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Page 1 of 104 NATIONAL COMPANY LAW APPELLATE TRIBUNAL AT CHENNAI TA (AT) No. 18/2021 Company Appeal (AT) No. 325/2019 (IA No. 580/2021 & 191/2022) (Filed under Section 421 of the Companies Act, 2013) (Arising out of the Impugned Order dated 18/09/2019 in T.C.P. No. 1/2016 (C.P. No. 94/1999) , passed by the National Company Law Tribunal, Single Bench, Chennai) In the matter of : Mr. Shankar Sundaram “Mahalakshmi” 25, Kasturi Ranga Road Chennai – 600 018.
…Appellant Versus 1. M/s Amalgamations Limited 81, Radhakrishnan Salai Chennai – 600 004.
….Respondent No. 1 2. A. Sivasailam (deceased) S/o late S. Anantharamakrishnan “SUDHARMA” 24, Dr. Radhakrishnan Salai Chennai – 600 004 ….Respondent No. 2 3. A. Krishnamoorthy S/o late S. Anantharamakrishnan “Kalyani Mahal” No. 1, Sir Sivsamy Salai Chennai – 600 004 ….Respondent No. 3 4. Simpson & Company Ltd. 861/862, Anna Salai Chennai – 600 004 …..Respondent No. 4 Page 2 of 104 5. Addisons Paints & Chemical Ltd Huzur Gardens Sembium, Chennai – 600 011 ….Respondent No. 5 6. India Pistons Ltd. “Huzur Gardens” Sembiam, Chennai – 600 011.
…..Respondent No. 6 7. Shardlow India Ltd. “Huzur Gardens” Sembiam, Chennai 600 011.
…Respondent No. 7 8. Tractors & Farm Equipment Ltd., 35, Nungambakkam High Road, Chennai – 600 034 ….Respondent No. 8 9. Tafe Access Ltd, 35, Nungambakkam High Road, Chennai – 600 034.
…Respondent No. 9 10. Southern Tree Farms Ltd. 35, Nungambakkam High Road, Chennai – 600 034.
….Respondent No. 10 11. Associated Publishers (Madras) Ltd. 856, Anna Salai, Chennai – 600 002 ….Respondent No. 11 12. Bimetal Bearings Ltd. Strip Mill Plant, “Huzur Gardens” Sembiam, Chennai – 600 011.
….Respondent No. 12 13. IP Rings Ltd, Arjay Apex Centre, 24, College Road, Chennai – 600 006.
…Respondent No. 13 14. Wallace Cartright & Company Ltd. 55/56, St. James Street, London S.W. 1A 1 LQ. U.K. ….Respondent No. 14 Page 3 of 104 15. W.J. Groom & Company (UK), 55/56, St. James Street, London S.W. 1A1 LQ. U.K. …Respondent No. 15 16. Amco Batteries Ltd., 3rd Floor, Tower Block, Unity Buildings, J.C. Road, Bangalore- 560 002. ….Respondent No. 16 17. Amalgamations Valeo Clutch Limited., “J” Gardens, G.N.T. Road, Chennai – 600 010. ….Respondent No. 17 18. TAFE (USA) INC. Memphis, Tennessee 38117, U.S.A. ….Respondent No. 18 19. AMCO Power Systems Limited., Hebbal-Bellary, Jakkur Road, Byadrayampura, Bangalore – 560 092.
….Respondent No. 19 20. Madras Hi-Tech Circuits Limited, C-8 & C-9, Madras Export Processing Zone, MEPS, Chennai – 600 045. ….Respondent No. 20 21. M/s. R.G.N. Price & Co. Chartered Accountants, 861, Anna Salai, Chennai – 600 002.
….Respondent No. 21 22. Mr. S. Balasubramaniam, Director, M/s Addisons Paints & Chemicals Limited, “Huzur Gardens” Sembiam, Chennai – 600 011 ….Respondent No. 22 Page 4 of 104 23. Mr. P.V. Sundaram, Director, M/s. Addisons Paints & Chemicals Limited, “Huzur Gardens” Sembiam, Chennai – 600 011 …Respondent No. 23 24. Mrs. Mallika Srinivasan Sudharma 128, Radhakrishnan Salai Chennai 600 004 ….Respondent No. 24 25. Master Sriram, represented by His father & Natural Guardian Mr. Murali Venkatraman Sri Krishna 126, Dr. Radhakrishnan Salai Mylapore, Chennai 600 004.
