Marpol_Pvt_Ltd_CA_143_2010 - Company Law Board Mumbai Bench

BEFORE THE COMPANY LAW BOARD,MUMABI BENCH, AT MUMBAIPRESENT: SHRI KANTHI NARAHARI, MEMBER (JUDICIAL)COMPANY APPLICATION NO.143 OF 2010INCOMPANY PETITION NO. 72 of 2008IN THE MATTER OF M/S MARPOL PRIVATE LTD.BETWEEN:1. Mr. Shambhu A Pai Panandiker,S/o late Mr. Atmaram X PoiPalondicar,2. Shambhu A Pai Panandiker (HUF)Through Mr. Shambhu A PaiPanandikr, KartaS/o late Mr. Atmaram X Poi3. Mrs. Anjali S Pai Panandiker,W/o Mr. Shambhu A. PaiPanandiker, R/o 1908 HollyHill Dr. Austin, TX 78746,United States of Americal4. Dr. Atmaram (Atman) S PaiPanandiker,S/o Mr. Shambhu A. PaiPanandiker,CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.

25. Mr. Chetan S. Pai Panandiker,S/o Mr. Shambhu A PaiPanandikerPetitioners 1 to 5 residing at1908 Holly Hill Dr. Austin, TX78746. United States of America6. Atmaram Poi Palondicar Trading& Investment Company Pvt. Ltd.(APPTICO) having its registeredOffice at Panandiker Chambers3 rd Floor, M. L. Furtado Road,Margao, Goa – 403 601.…Petitioners/Org.ApplicantsAND1. M/s Marpol Private Ltd.,2. Mr. Rohan R. Pai Panandiker,S/o late Mr. RamachandraA PaiPanandiker3. Dr. Vishwanath A. Pai PanandikerS/o late Mr. Atmaram X PoiPalondicar4. Mr. Shanu A. Pai PanandikerS/o Mr. Atmaram X Poi PalndicarAll are having their office atPanadiker Chambers, 2 nd floor,CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.2

3M. L. Furtado Road, P.O. No.700,Margao, Goa – 403 601.5. Mr. Kamlesh A. Pai Panandiker,S/o late Mr. Atmaram X PoiPalondicar having his office atPanadiker Chambers, 2 nd floor,M. L. Furtado Road, P.O. No.700,Margao, Goa – 403 601.and residing at 19425 Vine Ridge Road,Excelsior, Minnesota, 55331 USA.6. Mr. Rohit R. Pai Panandiker, S/oLate Mr. Ramchandra A PoiPanandiker, having his office atPanandiker Chambers, 3 rd floor,M. L. Furtado Road, P.O.No.700,Margao, Goa – 403 601 andResiding at Block No.1, 5 th floor,Landscape Pinto Park,D. B.Bandodker Marg, CampalPanaji, Goa – 403 001.7. Mr. Ramachandra A Pai Panandiker (HUF)Through Mr. Rohan R. Pai Panandiker,Karta S/o late Mr. Ramchandra PaiPanandiker, residing at S/4C Maria Julia,2 nd floor, Nr. Jawaharlal Nehru StadiumFatorda, Goa – 403 602.8. Mr. Shanu A Pai Panandiker (HUF)Through Mr. Shanu A. Pai Panandiker, KartaS/o late Mr. Atmaram X Poi PalondicarResiding at Krishna, Amrutnagar,Near Smt. Parvatibai ChowguleCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.3

4College, Gogol, Margao 403 602.9. Mr. Vishwanath A. Pai Panandiker (HUF)Through Dr. Vishwanath A Pai Panandiker,Karta, S/o late Mr. Atmaram X PoiPalondicar residing at Panandiker Chambers,4 th floor, M. L. Furtado Road,Margao, Goa – 403 601.10. Mr. Kamlesh A Pai Panandiker (HUF)Through Mr. Kamlesh A. Pai Panandiker,Karta S/o late Mr. Atmaram X Poi PalondicarResiding at 19425 Vine Ridge Road,Exceslsior, Minnesota, 55331 USA.11. M/s. Ramchandra A Pai PanandikerTrading & Investment Co. Pvt. Ltd.12. M/s Vishwanath A Pai PanandikerTrading & Investment Co. Pvt. Ltd.13. M/s Shanu A Pai Panandiker Trading& Investment Co. Pvt. Ltd.14. M/s Veda Pai Panandiker Trading &Investment Co. Pvt. Ltd.R11 to R14 having its registered office atPanandiker Chambers, 3 rd floor,M. L. Furtado Road, Margao,Goa – 403 601.15. Mr. Rahool S Pai PanandikerS/o Shanu Pai Panandiker residingAt C/o Boston Consulting Group,Sharda Apartments, Flat No.23,CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.4

