The court upheld the legality of share allotments and asset sales under financial distress, ruling no oppressive conduct by respondents was present.

ORDER

1. The petitioners, initially have filed the petition on 26.03.2009, under Sections 397 and 398 read with Sections 111 , 237, 402, 403 and Schedule XI and other Applicable provisions of the Companies Act , 1956, before the Company Law Board, Additional Principal Bench, Chennai, which was numbered as C.P. No.27 of 2009. Thereafter, Amended Petition was filed before the Company Law Board, Chennai with the same number, viz. C.P. No.27 of 2009, on 10.12.2010.

2. Consequent on abolition of the Company Law Board and establishment of the National Company Law Tribunal, the case has been transferred to this Tribunal and the petition got re-numbered as TP No. 37/HDB/2017. The prayers made in the Amended Petition dated 10.12.2010 are as under:

MAIN PRAYERS

“(a) Declare that the acts of the respondents 2 and 3 are prejudicial to the interest of the respondent no.1 Company and are oppressive against the petitioners.

(b) Declare that the respondents 2 and 3 have failed in their fiduciary duties towards the respondent no.1 company and direct them to reimburse to the company the amount siphoned by them.

(c) Declare the sale of land admeasuring 9 acres 39 guntas (equivalent to 48,279 square yards or 40,367 square yards) at Survey No.146/E and 147/E situated at Thimmapur Village, Kothur Gram Panchayat & Mandal, Mahaboobnagar District, Andhra Pradesh by respondent no.2 and 3 is illegal and without authority and is against the interest of the respondent no.1 company and is oppressive against these petitioners and set aside the sale deed dated 7^th February 2007 between the company and the respondent no.29.

(d) Declare the sale of land admeasuring 9 acres 39 guntas (equivalent to 48,279 square yards or 40,367 square yards) at Survey No.146/A, 146/AA, 146/EE, 147/A, 147/AA, 147/EE and 147/U situated at Thimmapur Village, Kothur Village, Kothur Gram Panchayat & Mandal, Mahaboobnagar District, Andhra Pradesh by respondent no.2 and 3 is illegal and without authority and is against the interest of the respondent no.1 company and is oppressive against these petitioners and set aside the sale deed dated 7th February 2007 between the company and the respondent no.29.

(e) Declare that the alleged allotment of 17,29,000 equity shares made on 19^th May 2008, 10^th September 2008 and 13^th October 2008 to the respondents as illegal and void ab initio and order consequent rectification of Register of Members.

(f) Declare the appointment of respondent no.4 as Director of the company is made in violation of provisions of Companies Act , 1956, hence illegal and void ab initio.

(g) Declare the removal of petitioner no.1 as Director is against the provisions of the Companies Act , 1956 and is oppressive against the petitioners.

(h) Declare the Amendment of Memorandum and Articles of Association as against the provisions of the Companies Act , 1956 and against the interest of respondent no.1 company and is oppressive against the petitioners.

(i) Declare the Extraordinary General Meeting held on 24^th March 2008 is void and is in violation of provisions of the Companies Act , 1956 and all the resolutions passed therein are invalid.

(j) Declare the resolution passed on 19^th May 2008 in the Extraordinary General Meeting for appointment of respondent no.3 as wholetime Director is illegal and payments of remuneration be returned with interest.

(k) Declare the resolution passed on 19th May 2008 in the Extraordinary General Meeting for payment of remuneration to respondent no.2 as void and payment of remuneration be returned with interest.

(l) Declare the Extraordinary General Meeting claimed to be held on 19^th May 2008 without giving notice to these petitioners are bad in