….Respondent No. 25 26. Mr. Murali Venkatraman, Sri Krishna 126, Dr. Radhakrishnan Salai, Mylapore, Chennai 600 004.
….Respondent No. 26 Present : For Appellants :
Mr. Ravi, Senior Advocate For Mr. R. Murugan, Advocate For Respondents :
Mr. Krishna Srinivasan, Senior Advocate, For Ms. Geethi Ara, Advocate For R1, R3, R4, R6 to R11, R13, R16 Mr Dwarakesh Prabhakaran, Advocate For R12 Mr. C. Aryama Sundaram, Senior Advocate, For Mr. Thriyambak Kannan, Advocate For R24 to R26 WITH Page 5 of 104 TA (AT) No. 114/2021 Company Appeal (AT) No. 328/2019 (Filed under Section 421 of the Companies Act, 2013) (Arising out of the Impugned Order dated 18/09/2019 in T.C.P. No. 88/ 2016 (C.P. No. 20/2012) passed by the National Company Law Tribunal, Single Bench, Chennai) In the matter of : Mr. Shankar Sundaram “Mahalakshmi” 25, Kasturi Ranga Road Chennai – 600 018 ….Appellant Versus 1. M/s. Amalgamations (P) Ltd., No. 124, (Old No. 81) Dr. Radhakrishnan Salai, Chennai – 600 004.
…..Respondent No. 1 2. A. Krishnamoorthy, ‘Kalyani Mahal’, No. 1, Sivaswamy Street, Mylapore, Chennai – 600 004 ….Respondent No. 2 3. N. Venkatramani ‘Lakshmi’, No. 12, Boat Club Road, Chennai – 600 028.
….Respondent No. 3 4. Mallika Srinivasan, “Westside House” No. 3, Adyar Club Gate Road, Chennai – 600 028 …Respondent No. 4 Page 6 of 104 5. Murali Venkatraman, ‘Shrikrishna’ No. 126, Dr. Radhakrishnan Salai, Mylapore, Chennai – 600 004 …Respondent No. 5 6. Sriram Murali, ‘Shrikrishna’ No. 126, Dr. Radhakrishnan Salai, Mylapore, Chennai – 600 004 …Respondent No. 6 7. Bhavani Krishnamoorthy, ‘Kalyani Mahal’ No. 1, Sivaswamy Street, Mylapore, Chennai – 600 004 ….Respondent No. 7 8. Sita Venkatramani, ‘Lakshmi’, No. 12, Boat Club Road, Chennai – 600 028 ….Respondent No. 8 9. Anantharamakrishnan Venkatramani, ‘Lakshmi’, No. 12, Boat Club Road, Chennai – 600 028 ….Respondent No. 9 10. Gautham Venkatramani, ‘Lakshmi’, No. 12, Boat Club Road, Chennai – 600 028.
…Respondent No. 10 11. Lakshmi Narayanan, ‘Sreenithi’, No. 66, Arts College Road, Coimbatore – 641 018.
….Respondent No. 11 12. Simpson & Company Limited, No. 861/862, Anna Salai, Chennai 600 002 ….Respondent No. 12 Page 7 of 104 13. Addison & Company Limited, No. 803, Anna Salai, Chennai 600 002 ….Respondent No. 13 14. Addisons Paints and Chemicals Limited, Huzur Gardens, Sembiam, Chennai – 600 011 …Respondent No. 14 15. Amalgamations Repco Limited, J. Gardens, GNT Road, Chennai – 600 110.
….Respondent No. 15 16. Amco Batteries Limited Chennai, Addison Building, I Floor, 803, Anna Salai, Chennai – 600 002 …Respondent No. 16 17. George Oakes Limited, 43, Greams Road, Chennai – 600 006.