54 th floor, Opp. Jai Hind College,Mumbai – 400 021.16. Mr. Raj S. Pai Panandiker S/o ShanuPai Panandiker residing at Apt. No.7,565 Saratoga Avenue, Santa Clara,California 95050 USA17. Ms. Manisha V. Pai Panandikerd/o Vishwanath Pai Panandikerresiding at B3/12, 2 nd floor,Vasant Vihar, New Delhi – 110 057.18. Mr. Ravi V. Pai PanandikerS/o Vishwanath Pai Panandikerresiding at 531, A Sector 3,R. K. Puram, New Delhi 110 022.19. Mrs. Kunda S. Pai Panandiker W/o ShanuPai Panadiker residing at Krishna,Amrutnagar, near Smt. ParvatibaiChowgule College, Gogol, Margao,Goa – 403 602.20. Mrs. Mangala K. Pai PanandikerW/o Kamlesh Pai Panandikerresiding at 19425Vine Ridge Road,Excelsior, Minnesota 55331 USA21. Ms. Veda K. Pai Panandikerd/o Kamlesh Pai Panandiker residingat 211 N. 5 th Street, New York,NY 11211 USACA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.5

622. Ms. Kaya K. Pai Panandikerd/o Kamlesh Pai Panandiker presentlyresiding at 1240 West Monroe St. Chicago,IL 60607 and alternate address being2024 West Walton St. Chicago. IL 60622.23. Mrs. Rajani R. Pai PanandikerW/o Late Ramchandra Pai PanandikerResiding at S/4C Maria Julia, 2 nd floor,Nr. Jawaharlal Nehru StadiumFatorda, Goa – 403 602.…RespondentsANDAtmaram Pai Panandiker CharitableTrust, A Trust registered and formedon 17 th November 1990 having itsregistered office at Margoa, Goa,through its trustee Kamlesh AtmaramPoi Panandikar, having its address atPanandikar Chambers, 3 rd floor,ML Furtado Rpad, Margao,Goa – 403 601.…ApplicantCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.6

7PRESENT FOR PARTIES:1. Shri Shaunak Kashyap, Advocate- For Applicant Trust2. Shri Abhaya Kashyap, Advocate – For 3 and 53. Mr. Iswar Nankani, Advocate – For R6 to 8, 11, 13, 15,16, 19 & 23.4. Shri Atul Rahadhyaksha, Sr. Counsel – For R15. Shri Rahul Chitnis & Shri Pankaj Khode, Advocates- For Petitioner6. Mr. Lalit Jain, Advocate - For R2 and 4O R D E RThe present application is filed praying this bench to implead theapplicant as respondent No.24 in the above company petition andsought direction to rectify the register of the company in order toreflect the applicant’s shares as mentioned in the will. The counselappearing for the applicant trust submitted that the applicant trust is abeneficiary under the will of the late Mr. Atmaram Pai Panandikerunder his Public Testament (Will) dated 30 th September 1993 and isentitled to the shares of this Company belonging to the late Director.The applicant trust was unaware of its being the beneficiary under theCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.7

8will which makes it a substantial shareholder in the RespondentCompany.2. It is submitted that despite entitlement of the trust to the shares ofthe Respondent Company, the shares were not transmitted to it. TheRespondent Company transmitted the shares to the 5 sons of the lateMr. Atmaram Pai Panandiker in 2004. This was patently illegal andthe transmission was done in direct contravention of the trust’s rightfulownership of shares under the will. However, the applicant trust hadno knowledge of either the transmission or the will at that time. Basedon an inquiry initiated by one of its Directors, the Board of RespondentCompany realized its inadvertent mistake and resolved to reverse theillegal transmission on 13.09.2010 in the course of its Board meetingon the said date. The respondent company subsequently sent a letterdated 14.09.2010 informing the applicant trust of the mistake made inthe transmission of shares as well as entitlement of the applicant trustto the shares. The board of the respondent company appears to havebeen deceived into illegal transmission of shares. These shares shouldhave transmitted to the applicant trust. It is pertinent to mention thatthe trust came to know of the will for the first time and its entitlementto the shares under the aforementioned will only on 14.09.2010 videthe letter of the respondent company dated 14.09.2010. Therespondent company has recognized the suppression and fraudCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.8

