Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(NCLT) 1227

NATIONAL COMPANY LAW TRIBUNAL
Rajeev Bhardwaj, Judicial Member, Sanjay Puri, Technical Member
Sanyog Kumar Thakuri – Appellant
Versus
Star Agrotech Pvt Ltd – Respondent
Contempt Petition (CA)/2/2024|CP No.666/241/HDB/2019

Advocates:
For the Petitioners: Shailesh Baheti (CS)
For the Respondents: Vinitha Reddy, Rubaina S Khatoon, Devangi, Y. Suryanarayana

Oppression under Sections 241-242 requires continuous harsh conduct lacking probity prejudicial to shareholder rights; suppression of material facts bars relief; valid director removal not actionable absent oppression.

Headnote:(A) Companies Act, 2013 - Sections 241, 242, 169, 115, 2(55) - Oppression and mismanagement petition by minority shareholder (24%) alleging financial irregularities, denial of inspection, non-holding of meetings, invalid director removal, and failure to provide exit - Tribunal held petitioner approached with unclean hands by suppressing competing business and non-compete clause (Paras 95-96); removal of director validly effected despite procedural gaps as petitioner attended and was heard (Paras 102-106); financial allegations based on suspicion without evidence insufficient for forensic audit or relief (Paras 109-112); non-holding of meetings not oppression of shareholder rights (Paras 116-118); no continuous burdensome conduct lacking probity established, requiring consecutive story of oppression (Paras 125-127) - Petition dismissed with costs of Rs.5,00,000/-, interim order vacated (Para 128).

(B) Doctrine of clean hands - Suppression of material facts disqualifies litigant from relief; applicable to proceedings under Sections 241-242 (Para 96).

(C) Scope of Section 241 - Tribunal cannot interfere with valid director removal unless oppressive/prejudicial; contractual disputes like share consideration outside jurisdiction (Paras 100, 104).

Facts of the case:
Petitioner, holding 24% shares post unchallenged 76% transfer, alleged post-transfer financial manipulations (inflated advances, suspicious repayments, unauthorised loans), denial of record inspection, non-finalisation of accounts, non-holding of AGM/Board meetings, and director removal via compliant procedures under Section 169. Respondents countered with petitioner's breach of non-compete via competing venture, prior mismanagement, and valid commercial transactions.

Findings of Court:
No prima facie oppression/mismanagement; petitioner lacks clean hands; director removal lawful; financial claims speculative; procedural lapses rectifiable, not prejudicial to shareholder rights; reliefs like forensic audit, inspection beyond Tribunal's investigative role under Section 242.

Issues: Whether suppression vitiates petition; locus standi of 24% shareholder; validity of director removal; sufficiency of evidence for financial irregularities; whether non-meetings/denials constitute oppression; entitlement to inspection/forensic audit.

Ratio Decidendi: Oppression requires continuous harsh/wrongful conduct lacking probity forming consecutive story prejudicial to proprietary rights; mere suspicion/grievances insufficient; valid statutory removal not interference-worthy absent oppression; clean hands mandatory (Paras 95-128).

Result: Petition dismissed with costs; interim order vacated.

Table of Content
1. company incorporation and shareholding history (Para 1 , 1 , 2 , 3 , 4 , 5 , 6 , 7 , 38 , 39 , 86 , 87)
2. share transfers and payment assurances (Para 8 , 9 , 10 , 11 , 12 , 18 , 19 , 20 , 21 , 77)
3. alleged financial manipulations and advances (Para 13 , 14 , 15 , 16 , 17 , 30 , 31 , 32 , 33 , 65 , 66 , 84 , 109 , 110 , 111 , 112)
4. director removal procedures and compliance (Para 22 , 23 , 24 , 25 , 26 , 27 , 29 , 58 , 59 , 68 , 88 , 102 , 103 , 106)
5. petition dismissed with costs (Para 28)
6. collateral release and contractual disputes (Para 35 , 36 , 113 , 114)
7. petitioner's competing business and unclean hands (Para 42 , 43 , 44 , 48 , 60 , 92 , 95)
8. no continuous oppression or mismanagement established (Para 94 , 96 , 97 , 104 , 124 , 125 , 126 , 127 , 128)
9. petitioner's locus standi as member (Para 98 , 99 , 100 , 101)
10. non-holding of meetings not oppression (Para 115 , 116 , 117 , 118 , 119 , 120 , 121)