…Respondent No. 17 18. India Pistons Limited, Huzur Gardens, Sembiam, Chennai – 600 011 ….Respondent No. 18 19. IP Pins and Liners Limited, A1-C, Industrial Estate, Maramalai Nagar.
….Respondent No. 19 20. Shardlow India Limited, Huzur Gardens, Sembiam, Chennai – 600 011.
…Respondent No. 20 21. Simpson & General Finance Co. Ltd, 861-862, Anna Salai, Chennai – 600 002.
….Respondent No. 21 22. Sri Rama Vilas Service Ltd, 861-862, Anna Salai, Chennai – 600 002 …Respondent No. 22 Page 8 of 104 23. Tractors and Farm Equipment Ltd., 861, Annasalai, Chennai – 600 002 …Respondent No. 23 24. Tafe Motors Tractors Ltd, 35, Nungambakkam High Road, Chennai – 600 034 …Respondent No. 24 25. Tafe Access Ltd, 35, Nungambakkam High Road, Chennai – 600 034 …Respondent No. 25 26. Southern Tree Farms Ltd, 35, Nungambakkam High Road, Nungambakkam, Chennai – 600 034 …Respondent No. 26 27. Tafe Reach Ltd, 35, Nungambakkam High Road, Nungambakkam, Chennai – 600 034 …Respondent No. 27 28. Tal Precision Parts Ltd, 35, Nungambakkam High Road, Nungambakkam, Chennai – 600 034 …Respondent No. 28 29. T. Stanes and Company Ltd, 8/23-24, Race Course Road, Coimbatore – 641 018 …Respondent No. 29 30. Stanes Motors (South India) Ltd, 8/23-24, Race Course Road, Coimbatore – 641 018 …Respondent No. 30 31. Stanes Motor Parts Ltd, 8/23-24, Race Course Road, Coimbatore – 641 018 …Respondent No. 31 Page 9 of 104 32. Stanes Agencies Ltd, 8/23-24, Race Couse Road, Coimbatore – 641 018 …Respondent No. 32 33. Stanes Amalgamated Estates Ltd, 8/23-24, Race Course Road, Coimbatore – 641 018 …Respondent No. 33 34. Wheel and Precision Forgings India Ltd, Huzur Gardens, Sembiam, Chennai – 600 011 …Respondent No. 34 35. Associated Publishers (Madras) P Ltd, No. 114, Anna salai, Chennai – 600 002.
...Respondent No. 35 36. Associated Publishers (M) P Ltd, 856, Anna Salai, Chennai – 600 002 …Respondent No. 36 37. Bimetal Bearings Ltd, Huzur Gardens, Sembiam, Chennai – 600 011 …Respondent No. 37 38. BBL Daido Private Ltd, 861, Anna Salai, Chennai – 600 002 …Respondent No. 38 39. Higginbothams Private Ltd No. 116, Anna Salai, Chennai – 600 002 …Respondent No. 39 40. IP Rings Ltd, Arjay Apex Centre, 51/24, College Road, Chennai – 600 002 …Respondent No. 40 41. Speed-A-Way Private Ltd, No. 207, Anna Salai, Chennai – 600 002 …Respondent No. 41 Page 10 of 104 42. The Madras Advertising Company P Ltd, 861, Anna Salai, Chennai – 600 002 …Respondent No. 42 43. L.M. Van Moppes Diamond Tools India P Ltd., Chennai 861, Anna Salai, Chennai – 600 002 ….Respondent No. 43 44. Wallace Cartwright and Co. Ltd. UK, 55-56 St. James Street, Greater London, SW 1A 1LQ.
….Respondent No. 44 45. Tafe International Traktor Ve Tarim, Organize San. Bol.4.Kisim OSB 410. No. 24, 45020 Merkez Manisa, Sirketi, Turkey.
…Respondent No. 45 46. IPL Engine Components P Ltd, 51/24, College Road, Chennai – 600 006.
…Respondent No. 46 47. Tafe USA inc, 1014 Highway 348 West Guntown, MS 38849, USA.
