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2024 Supreme(Online)(NCLT) 1806
NATIONAL COMPANY LAW TRIBUNAL
Shri Prabhat Kumar, Member (Technical), Shri V.G. Bisht, Hon’ble Member (Judicial)
Urvashi Bharat Khater – Appellant
Versus
Laxsons (India) Private Limited – Respondent
CP. 1017 OF 2020|CP. 1018 OF 2020
For the Appellants/Petitioners: Mr. Nausher Kohli, Mr. Akash Agarwal
For the Respondents: Mr. Pulkit Sharma, Mr. Aman Kacheria, Ms. Sakshi Dube
Allegations of oppression and mismanagement under the Companies Act must demonstrate actionable conduct that is burdensome or wrongful, not mere lack of confidence, and consent negates claims of coercion.
Headnote:(A) Companies Act, 2013 - Sections 241-242 - Petitions filed by a shareholder alleging oppression and mismanagement against family members as directors - Relief sought includes declaration of resolutions as void, restraints on actions by directors, and access to corporate records - Allegations of coercion and fraudulent share transfer made - Court found no evidence of actionable oppression or mismanagement as the conduct of directors was deemed permissible under law. (Paras 8.1, 8.4, 8.6)
(B) Legal Principles - The court held that allegations of oppression must demonstrate that company affairs were conducted in a burdensome, harsh, and wrongful manner, not merely lack of confidence - Consent in share transfers negated claims of non-solicitude. (Paras 7.5, 8.4)
(C)
Facts of the case:
The Petitioner, a director, accused her sons of coercing her into signing documents regarding company assets and shares following the death of her husband; despite her allegations of mismanagement, the court found evidence of her consent to actions taken by the respondents. (Paras 6.6, 6.11)
Findings of Court:
Resolved that the conduct of Respondent Nos. 2 and 3 did not constitute oppression or mismanagement under the Companies Act, and the petitions lacked maintainability due to the Petitioner's own consent and involvement. (Paras 8.4, 8.6)
Issues: The main issues addressed included whether the actions of the company’s directors amounted to oppression or mismanagement and the validity of the share transfer amid ongoing probate proceedings.
Ratio Decidendi: The court ruled that for oppression to be actionable, evidence must show that the management was burdensome or wrongfully conducted; the petitioner's claims were found unsubstantiated by clear evidence of consent to contested actions.
Result: Petitions dismissed.
| Table of Content |
|---|
| 1. petitions filed under companies act for relief against oppression. (Para 1 , 3) |
| 2. relief requests for stay and management oversight. (Para 2 , 4) |
| 3. background on company establishment and family involvement. (Para 5 , 6) |
| 4. legal objections raised regarding share transfers and company management. (Para 7 , 8) |
| 5. court dismisses the petitions. (Para 9) |
ORDER
Per: Prabhat Kumar, Member (Technical)
1. This Company Petition CP 1017/2020 is filed under Section 241 -242 of the Companies Act, 2013 (“Act”) by Urvashi Bharat Khater (“Petitioner”) against Laxsons (India) Private Limited & Others seeking following reliefs:
(a) For appropriate orders, reliefs and directions under Section(s) 241 and 242 of the Companies Act, 2013 to bring an end to the aforesaid acts of oppression and mismanagement perpetrated by Respondent Nos.2 and 3 and for necessary orders and reliefs in respect thereof, including as prayed for herein;
(b) For a declaration that the Impugned 169 Notice, Impugned Resolution, and the Impugned Notice and Agenda are illegal, non-est, null, void and not binding on the Petitioner and/or Respondent No. 1 Company;
(c) For a declaration that the Impugned Transfer of the Impugned Shares is illegal, non-est, null, void and not binding on the Petitioner and/or Respondent No.1 Company;
(d) For a declaration that Respondent Nos.2 and 3 cannot exercise any right, title and/or interest in respect of the Impugned Shares;
(e) For appropriate orders, reliefs and directions under Section(s) 241 and 242 of the Companies Act, 2013 restraining the Respondents from acting in pursuance of and/or taking any steps in furtherance to the Impugned Transfer and/or the Impugned Shares;
(f) For appropriate orders, directions and injunctions ordering. directing and restraining Respondent Nos. 2 and 3 from encumbering, alienating, selling and/or mortgaging and/or creating a lien, charge and/or any encumbrance of any nature whatsoever on the assets and properties of Respondent No. 1 Company;
(g) That this Tribunal be pleased to restrain Respondent Nos.2 and 3 by an order and injunction from convening or holding any general meeting or board meeting of Respondent No. 1 Company;
(h) That this Tribunal be pleased to direct the Respondents to provide copies of all documents, Annual Returns, statutory filings, information, accounts and records of Respondent No.1 Company till date to the Petitioner;
(i) That this Tribunal be pleased to restrain the Respondents, their agents, servants and/or any person claiming through them from in any manner obstructing, or hindering access to all the assets, offices, apartments, out- houses, documents, Annual Returns, statutory filings, information, accounts and records of Respondent No.1 Company which the Petitioner is currently denied access to;
(j) That this Tribunal be pleased to restrain Respondent Nos.2 and 3 by an order and injunction from exercising any rights as a shareholder of Respondent No.1 Company and they be restrained from holding themselves out as shareholders of Respondent No. 1 Company;
(k) That this Tribunal be pleased to remove Respondent Nos.2 and 3 as directors of Respondent No.1 Company and they be restrained from holding themselves out as directors of Respondent No. 1 Company;
2. The Petitioner also filed another Company Petition C.P. 1018/2020 in the matters of Laxsons Properties Pvt Ltd. on 18.08.2020 seeking stay on operation of 169 Notice and Impugned Resolution; appointment of independent forensic auditor for investigation the affairs of the Respondent Company; and an Administrator for managing the affairs, besides other prayers which are similar in nature to the prayers in C.P. 1017/2020. The prayers made in C.P. 1018/2020 are as follows :
a. That pending the hearing and final disposal of this Petition, this Hon'ble Tribunal be pleased to stay the effect, implementation and operation of the Impugned 169 Notice, Impugned Resolution, and the Impugned Notice and Agenda;
b. In the event the Impugned