1. This Company Petition No. 666/241/HDB/2019 has been filed by Mr. Sanyog Kumar Thakur (“the Petitioner”) alleging oppression and mismanagement in the affairs of M/s. Star Agrotech Private Limited (“Respondent No. 1 Company/R.1 Company”) seeking the following reliefs:

a. To declare that Respondents No. 2 to 4 are oppressors and are acting against the interests of the Respondent No.1 Company and the Petitioner.

b. To declare that the Petitioner cannot be removed as Director, so long as he holds 72,000 equity shares of the Respondent No.1 Company.

c. To appoint an independent Director as Chairman of the Respondent No.1 Company to conduct the Board and General Body Meetings.

d. To direct the Respondents to release the collateral security provided by the Petitioner.

e. To appoint an Independent Valuer approved by IBBI to conduct a fair valuation of the Petitioner’s shares (taking into account brand value, turnover, etc.), and direct the Respondents to acquire the Petitioner’s shares at such fair value.

f. To appoint an independent auditor to verify the books of accounts of the Company for the years 2017-18, 2018-19, and up to the date of this Company Petition, including conducting a forensic audit in respect of the manipulation of advances, and submit the report to the independent Chairman/Company, followed by approval of the same by the shareholders in the General Meeting for revision of the balance sheets.

g. To declare the Board Minutes dated 27.09.2019 as fraudulent, fabricated, and fictitious.

h. To declare that no Board Meetings were conducted as per law during the 12 months prior to 14.10.2019, the Company has not finalized accounts for the year 2018-19, and has also not conducted the Annual General Meeting in accordance with the provisions of the Companies Act.

i. Direct ROC to prosecute the Respondents for violation of various companies act after carrying out provisions of inspection/investigation.

Case of the Petitioner:

2. M/s. Star Agrotech Private Limited (Respondent No.1 Company/R.1 Company), bearing CIN No. U01135TG2000PTC035897, was incorporated on 18.12.2000, under the Companies Act, 1956. The registered office is situated at Flat No. D-38, II Floor, D-Block, Bharani Complex, Minister Road, Secunderabad, Hyderabad, 500003.

3. The initial Promoter Directors of Respondent No.1 Company were Mr. Sanyog Kumar Thakur1, The Petitioner herein is a subscriber to the Memorandum of Association of R.1 Company and a Promoter Director of the Company, holding 72,000 equity shares (24%) of the Company) Petitioner and Mrs. Jyothi Sankinani, each of whom subscribed to 100 equity shares of Rs. 10/- each.

4. As on 30.09.2004, the shareholding pattern of Respondent No. 1 Company was altered as follows:

5. Thereafter, pursuant to the allotment of shares made on 31.03.2010, the shareholding of Respondent No.1 Company was altered in the following manner:

6. It is submitted that the Petitioner, together with his family and associates held 100% equity in Respondent No. 1 Company since its incorporation and marketed its prod

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2026 Supreme(Online)(NCLT) 1227

NATIONAL COMPANY LAW TRIBUNALRajeev Bhardwaj, Judicial Member, Sanjay Puri, Technical MemberSanyog Kumar Thakuri – AppellantVersusStar Agrotech Pvt Ltd – RespondentContempt Petition (CA)/2/2024|CP No.666/241/HDB/2019

Oppression under Sections 241-242 requires continuous harsh conduct lacking probity prejudicial to shareholder rights; suppression of material facts bars relief; valid director removal not actionable absent oppression.

Cases Referred (3)

NATIONAL COMPANY LAW TRIBUNAL
Rajeev Bhardwaj, Judicial Member, Sanjay Puri, Technical Member
Sanyog Kumar Thakuri – Appellant
Versus
Star Agrotech Pvt Ltd – Respondent
Contempt Petition (CA)/2/2024|CP No.666/241/HDB/2019