Satori Global Limited Vs Shailja Krishna (NCLAT Delhi)
NCLAT Delhi held that the NCLT has no jurisdiction to decide the validity or otherwise of the `Gift Deed’ more so when `fraud’ and `coercion’ is alleged.
Facts- M/s. Satori Global Limited (The Company), was incorporated in the year 2006 and the Petitioner Ms. Shailja Krishna and her Husband Mr. Ved Krishna were the original Promoters and the only Shareholders of the said Company.
The authorized Share Capital of the Company was Rs.2 Crs./- and the subscribed Paid-up Capital was Rs.3Lakhs/- as on 2006. Initially, Ms. Shailja Krishna subscribed to 5,000 Equity Shares and the remaining 25,000 shares were subscribed to Mr. Ved Krishna. While so, Mr. Ved Prakash resigned from the directorship of the Company which was accepted in the Board Meeting held on 01.02.2007, and in his place, Mr. Nirupam Mishra was inducted as Director of the Company.
As per Form 20B, the Petitioner was holding more than 98% of the shareholding of the Company by way of 39,500 Equity Shares in her name and remaining 500 Shares were held by Mr. Nirupam Mishra. During 2010, there were matrimonial disputes between the Petitioner and her Husband Mr. Ved Krishna, as a result of which, it is averred that her Husband has obtained her signature on blank papers under the threat of coercion and subsequently Mr. Ujjwal Agarwal was inducted as an Independent Director vide appointment dated 15.12.2010. It is averred by the Petitioner that she had never consented to the same and did not have any knowledge of the same.
Using the blank signed documents of the Petitioner it was shown that the Petitioner had resigned from the Company on 17.12.2010. It was stated by the Petitioner that there was no occasion for her to resign from the Company and that the Resolution dated 17.12.2010 is fabricated. She had left for Kolkata on 16.12.2010 and had come back only on 01.02.2011 and therefore as on 17.12.2010 she was not even in station. It is stated by the Petitioner that as per the list of Shareholders filed by the Company under signatures of Mr. Ved Krishna and Mr. Ujjwal Agarwal the Petitioner was shown as s Shareholder holding 98% of the Equity Shares as on 24.09.2011.
Conclusion- We hold that the Petition is not maintainable as we are of the considered view that for satisfaction of the criteria as stipulated under Section 399 of the Act, the question whether the `Gift Deed’ is valid or not is the crux of the matter and keeping in view the facts of the attendant case on hand, we are of the earnest view that the NCLT has no jurisdiction to decide the validity or otherwise of the `Gift Deed’ more so when `fraud’ and `coercion’ is alleged. Having held that the Petition is not maintainable, the other issues raised regarding the Articles of Association and the conversion from the Private Limited to a Public Limited Company and whether the forfeiture of Shares amounts to reduction of Shares, is not being delved into.
FULL TEXT OF THE NCLAT JUDGMENT/ORDER
1. Challenge in these Company Appeals viz. Comp. App. (AT) Nos. 379 & 395 of 2018 is to the Impugned Order dated 04.09.2018 passed by the National Company Law Tribunal, Allahabad Bench, in C.P. IB No.107/ND/2013, filed by the Petitioner Ms. Shailja Krishna under Sections 397 & 398 of the Companies Act, 1956, (hereinafter referred to as ‘The Act’). By the Impugned Order, the NCLT has allowed the Company Petition with the following directions:
“46. Petition filed by the Petitioner under Section 397 and 398 of the Companies Act, 1956 is allowed with cost. Resolution passed in the alleged Board meeting Dt. 15.12.2010 and 17.12.2010 are set aside. Petitioner is restored as Executive Director of the R 1 company with immediate effect. It is also declared that the Petitioner holds 39500 shares of the R1 company. The transfer of 39500 equity shares carried out by respondent no. 1 Dt. 18.11.2011 relying upon the instrument of transfer allegedly by Petitioner in favour of Respondent no. 5 is declared as null and void and of no consequence.
47. The respondent no. 1 is further directed to delete the name of the Respondent no. 5 as owner of 39500 equity shares from the register of shares and include the name of the Petitioner as the lawful and exclusive owner of 39500 equity shares issued by respondent no.1. Respondent no. 5 ls further directed to handover the physical possession of the share certificates containing 39500 shares to the Petitioner within 15 days from date of order.
48. We have found that there is overwriting and manipulation in the share transfer form, copy of which is attached with Company Application no. 14/2016. We have also observed that the share transfer form was issued by Registrar of Companies on 1st October 2010 which was valid only up to 1st December 2010 but, the share transfer form was allegedly executed on 17.12.2010. We have also observed that Registrar of Companies was having no power to extend the validity of share transfer form under Section 108 (1-D) of the Companies Act, 1956, when the form was invalid on the date of execution of document itself. Under the above provision, validity could have been extended only in case where validity of the document has expired after execution of the document. It is also found that Form 7 C which was submitted before Registrar of Companies was incomplete. No particulars are given regarding the fees paid for extension of validly in column 10 of the Form 7 C, whereas it was a mandatory condition. It is also found that validity of the share transfer form was extended up to 12 November 2011, but date of passing the order is not clear from the signature and stamp of the ROC. The role of the then ROC/AROC who has extended the validity of the share transfer form upto 12 November 2011 has been found doubtful which needs inquiry by the Ministry of Corporate Affairs.
