JUDGEMENT

(23^rd February, 2023) Justice Anant Bijay Singh; The instant Appeal under Section 421 of the Companies Act, 2013 preferred by the Appellant being aggrieved and dissatisfied by the order dated 20.12.2019 passed by the National Company Law Tribunal (New Delhi Bench) in CP-118(ND)/2013 filed before its predecessor Company Law Board under Companies Act, 1956, wherein Respondent No. 1 herein filed petition for mismanagement of the Respondent Nos. 2 and 3 herein company (hereinafter referred as "Company") and oppression at the hands of Appellant and Respondent No. 3 herein on various grounds, primarily being dilution of his equity, illegal appointment of Appellant herein as the Director on the Board of the Company, illegal sale of the Company's properties and other acts detrimental to the interest of the Company as well as being oppressive to the Respondent No.

1 herein. By which the Tribunal set aside the appointment of Appellant as Director and passed the following orders:

“8. As per the aforesaid facts we find that the act of respondents in diluting the share of the petitioner and including R3 as member of the Board of Director is oppressive to the petitioner. The respondents are liable to render accounts to the petitioner. All financial statements w.e.f. financial year 2012- 13, along with the books of accounts be placed before the petitioner for due inspection. Necessary legal steps to set aside sale transactions of immovable properties done by the illegally constituted Board be initiated through civil courts including Company Appeal (AT) No. 183 of 2020 suits for recovery and/or declaration for cancellation of the sale deeds carried out through an illegally constituted Board.

9. The appointment of respondent no. 3 is hereby set aside in the absence of any documentary proof of his valid appointment.

The petitioner and respondent no. 2 would be only two directors of the respondent company. The increase in the Authorised and Paid up share capital stands reduced to its original state.

Additional shares issued in favour of respondent no. 3 are directed to be cancelled. Fresh Annual Returns shall be filed with the RoC, Jaipur. The equity of petitioner and respondent no. 2 shall be restored to that of 50% each. With respect to alleged illegal sale and transaction of the immovable assets of the company is concerned, the same is outside the jurisdiction of this Tribunal. The parties have already invoked the jurisdiction of the civil courts for necessary action.

10. It would further be expedient to direct the parties to explore a buy in or buy out at valuation of the share of the respondent company as on 31.03.2013.” 2. The facts giving rise to the instant Appeal are as follows:

i) The Respondent No. 1 incorporated the Respondent No. 2 Company M/s Shrimat Mahavir Buildcon Pvt. Ltd. on 20.12.2004 with 50% ownership with 5000 shares with the other 50% ownership being with one Archana Bhansali holding the remaining 5000 shares with authorized, issued and paid-up capital being Rs. 1,00,000. The Respondent No. 2 company is into sale-purchase and development of land parcels, among other things, as per the objects mentioned in the MoA of the company.

Company Appeal (AT) No. 183 of 2020 ii) The said Archna Bhnansali resigned from the directorship of the Respondent No. 2 company on 15.07.2005 and transferred her 50% ownership to Respondent No. 3 who was appointed a director of the company on the even date with one Suresh Saharan also being appointed as the other new director of the company on said date at the instance of the Respondent No. 1 since said Mr. Saharan was an acquaintance of the Respondent No. 1. The appointment of said Suresh Saharan was concealed by the Respondent No. 1 in his petition possibly to make out a false case of board decisions being allegedly made by Respondent No. 2 company without a quorum while in reality all decisions of the board were made by the requisite quorum as required by