….Respondent No. 47 48. WJ Groom & Co Ltd No. 60, St. James Street, London, SW1A 1LQ, E17, 7PE.
….Respondent No. 48 Page 11 of 104 Present : For Appellants :
Mr. Ravi, Senior Advocate For Mr. R. Murugan, Advocate For Respondents :
Mr. Krishna Srinivasan, Senior Advocate, For Ms. Geethi Ara, Advocate For R1, R2, R7 to R13, R15 to R27, R29 to R36, R39 to R43 & R46 Mr. Dwarakesh Prabhakaran, Advocate For R37 Mr. C. Aryama Sundaram, Senior Advocate, For Mr. Thriyambak Kannan, Advocate For R24 to R26
JUDGEMENT
(Virtual Mode) [Per: Shreesha Merla, Member (Technical)] 1. Challenge in these Appeals TA No. 18/2021 and TA No. 114/2021 in Company Appeal (AT) No. 325/2019, and in Company Appeal (AT) No. 328/2019 respectively under Section 421 of the Companies Act, 2013 (hereinafter referred to as the ‘Act) is to the common Impugned Order dated 18/09/2019 in TCP No. 1/2016 (CP No. 94/1999) and TCP No. 88/2016 (CP No. 20/2012) passed by the National Company Law Tribunal, Chennai Bench, by which common Order, the NCLT has dismissed both the Company Petitions, as devoid of merit. 2. At the outset, a brief history of the various Orders and the reliefs prayed for are being detailed as hereunder for better understanding of the case. The Page 12 of 104 reliefs prayed for in Company Petition TCP No. 1/2016 filed by Mr. Shankar Sundaram against 26 Respondents seeking to implead another 21 Respondents, are detailed as hereunder: a) “Appointment of an independent Administrator to take charge of the affairs of the first respondent, Amalgamations Ltd.
This will be necessary to regulate the conduct of the first respondent and affairs in future as stipulated under Section 402 (a); b) To terminate the appointment of the second respondent as Chairman/Director of the first respondent and also the Chairman and Managing Director of TAFE Ltd. c) To terminate the appointment of Mr. S. Balasubramaniam and Mr. P.V. Sundaram as Directors of Addisons Paints and Chemicals Ltd; and to appoint an independent Chairman and two nominee Directors including Sri K.S. Sundaram (the petitioner’s father) to the Board of Directors of Addisons Paints and Chemicals Ltd..; d) To appoint the petitioner as a Director on the Board of the 1st respondent and entrust him with an office of profit in one of the larger profit making subsidiary companies of the 1st respondent commensurate with the educational qualifications and work experience on an equal footing with the other members, currently working, in the AL Group. e) To order for an independent investigation into the foreign operations of the Amalgamations Ltd. f) To direct the second and third respondents to give detailed accounts, commission received Page 13 of 104 and other benefits received from the first respondent and or other companies of the group and to account and hold the same for the benefits of the other shareholders of the company; g) To issue directions to forthwith stop payment of commission to the second and third respondent which are wholly unjustified and amount to unjust enrichment at the expense of other members.; h) To prepare a scheme of administration to regulate and conduct of the affairs of Addisons Paints and Chemicals Ltd. in future so as to ensure that this company is able to revive and regain its profitable status at the earliest and in particular, providing for voluntary retirement scheme, Y2K complaint, provision of adequate working capital and long term funds and direct other concerns of Amalgamations Group to purchase requirements of paint products from Addisons Paints and Chemicals Limited (5th respondent) i) To declare that the affairs of the first respondent company and its subsidiaries as mentioned in the cause title are to be investigated by an Inspector or Inspectors in terms of Section 235 of the Act. j) For such further or other reliefs as this Hon’ble Company Law Board may deem fit in the facts and circumstances of the case.” 3. The Interim reliefs sought for in TCP No. 1/2016 are as follows: a) “Immediate direction to the first respondent to take steps to provide adequate working capital of Rs. 5 Crores to Addisons Paints and Chemicals Ltd.; Page 14 of 104 b) To convene a Board Meeting of that Company to ensure Y2K compliance;
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