9involved in the instant case and that two directors have already agreedto part with the illegal transmitted shares on learning of the nature andcharacter of the transmission to them. It is imperative that therespondent company is directed to rectify its register and cancel theillegal transmission of shares which rightfully belong to the applicanttrust. The directors that are holding the illegally transmitted sharesmust be directed to return the same at the earliest. It is submitted thatthe case of the petitioner must be looked at critically to realize how theinstant suppression was material. The recent stand of the petitioner isindicative of two factions within the company where one faction is thatof Respondent No.3 and Respondent No.5, which is in majority with50.05% shares and the other faction consists of the remaining brothersand their families with the latter attempting to gain majority throughthe instant case. Thus, if the will was not suppressed the faction ofrespondent No.3 and respondent No.5 would have a clear majority asthey control the Trust and the premise of the instant petition i.e. ofillegal control would not be tenable. The instant petition deserve to bedismissed on the ground of fraud and suppression as the will wouldmaterially alter the ground realities and the petitioner would be unableto content that the faction of respondent Nos.3 and 5 were guiltyof illegal dilution to take over control of the company. The applicant isa substantial shareholder in the respondent company and holds thebalancing shares which would determine the control of the company.CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.9

10The applicant is a necessary party before the instant tribunal, as itsshareholding would have a substantial impact on the outcome of theinstant case. Furthermore, the entire controversy for control of therespondent company cannot be resolved without the applicant being aparty. It is submitted that the applicant is a necessary and a properparty and its presence would enable this bench to effectively andcompletely adjudicate upon and settle all questions involved in theinstant case. Therefore, it is prayed that the Hon’ble Bench be pleasedto implead the applicant as respondent No.24 in the presentproceedings.3. The respondents 6, 7 and 23 filed their reply and submitted thatthe present application is filed by the applicant seeking to implead asrespondent No.24 in the present company petition, for rectification ofregister of respondent company and for various other reliefs. We saythat a copy of the application was served upon our advocates on orabout 15 th September 2010. Our advocates by their letter dated 18 thSeptember 2010 addressed to advocates for the applicant soughtinspection of documents referred to and/or relief upon by the applicantin the application. As no response was forthcoming, vide letters dated27 th September 2012 and 7 th October 2010, our advocates once againrequested for inspection as sought for in the earlier letter. It issubmitted that in response to the above the advocates for the applicantCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.10

11belatedly by their letter dated 16 th October 2010 (received by ouradvocates on 18 th October 2010) purported to fix appointment forinspection between 18 th -20 th October 2010, time to be fixed by ouradvocates as the matter/the application was scheduled to come up forhearing on 21 st October 2010. The said letter was replied by ouradvocates vide letter dated 19 th October 2010 thereby stating thatinspection fixed was at a short notice and was only to create a falserecord and nothing else. Thereafter, vide letters dated 10 th November2010 and 20 th November 2010, our advocates once again soughtinspection of the documents. The same has not been responded to tilldate. Surprisingly on 2 nd December 2010 the advocates for theapplicant by their letter of even date gave notice that the aboveapplication will be moved on 8 th December 2010 for hearing. Also bythe said letter, notice was also given that the applicant was ready togive inspection of documents “as per convenience of our advocates”and in respect thereto were requested to contact Mr. A. A. Khan,Advocate at the numbers mentioned therein. Repeated attempts weremade to contact Mr. A. A. Khan who when finally contacted informedour advocates that the documents of which inspection is to be givenwere not available and the same are expected only on Monday, 6 thDecember 2010. All the above facts were recorded by our advocatesvide their letter dated 3 rd December 2010. The applicant is onlycreating a false record purporting to offer inspection and nothing else.CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.11

