Oppression-mismanagement petition under Sections 241-242 not maintainable if winding up sought as principal relief; subsequent withdrawal post-objection does not cure defect or prejudice respondents' maintainability defence.

O R D E R

(PER: BENCH)

The present Company Petition bearing no. CP/7/241/AMR/2024 (hereinafter referred to as the “Petition” or “CP 7/2024”) was filed on 17.05.2024 (Diary No. 694) jointly by Sri Veera Bhoga Vasanta Rayalu Sabbavarapu (hereinafter referred to as the “Petitioner No. 1” or “P-1”) and Smt. Nirmala Sabbavarapu (hereinafter referred to as the “Petitioner No. 2” or “P-2”) through Special Power of Attorney dated 15.05.2024 executed by the P-2 in favour of the P-1 (hereinafter P-1 and P-2 collectively referred to as the “Petitioners”), under Sections 241 to 244 of the Companies Act, 2013 (hereinafter referred to as the “CA, 2013”) read with Rule 11 of the National Company Law Tribunal Rules, 2016 (hereinafter referred to as the “NCLT Rules”) against M/s Sunray Green Space Private Limited (hereinafter referred to as the “Respondent No. 1” or “R-1 Company”), Sri Appalaraja Varma Indukuri (hereinafter referred to as the “Respondent No. 2” or “R-2”), Smt. Seshakumari Indukuri (hereinafter referred to as the “Respondent No. 3” or “R-3”), Sri Narayanaraju Mukala (hereinafter referred to as the “Respondent No. 4” or “R- 4”), Smt. Venkata Lakshmi Mukala (hereinafter referred to as the “Respondent No. 5” or “R-5”), Sri Ayyanna Patrudu Chintakayala (hereinafter referred to as the “Respondent No. 6” or “R-6”), Smt. Padmavathi Chintakayala (hereinafter referred to as the “Respondent No. 7” or “R-7”), Murthy & Associates (hereinafter referred to as the “Respondent No. 8” or “R-8”) and Registrar of Companies for the State of Andhra Pradesh (hereinafter referred to as the “Respondent No. 9” or “R-9” (hereinafter R-1 to R-9 collectively referred to as the “Respondents”) seeking the following main reliefs:

a) Declare the acts of the R-2 to R-8 as oppressive and in a manner prejudicial to the interests of the R-1 and the Petitioners;

b) Declare that the R-2 is disqualified as director under Section 164(1)(g) of the CA, 2013 and consequently all the board meeting conducted after his disqualification as illegal, null and void;

c) Pass an order for winding up of the R-1 Company and distribute its assets among its members.

d) Direct the R-2 to R-8 not to interfere in the affairs of the R-1 Company and declare that they are oppressors and they mismanaged the affairs of the R-1 Company and permanently injunct them from interfering in affairs and management of R-1 Company and consequently pass appropriate orders to punish them by invoking Sections 337 to 341 of the CA, 2013.

e) Declare that the R-2 has failed in his fiduciary duties towards the R-1 Company and direct him to reimburse the amounts, which were siphoned off to the R-2's family owned companies/ related parties without authorization and without disclosing interest to the board of directors of the R-1 Company.

f) Declare that the actions of the R-2 to R-7 in entering into contracts and agreements on behalf of the R-1 Company with international reputed brands and hotel operators for operating the golf course, world class spa, resort/ 5-star hotel are in contravention of Section 180 of the CA, 2013 and are null and void.

g) Pass an order directing the R-2 to R-7 to reimburse the amount with interest utilized for activities, which are ultra vires to Memorandum of Association (hereinafter referred to as the “MoA”) i.e. to reimburse Rs.15 crores spent on 5-star resort and to reimburse Rs.2,75,09,505/- spen