Document Fragment View

Matching Fragments

1. This appeal is filed against the order passed on 12.3.1996 by learned Company Judge allowing the Company Application No. 113 of 1995 and dismissing Company Petition No. 35 of 1988 being barred by law of limitation.

2. By filing Company Petition No. 35 of 1988, the Company Court was moved at the instance of R.B. Desai & Others for rectification of the register of the Company. Respondents No. 2 and 3, by taking out the Company Application No. 113 of 1995 sought for an order to the effect that Company Petition No. 35 of 1988 be dismissed on the ground that petition is barred by limitation, without going into the merits of the petition. The said respondents prayed for other reliefs which are reproduced in the judgment, and as the same are not relevant for the purpose of deciding this appeal, we are not referring to the same.

the person aggrieved, or any member of the company, or the company, may apply to the Court for rectification of the register.

(2). The Court may either reject the application or order rectification of the register; and in the latter case, may direct the company to pay the damages, if any, sustained by any party aggrieved.

In either case, the Court in its discretion may make such order as to costs as it things fit.

(3). On an application under this section, the Court-

(a). may decide any question relating to the title of any person who is a party to the application to have his name entered in or omitted from the register, whether the question arises between member or alleged members, or between members or alleged members on the one hand and the company on the other hand; and

(5). The provisions of sub-sections (1) to (4) shall apply in relation to the rectification of the register of debenture holders as they apply in relation to the rectification of the register of members.

13. In the petition, the petitioners came out with a contention that they could not detect the fraud earlier, and hence there was a delay. However, from one Criminal Complaint which came to be filed by one Ashim Roy of the Trade Union, they came to know about the same somewhere in the month of May 1987. Notice was, therefore, given on June 14, 1987 and as the person did not act in accordance with law despite the notice, the petition was required to be filed interalia praying for rectification of the share registers of the Company and also for deletion of the name of Bipinbhai Lallubhai Mehta and other. In the circumstances, the petitioners have prayed that the delay may be excused.

14. The Secretary of the Company pointed out by filing an affidavit that the petition is barred by law of limitation, delay and latches, acquiescence and waiver. The petition came to be filed after more than five years of the transaction in question. It is required to be noted that the complaint was filed on 18th June 1987, but before that the petitioner No.1 gave a notice to the Company dated 17.6.1987 which is produced at Annexure 'D'. Thus, on behalf of the respondents, it has been pointed out in the affidavit that the statement made in the petition that the petitioners came to know about the same only after the complaint was filed in May 1987 is not correct, and in fact, it is contended that at the behest of the petitioners, the said complaint was filed. By filing an affidavit, it is further pointed out that the petitioners were aware about the transaction in question right from November 1982. Shri Vadilal Lallubhai Mehta, father of respondents No. 2 and 12, was the Chairman and Managing Director of the respondent No. 1 Company. Suhasbhai Vadilal Mehta was the Director of the respondent No. 1 Company and petitioner No. 1 Ramesh Desai was the Administrative Manager of the Company. It is pointed out by the learned Judge in the order that the alleged transaction had taken place on 12, 13, and 25 November 1982. As a matter of fact, on 18.11.92, Suhasbhai Vadilal Mehta had resigned as Managing Director, but had continued thereafter as the Director of the Company. Shri Bipinbhai Lallubhai Mehta was inducted as a Director of the Company and the Managing Director in the meeting of the Board of Directors where both Vadilal Lallubhai Mehta and Suhasbhai Vadilal Mehta were present. Vadilal Lallubhai Mehta and Suhasbhai Vadilal Mehta had resigned from their respective posts on 7th Sept. 1983 and on the same date, the petitioner No.1, R.B. Desai also resigned from the Company. Keeping in mind these dates, the learned Company Judge has pointed out that everything was known to and within the knowledge of the petitioners and especially petitioner No.1, who was holding not only an important position in the Company but was also Power of Attorney holder, and in fact one cheque was signed by him. Thus, even if it is taken for granted that the amount was utilized, it was within the knowledge of the petitioner No.1. It is contended in the affidavit by the affected respondents that the amount has not been utilized for the purpose of purchasing the shares. Shares have not been transferred at that time or soon after the amount was taken from Santosh Starch and paid to C. Doctor & Company which was a shareholder. There is nothing on record to show that the share held by C Doctor & Company were transferred on the alleged transaction. Rectification of Register is a main question. When the shares stand in the name of C. Doctor & Company there is no question of rectification.