was preferred against the order dated 5.3.2009. However, before appeal could be heard on merits company petition filed by respondent No.2 came to be finally heard and therefore, this Court dismissed the appeal of the petitioner on 5.5.2011. Learned Counsel submits that respondent No.2 is a qualified Chartered Accountant who has manipulated the record and the shares. Feeling aggrieved of the Company Law Board decision, learned Counsel submits that the Company Law Board although taken note (7 of 9) [COA-9/2013] of mandatory provisions of Section 108 and they being mandatory provisions for holding a Meeting before transferring the shares in terms of Rule 84 and there being no entrée in the folio register or submission of 7B, the shares cannot be said to have been transferred to the respondent. Learned Counsel submits that the order passed by the Company Law Board deserves to be quashed and set aside.
(9) Per contra, learned Counsel for the respondents filed reply and denies submissions and allegations levelled by the appellants. The respondents supports the order passed by the Company Law Board dated 14.06.2013 and submits that the CLB has rightly held the respondent Company to be the owner of 25,520 shares and the directions for making entrée in the register of Members was also rightly passed. Appellant No.1 Company was wholly owned by Shyam Lal Gupta and his associates in the name of M/s. Triumph Castings Pvt. Limited was changed to Valentino International Private Limited. Lateron Superiya Pharmaceuticals purchased the entire share holding. It is admitted that the appellant is the Director of appellant No.4 Company. The contention of the appellant that the companies were owned by Mr. Vijay Julkha have been denied stating that M/s. Superiya Pharmaceuticals was a public Limited Company. It is stated that Mr. Vijay Julkha attempted to grab the Company and also manipulated in the affairs of the Company on account of his action, respondent No.2 had to approach the Company Law Board. Allegations have been made relating to appellant No.1. Learned Counsel for the respondent also relies on the report of the compliance Certificate submitted by Anupam Agarwal and (8 of 9) [COA-9/2013] Associates relating to the year 16.10.2010 wherein it has been mentioned that the Company has not issued any duplicate Share Certificates this year.
(10) Learned Counsel also submits that the final report submitted by the police officials is false and motivated and no reliance can be placed on it. It is further stated that no question of law is involved in the present petition, and therefore, the appeal be dismissed. It is submitted that under 10F only the question of law is determined as to whether the appeal could be entertained. (11) Having considered the submissions I find that the ownership of shares by Dugar Security Limited was not proved before the Company Law Board. However, it set aside the increased authorized capital, issue of additional shares to the actual and bonafide share holders. It also set aside the removal of Mr. Ramesh Dugar as Director although admittedly he remained absent in three consecutive meetings without leave and thus was disqualified to remain as Director in terms of the Companies Act of 1956. It is also seen that the transfer of shares has been endorsed under signature of one Meenakshi who was neither a nominated authorized person nor Officer or Director of the Company. She was not in employment of appellant No.4 Company. She was Personal Secretary of Mr. Ramesh Dugar respondent No.2. Thus, the transfer of shares in favour of Ramesh Dugar is clearly made out to be on account of connivance of an outsider and was thus a fraudulent act. It can be seen from the final report submitted by the police that Ramesh Dugar informed share holder of the Company M/s. Supriya Pharmaceuticals by taking over/purchased the entire share holding of company by paying Rs.3,01,200/-
(9 of 9) [COA-9/2013] whereas only 14610 shares were initially transferred. Thus, the entire share holding could be said to be either with Vijay Julka or M/s. Supriya Pharmaceuticals. The order of the Company Law Board has factually fallen in error without following the mandatory provisions of Section 108 of the Companies Act. The findings arrived at by the CLB of transfer of shares in favour of Ramesh Dugar was in contravention of law and can't be sustained. This Court also agrees to the submissions made by the learned Counsel for the appellant that the matter relating to adjudication of disputes regarding title of shares ought not to have been examined by the Company Law Board and the parties should be relegated to civil Court for declaration of title. Further, the adjudication of ownership of 30,130 shares embarked upon by the Tribunal has resulted in allotting only 20520 shares to the respondents which is not based on sound principles. Duplicate Certificates which are existing on record, ought to have been taken into consideration as the same were never doubted by the respondents in his petition. Thus, the conclusion arrived at by the Company Law Board is erroneous.
(12) The appeal is accordingly allowed. The order passed by the Company Law Board dated 14.06.2013 is accordingly quashed and set aside.
(SANJEEV PRAKASH SHARMA),J N.Gandhi/16-17