12Despite repeated requests and reminders the applicant/their advocateshave not given inspection of documents referred to and/or relied uponin the present application and therefore the application be dismissedwith costs and/or they are now estopped from relying upon the same.We crave leave to file a further affidavit as and when inspection ofdocuments is given by the applicant. At the outset the application astaken out by the applicant is an abuse of process of law and is contraryto the basic principles of law and not maintainable. The reliefs assought, the applicant has to file appropriate/different proceedingsbefore the court of competent jurisdiction and not file an application inthe present petition and hence the reliefs as prayed for the applicantcannot and ought not be granted and the application be dismissed inlimine. Admittedly on their own showing the shares stood transmittedto the five sons of late Mr. Atmaram Poi Palondicar in the year 2004.The cause of action to apply for reversal of transmission arose in 2004and therefore the applicant ought to have filed appropriate proceedingswithin 3 years from the transmission of shares i.e. by 2007 andtherefore the present application is barred by the law of limitation. Thecontention in the present application feigning ignorance about thetransmission is patently false and to say the least, far fetched. Thedeponent has by making such false statement has rendered himselfliable for perjury and an attempt to mislead this Hon’ble Tribunal. Theapplicant is a Trust of which the Respondent No.3 to 5 are Trustees.CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.12

13The same persons viz. the respondent Nos.3 to 5 are also legal heirs ofLate Mr. Atmarama X. Poi Palondicar. The same three persons viz. therespondents Nos.3 to 5 are the transferees of the shares of the said lateMr. Atmarama X. Poi Palondicar, The same three persons viz. theRespondent Nos.3 to 5 have paid amounts to the Trust being value ofshares transmitted in their names. The trust after having received theentire consideration of the shares (which is suppressed by theapplicant) from the 5 sons of Late Mr. Atmarama X. Poi Palondicar,cannot claim the shares again without any justification or cogentreasons. The present application is therefore liable to be dismissedwith costs. It is submitted that the preliminary condition forrectification of register of the company is that an instrument of transferor intimation of transfer should be received by the company, whichinstrument/intimation has till date to our knowledge not been receivedand therefore, on this count alone the present application deserves to bedismissed with cost. Without prejudice to the above, it is submittedthat the application is made on basis of a will, which is admittedly notprobated and no probate has been granted by a court of competentjurisdiction in regard of the will in question. The will which is notprobated is not admissible in evidence as per the provisions of IndianSuccession Act and hence cannot be relied/looked upon. On this countalone also the present application deserves to be dismissed with costsas it has no legs to stand. It is submitted that the respondent No.3CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.13

14with whom the deponent is colluding and conniving, had informed allthat the applicant Trust cannot hold shares in any private limitedcompany and therefore the said shares have to be sold only to theHUFs of five sons of late Mr.Atmarama Poi Palondicar. TheRespondent No.3 had in fact calculated the share of each and valuethereof, which was paid and accepted by the Applicants Trust. Evenotherwise the present application is in the nature of rectification of theregister of the members of the company. The applicant therefore,should adopt the procedure prescribed under the Companies Act for thesame and cannot bypass the prescribed procedure.4. The respondents 8, 13, 15, 16 and 19 have filed their reply andhave taken the similar stand as taken by the respondents 6, 7 and 23.Therefore, the same is not brought in to avoid repetition of pleadingsexcept few paras. It is submitted that the applicant has not given theinspection of the documents as relied upon in the application. Theapplication is an abuse of process of law and the applicant has to fileappropriate/different proceedings before the Court of CompetentJurisdiction and not to file an application in the present petition.Admittedly the shares have been transferred to the five sons of late Mr.Atmarama Poi Palondicar in the year 2004 and the cause of actionarouse in 2004 and the applicant ought to have filed appropriateCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.14