49.Certified copy of the order may be issued to the Petitioner, respondent. Designated Registrar is also directed to send the copy of the order to Secretary Ministry of Corporate Affairs for taking appropriate action in this matter. Copy of the order may also be send to the Registrar of Companies for compliance of the order.”
2. Since both these Appeals deal with common facts and issues, these Appeals are being disposed of by this Common Order.
3. Briefly put, the facts in the instant case are that M/s. Satori Global Limited (hereinafter referred to as ‘The Company’), was incorporated in the year 2006 and the Petitioner Ms. Shailja Krishna and her Husband Mr. Ved Krishna were the original Promoters and the only Shareholders of the said Company. The authorized Share Capital of the Company was Rs.2 Crs./- and the subscribed Paid-up Capital was Rs.3Lakhs/- as on 2006. Initially, Ms. Shailja Krishna subscribed to 5,000 Equity Shares and the remaining 25,000 shares were subscribed to Mr. Ved Krishna. While so, Mr. Ved Prakash resigned from the directorship of the Company which was accepted in the Board Meeting held on 01.02.2007, and in his place, Mr. Nirupam Mishra was inducted as Director of the Company. It is averred by the Petitioner that as on 25.09.2010, as per Form 20B, the Petitioner was holding more than 98% of the shareholding of the Company by way of 39,500 Equity Shares in her name and remaining 500 Shares were held by Mr. Nirupam Mishra. During 2010, there were matrimonial disputes between the Petitioner and her Husband Mr. Ved Krishna, as a result of which, it is averred that her Husband has obtained her signature on blank papers under the threat of coercion and subsequently Mr. Ujjwal Agarwal was inducted as an Independent Director vide appointment dated 15.12.2010. It is averred by the Petitioner that she had never consented to the same and did not have any knowledge of the same. Using the blank signed documents of the Petitioner it was shown that the Petitioner had resigned from the Company on 17.12.2010. It is stated by the Petitioner that there was no occasion for her to resign from the Company and that the Resolution dated 17.12.2010 is fabricated. She had left for Kolkata on 16.12.2010 and had come back only on 01.02.2011 and therefore as on 17.12.2010 she was not even in station. It is stated by the Petitioner that as per the list of Shareholders filed by the Company under signatures of Mr. Ved Krishna and Mr. Ujjwal Agarwal the Petitioner was shown as s Shareholder holding 98% of the Equity Shares as on 24.09.2011.
4. It is submitted by the Petitioner in the Company Petition that no Notice of any Meeting whatsoever was given to her and on 24.09.2011, an allotment of 50,000 Equity Shares were made to Stocknet International Limited. The date of transfer of shares has been recorded as 18.11.2011. It is submitted that a Police Complaint was filed by the Petitioner on 30.08.2011, but the Police did not take any action. It is further stated that despite having been allotted 5,000 Equity Shares, which number further increased to 39,500 Shares to the Company never actually sent her the physical Share Certificates and they continued to be in the possession of the Company and her Husband Mr. Ved Krishna. It is also submitted that the Petitioner was wrongfully moved from the Board of Directors though she had held 39,500 Equity Shares out of 40,000 Equity Shares, but the entire Shareholding has been arbitrarily transferred to Mrs. Manjula Jhunjhunwala her Mother-in-Law, without any consideration and in contravention to Clause 16 of the Articles of Association of the Company. It was averred in the Company Petition that the Gift Deed does not contained the appropriate Stamp Duty and was prepared only on purchased Stamp Paper. The alleged Resolution dated 15.12.2010 is in contradiction of Clause 53 of Articles of Association, which provides that the quorum necessary for the transaction of business at a Board Meeting shall be two. It is averred that this alleged Resolution was passed by Mr. Nirupam Mishra alone and therefore appointment of the third Respondent was void-ab-initio. On account of forfeiture of the Shares on 29.03.2009, the Membership again got limited to only two Members. The Company was allegedly converted into Public Company by EGM on 20.06.2011 and therefore on the relevant date on 17.12.2010, the Company was still governed by the Articles of Association adopted by the Company which forbids Transfer of Shares without any consideration vide Gift Deed to Mrs. Jhunjhunwala.
5. Based on the arguments put forth by both the sides, the NCLT framed the following issues:
“i. Whether the alleged act of Respondents 2-4 comes under the purview of ‘Oppression and Mismanagement’ under Section 397 and 398 of the Companies Act, 1956?
ii. Whether the Petitioner is not eligible to present this Petition under Section 397 and 398 of the Act in view of bar provided under Section 399 of the Companies Act, 1956?
iii. Whether the alleged transfer of 39500 equity shares dated 17th December 2010 by way of gift deed by the Petitioner to her mother-in-law, is valid?
iv. Whether the alleged resignation letter dated 17.12.2010 of the Petitioner from the post of Executive Director of Respondent No. 1 Company is valid?
v. Whether the alleged Board Resolution dated 17th December, 2010 regarding acceptance of the alleged resignation of the Petitioner from the post of Executive Director of the company is valid?”
6. Submissions of the Learned Sr. Counsel appearing on behalf of the Appellants:
