C.A. No. 595/2009 in C.P. No. 83(ND)/2009. Case: G.R. Singhal and Others Vs Taurus Englobe Ltd. and Others. Company Law Board
| Case Number | C.A. No. 595/2009 in C.P. No. 83(ND)/2009 |
| Judges | D.R. Deshmukh, J. (Chairman) |
| Issue | Companies Act, 1956 - Sections 111, 397, 398, 399, 399(1)(a), 41, 634A |
| Judgement Date | May 23, 2012 |
| Court | Company Law Board |
Order:
D.R. Deshmukh, J. (Chairman), (New Delhi Bench)
1. Respondent No. 3 Sh. Vilas Gupta has filed an application C.A. No. 85/2009 for dismissal of C.P. No. 83/2009 on the ground that the petitioners not being the members of Taurus Englobe Ltd., in short the company, do not have the right to apply under section 399 of the Companies Act, 1956 ('the Act'). Taurus Englobe Ltd. (R-1) is the company in which the petitioners have alleged acts of oppression and mismanagement by the respondents. The family business of the parties comprises of (a) Taurus India Ltd., (b) Taurus Polymers (P.) Ltd., and (c) Taurus Englobe Ltd. Sh. Pawan Singhal P2, Sh. Kishan Gupta R-2 and Sh. Vilas Gupta R-3 are the sons of Sh. G.R. Singhal P-1. Admittedly in a previous C.P. No. 31/2007 filed by Sh. Vilas Gupta R-2 herein on 28th March, 2007 a family settlement dated 28th April, 2007 was reached between the parties herein. Clause 2(iv) of the family settlement provided as under:
(v) That till the time the division/partition/settlement is effected, each of the party herein shall hold equal share, (i.e., 25 per cent) in each of the companies/business and accordingly inter se transfer of shares within the parties hereto shall be done.
2. On 1st May, 2007 C.P. No. 31/2007 was disposed of in terms of the memorandum of family statement ('MFS') by a consent order.
3. In C.P. No. 31/2007 by order dated 5th February, 2008 Shri A.R. Ramanathan, former member of the Company Law Board ('CLB') was appointed as facilitator to undertake the responsibility of implementation of the family settlement. On 26th February, 2008 the facilitator passed the following Order:
All parties agree that the Boards of all companies be reconstituted at the earliest. Accordingly the directors as contemplated by the MFS shall take position. The first Board meeting will be held in my presence on 4th March, 2008 at 10.30 AM. The agenda for the Board meeting is to schedule the implementation of MFS and modalities for smooth running of existing business.
4. At the request of Sh. Vilas Gupta the meeting to be held on 4th March, 2008 was rescheduled for 7th March, 2008. Proceedings on 7th March, 2008 were recorded as under:
The scheduled hearing on 8th March, could not take place. The first Board meeting of all the three companies took place before me today. All the 4 directors as per CLB order were present. The minutes of the Board in Draft Form shall be submitted in the next hearing. Meanwhile the counsels from both sides shall submit the schedule of implementation along with set of do's and don'ts to be observed. All the parties agree that they shall not intervene in the day-to-day affairs of each other. Parties shall also disclose at the next hearing the statutory books in their custody. Adjourned to 18th March, (Tuesday) at 11.00 AM.
5. On 14th March, 2008 Sh. Vilas Gupta sent a communication to the facilitator praying for rescheduling the meeting fixed for 18th March, 2008 stating that due to certain unavoidable circumstances, pre-occupation and commitment he would not be able to attend the meeting on 18th March, 2008.
6. On 18th March, 2008 the facilitator did not adjourn the meeting and passed the following orders:
Matter heard. Papers presented by petitioners' group and respondents' group today taken on record. These will be discussed at the next hearing. Petitioner No. 1's counsel would like to file his written submissions on interpretation of family settlement. He will do so by 25th March, 2008. Counter by respondent by 29th March, 2008. Next hearing will take place on 1st April, 2008 at 1.30 PM. Further detailed order will follow on today's hearing.
This is in continuation of my order dated 18th March, 2008.
'Petitioner No. 1 Shri Vilas Gupta was not present today and has sought leave of absence vide his letter dated 14th March, 2008. As per clause 3.3 of the family settlement "till the time family settlement is fully and finally given effect to", the following persons shall be the only directors of all the companies mentioned herein above:
(a) Shri G.R. Singhal
(b) Shri Vilas Gupta
(c) Shri Kishan Gupta
(d) Shri Pawan Singhal
It is clear from the above clause that the above constitution of the Board of directors of all the three companies, viz., Taurus India Ltd., Taurus Polymers (P.) Ltd. and Taurus Englobe Ltd. shall be an interim arrangement "till the time the family settlement is fully and finally given effect to". In conformity with this arrangement all the four parties who were present in the last hearing also participated in the last Board meeting held on 7th of March in my presence. However, the date of the next Board meeting was not decided. Now the next Board meeting...
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