15proceedings within 3 years from the transmission of shares. Therefore,the application is barred by the law of limitation.5. The petitioners have filed an application being CA No.189 of2010 under regulation 44 of the Companies Act, 1956 (CLBRegulations 1991) seeking dismissal of the company applicationNo.143 of 2010. Shri Rahul Chitnis, Learned Counsel for thepetitioners submitted that on or about 21 st July 2008, the applicantsfiled the above petition under Sections 397, 398, 402 and 403 of theCompanies Act, 1956 against the respondents complaining the acts ofoppression and mismanagement of the affairs of the company.6. It is submitted that in or about September 2010, one AtmaramPanandiker Charitable Trust (hereinafter referred to as, ‘the said trust’)took out the present application for impleadment of the said trust asRespondent No.24 and for rectification of the register of the companyunder Sec.111. The applicants state that the said trust in companyapplication No.143 of 2010 claims to be beneficiary under the willdated 30 th September 1993, of the late Mr. Atmaram Pai Panandikarand thus claims to be entitled to the shares of the company belongingto the late Mr. Atmaram Pai Panandikar. However, till date the saidtrust has failed to produce the original will and/or documents insupport of the alleged claim. The said Trust has filed the saidCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.15

16application, under Section 111, presumably of the Companies Act,1956, the same is not maintainable for the reasons set out hereinafter.The applicants submit that the Sub-section (10) of Section 111 of thesaid Act reads as follows:Sec.111 Power to refuse registration and appeal against refusal.Sub Sec.10 Every appeal or application to the [Tribunal] undersub-section (2) or sub-section (4) shall be made by a petition in writingand shall be accompanied by such fee as may be prescribed.7. In the circumstances, the applicants submits that since the actmakes specific provision under sub-section (10) for filing a petition inwriting which shall be accompanied by the prescribed fees. Thus, thesaid Act contemplates the filing of an independent petition. The saidtrust has neither filed any independent petition nor paid the prescribedfees. The said trust ought to follow the due process of law and ought tobe directed to file appropriate proceedings. The said Trust isattempting a shortcut, which it ought not to be allowed to take. ThisHon’ble Board, therefore has no jurisdiction to hear the saidapplication and on this ground alone, the said application is required tobe dismissed with costs. It is submitted that the said Trust cannotapply for impleadment as Respondent No.24 in company petitionNo.72 of 2008. As on date, the said trust is not even a member of thecompany. In any event, the said trust is neither a necessary nor properCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.16

17party to company petition No.72 of 2008 and hence, cannot seekimpleadment. Company Petition No.72 of 2008 is a petitioncomplaining against the acts of oppression and mismanagement and noallegation has been leveled against the said trust in company petitionNo.72 of 2008. Further, the said trust has no locus whatsoever. ThisHon’ble Board, therefore, has no jurisdiction to hear the saidapplication and on this ground alone, the said application is required tobe dismissed with costs. Further the application is barred by limitation.Admittedly, the company transmitted the shares to the five sons of thelate Mr. Atmaram Pai Panandikar in 2004. The company purportedlyaddressed a letter dated 14 th September 2010 informing the said trust ofthe purported mistake made in the transmission of shares. The saidtrust is silent about the circumstances in which the companypurportedly realized its mistake and purportedly resolved to reverse thepurported illegal transmission and the reason for realizing the mistake.The company having transmitted the shares in 2004, the cause of actionto apply for reversal of transmission arose in 2004 and the said trustought to have filed a company petition within three years from thetransmission of the shares, i.e. on or before 2007. This Hon’ble Board,therefore has no jurisdiction to hear the said application and on thisground alone, the said application is required to be dismissed withcosts. Hence, the said application, filed by the said trust does notcomply with the provisions of Section 111 of the said Act, and is exCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.17

18facie not maintainable on the face of the said application and ought tobe dismissed on this ground alone. Further, the said applicant is anabuse of process of law. The applicants submit that the issue whetherthe said application is maintainable or not ought to be decided at theoutset, as a preliminary issue. In the circumstances, this Hon’bleBoard be pleased to dismiss the said application as it is notmaintainable. Therefore, it is prayed that this Hon’ble bench may bepleased to dismiss the company application being CA No.143 of 2010as not maintainable.8. Heard the learned counsel appeared for the parties, and perusedthe pleadings and documents filed by them. The pleadings contains theapplication being CA No.143 of 2010 consists of 39 pages and thereply filed by the respondents 6, 7 and 23 consists of 25 pages and thereply filed by the respondents 8, 13, 15, 16 and 19 consists of 25 pagesand the application being CA No.189 of 2010 filed by the petitionerscontains 22 pages. Except these no other documents are on records ason the date of hearing of these applications i.e. 12.4.2012. It was madeclear in the open court that no other documents will be entertained todecide these applications to avoid controversies. After analyzing thepleadings the issues that are felt for consideration and need to beaddressed is i) whether the application filed by the trust seekingdirections to implead itself as respondent No.24 and rectify the registerCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.18

