C.A. No. 84 of 2010 in C.P. No. 7 of 2009. Case: Coromandel Engineering Co. Ltd. Vs Dr. K. Balasundaram and Ors.. Company Law Board
| Case Number | C.A. No. 84 of 2010 in C.P. No. 7 of 2009 |
| Judges | Lizamma Augustine, Member |
| Issue | Company Law |
| Citation | [2010] 159 CompCas 561 (CLB) |
| Judgement Date | July 12, 2010 |
| Court | Company Law Board |
Order:
Lizamma Augustine, Member, (Chennai Bench)
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This is an application under Section 403 of the Companies Act, 1956, read with regulation 44 of the Company Law Board Regulations, 1991, filed by Respondent No. 7 in a company petition, seeking permission to proceed in terms of the joint development agreement dated May 23, 2008 entered into with Respondent No. 2, the company. The applicant is a real estate developer.
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The company petition is filed by Respondent No. 1 under Sections 397 and 398 of the Companies Act, alleging oppression and mismanagement by Respondent No. 3 to Respondent No. 6 seeking to:
(1) set aside sale deeds dated December 9, 2005, December 20, 2005 and July 21, 2007 executed by the company in favour of Respondent No. 5 and Respondent No. 6;
(2) set aside all the memoranda of understanding, agreements etc. in relation to the joint development of 10 acres of company's land; and
(3) direct investigation into the affairs of the company, etc.
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Respondent No. 2 company has been promoted on March 31, 1998 by the father of Respondent No. 1 (the Petitioner in the company petition), Respondent No. 3 and Respondent No. 4, with a paid-up capital of Rs. 35 lakhs, divided into 35,000 equity shares of Rs. 100 each. Respondent No. 1 who holds 5,185 shares in the company, has moved a company petition against Respondent No. 3 and Respondent No. 4, his brothers, and others. Respondent No. 1 claims 25 per cent. stake in the company as against the admitted case of 14.81 per cent. by the contesting brothers. The Petitioner/Respondent No. 1 in the company application says that Respondents Nos. 3 and 4 had stripped the company of its properties by way of three sale deeds and that he came to know about the three alienations made from 2005 to 2007 only after conducting a search in the office of the Registrar of Companies. The contention of the rival group is that the company sold the vacant lands only to the extent required to discharge the liabilities, most of which existed from the time of their father. The details of payments and receipts are available at pages 8 and 9 of the counter affidavit filed in the company petition. According to the Petitioner 6.63 acres of land out of 10 acres of vacant land belonging to the company were sold to Respondents Nos. 6 and 7, the sons of Respondent No. 5 in the company petition at a cost far below the market value of such property on such dates. The contesting Respondents says that the sale price...
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