1. The petitioners collectively holding 0.0016 per cent shares in M/s. Birla Corporation Limited (29th respondent-the company) have sought for an investigation into the membership of the company in terms of section 247(1A) of the Companies Act, 1956 (‘the Act’) for determining the true persons who are financially interested in the success or failure of the company or who have been able to control or materially influence the policy of the company. They have also sought for, as an interim measure, imposition of certain restrictions on the shares held by the respondents 1 to 28 in the company, in terms of section 250(2) of the Act.

2. The case of the petitioners is : The company is a part of M.P. Birla Group and has always been known as a Birla company. The respondents 1 to 28 hold, collectively among themselves, 63.8 per cent shares in the company. Respondents 1 to 19 are incorporated companies and respondents 20 to 28 are charitable institutions/societies. All these entities were under the control and management of M.P. Birla till 1990 when he expired. Thereafter, his wife Mrs. Priyamvada Birla came to be in control of these entities. She died in July, 2004. Since these entities held more than 63 per cent shares in the company, the person/persons controlling these entities would be financially interested in the success or failure of the company. Thus, Mrs. Priyamvada Birla was in control of the management and affairs of the company. After her demise, the petitioners were shocked to learn that one Rajender Singh Lodha had applied before Calcutta High Court for grant of probate in respect of a Will stated to have been executed by late Mrs. Birla bequeathing her entire estate in his favour and that he had also been appointed as the executor of the said Will. Other members of Birla family have opposed the grant of probate in favour of Shri Lodha and they have separately sought for grant of probate in respect of two separate Wills said to have been executed by late M.P. Birla and late Priyamvada Birla in July 1982 and that Shri Lodha is contesting these two Wills. Shri Lodha is not a part of Birla family and being a Chartered Accountant was only associated in his professional capacity with many Birla companies. He was never in the management of the company. Now with the Wills being contested, it is not clear as to who is/are in the control of the shares held by the respondents 1 to 28 and it appears that Shri Lodha is seeking to exercise control over the shares held by these respondents. Therefore, there is good reason to find out the relevant facts about the shareholding in the company and this cannot be done unless shares are subjected to restriction in terms of section 250(2) of the Act. Therefore, in terms of section 247(1A) of the Act, suitable orders should be passed and till the investigation is completed, restrictions should be imposed on the shares.

3. Most of the respondents have filed their replies questioning the maintainability of the petition more particularly in view of the pending proceedings before the Calcutta High Court.

4. Shri Sarkar appearing for the petitioners submitted: It is an undisputed fact that respondents 1 to 28 collectively hold more than 60 per cent shares in the company and that they were under the control and management of late Mrs. Birla before her demise. The company, being a Birla company had always been under the control and management of Birlas. Even in the annual report for the year 2003-04, her name is shown as promoter non-executive Chairman. In the same report, it is also shown that the promoters held 66.22 per cent shares in the company. Now that the promoter has expired, it has to be ascertained as to who controls the promoter’s shares. Further, Shri Lodha’s gaining control of the respondents 1 to 28 is in violation of the provisions of Take Over Code as by virtue of this, he would be in a position to appoint majority of directors and control the management and policy decisions of the