1. In this order I am considering Company Petition No. 27 of 2007 filed by Shri Vijay Mehta & Ors. (the petitioners) against M/s. Arlington Spinning & Weaving Mills Ltd. & Ors. (R-1 Company and other respondents) under Sections 397,398,402, 406, 209 and 235 of the Companies Act, 1956 alleging oppression and mismanagement.

2. M/s. Arlington Spinning & Weaving Mills Ltd. was incorporated on 20.08.1990 as a Private Limited Company having its registered office at 48, Manohar Market, Katra Neel, Chandni Chowk, Delhi-110 006 with the Authorized Share Capital of Rs. 10,00,000/- divided into 1,00,000 equity shares of Rs. 10/- each. The total subscribed and paid up share capital of the R-1 Company was Rs. 7,0,700 divided into 74,070 equity shares of Rs. 10/- each. The main objects of the company are to set up, establish, maintain, run, take or give out on lease or for any other consideration factories cloth mills, looms or machines connected therewith and act as spinners, weavers, makers, job-workers, producers, manufactures, dyers, printers, agents, importers, exporters and stockists of all type of natural and synthetic yarns, fibres, fabrics, cloth, textiles and also all types of clothes, garments and to set up factories for the manufacture of any of the machines and to enter into any collaboration and act as consultants, advisers, data banks and take up turn-key assignments for the business.

3. The Counsel for the petitioner pointed out that the P-1 and P-2 are Directors of the R-1 Company and hold 14,880 and 10,850 equity shares respectively in the company. P-3 and P-4 are also shareholders of the Company holding 3260 and 9050 equity shares in the R-1 Company. The Petitioners together with their group hold 38,070 equity shares in the R-1 Company, thus comprising 53% out of the total paid up capital of the company. It is stated 10 equity shares each in R-1 Company are held by S/Shri K. Chandra Sekharan, Han Om Kapoor and Dilip Tuli who are supporting the present action being initiated by the Petitioners. P-1 and P-3 are the promoters and original directors of the R-1 Company. Further, it was pointed out that R-2, 3 and 4 are Directors of the Company, whereas R-5 and R-6 are shareholders of the R-1 Company. R-7 has purportedly entered into an agreement dated 14.02.2005 to sell with the R-1 Company acting through R-2 for the land of the R-1 Company comprising of 183 kanal 17 marla situated at Village Gudhrana, Tehsil Hodal, District Faridabad. It was stated that the said land is the only asset of the R-1 Company, The Counsel for the petitioners pointed out that the R-2 along with R-3 and R-4 in capacity as Directors have in complete breach of their fiduciary duty as Directors and against the interest of the Company and its shareholders sought to sell of the only valuable asset of the company at a grossly under quoted price and have obtained cash consideration for personal gain and enrichment at the cost and expense of the R-1 Company. R-2 to 4 have deliberately kept the Petitioners in the dark about the affairs of the R-1 Company. No notices of the Board meetings have been received by the P-1 and P-2 who are admittedly directors of the R-1 Company. Similarly no notices of the Annual General Meetings have been received by the Petitioners who comprise the majority shareholders of the Company. It was contended that R-2 to R-6 acting in connivance and collusion are now attempting to completely oust the Petitioners from the management and affairs of the R-1 Company. My attention was drawn to a Special Notice dated 12.02.07 purportedly under Section 284 (3) of the Act which was issued to the R-1 Company by R-2, 5 and 6 proposing removal of the P-1 and P-2 from the directorship of the R-1 Company.

4. It was contended that the R-1 Company acting on the request of R-2, 5 and 6 had issued notice dated 27.02.07 calling for an EOGM of the Company on 23.03.07 at the registered office of the Company. My attention was drawn to the resolutions prop