19of the company to reflect the applicant’s shares as mentioned in thewill and ii) whether the application filed by the petitioners being CANo.189 of 2010 seeking dismissal of CA No.143 of 2010 has made outany ground to allow the application by dismissing CA No.143 of 2010.Since the two applications are inter related, hence decided to disposeoff by passing common order. The trust filed the application beforethis bench on 16 th September 2010 duly verified on 15.09.2010 by oneof the trustees. However, there is no mention about the regulationunder which the application is filed. From the perusal of theapplication at para 1 of page 10, in the details of the applicant, thus it isstated and the relevant para is extracted hereunder: “that the presentapplication is being filed for impleadment and rectification undersection 111 of the Register of the Respondent Company. The applicantis Atmaram Pai Panadikar Charitable Trust, which is a trust, formedon 17 th November 1990 and registered at Margao, Goa.” From theabove details and also from para a, b of the main relief at para 5, it isclear that the applicant sought reliefs mainly to seek impleadment ofapplicant as respondent No.24 in the main CP and sought direction torectify the register of the company. The applicant has not complied thebasic requirement and the application is not in order on the ground thatthere is no mention about the clauses of CLB regulations to file theapplication by seeking certain interim releifs. The fee prescribed forinterlocatary application made to the CLB for an interim order orCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.19

20direction shall be accompanied by a fee of Rs.50/- as per Sub-section(2) of Section 3 of CLB (fees on applications and petitions) Rules,1991. The applicant remitted fee of Rs.50/- by way of D.D. dated5.09.2010. Mere remitting a fee of Rs.50/- is not sufficient to dealwith the application without mentioning any specific regulation. Asper Regulation 17 of CLB Regulations 1991 any application filedsubsequent to filing of the petition applying for any interim order ordirection shall as far as possible, be in form No.2 in Annexure II andshall be accompanied by an affidavit verifying the application in themanner laid down in Regulation 14. According to the aboveregulations any applications filed subsequent to filing of the petitionshall be under Regulation 17 and the CLB may in exercise its inherentpowers under Regulation 44 make such orders as maybe necessary forthe ends of justice or to prevent abuse of the process of the bench asper Regulation 44. Therefore, I am of the view that without mentioningany rules and regulations of the Company Law Board, the applicationis vague and liable to be dismissed at threshold. Even without goinginto technicalities with regard to the non-mentioning of relevantprovision of law, the application cannot be entertained on the groundthat the applicant sought plural remedies. When the applicant seeksplural remedy, which is inconsequential to one another the applicationcannot be entertained as per Regulation 20 of CLB Regulations. Thesaid regulation is reproduced hereunder for better appreciation:CA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.20

21Regulation 20. Plural Remedies – A petition shall be based upon asingle cause of action and may seek one or more reliefs providedthat they are consequential to one another. In the presentapplication, the applicant sought two reliefs which are completelyinconsequential to one another, it is to say that seeking impleadment inthe main petition as one of the respondents is in relation to the mainpetition and seeking direction to rectify the register of members is aseparate cause of action, both cannot be prayed in one applicationwhich are not consequential. Therefore, the application is liable to bedismissed even on that ground. Irrespective of above I would like todeal in detail with regard to the reliefs of the applicant. In theapplication the applicant has mentioned section 111 of the Act seekingdirection to the company to rectify the register of members whethersuch relief can be prayed without following due procedure ascontemplated in the Act, Rules and Regulations. To file a petitionunder section 111 of the Companies Act, 1956 seeking directions asper the said provisions, one has to file a independent petition ascontemplated under Sub-section 10 of Section 111. The relevantprovision of law is reproduced hereunder: Sub-section 10 “everyappeal or application to the (Tribunal) under sub-section (2) or subsection(4) shall be made by a petition in writing and shall beaccompanied by such fees as may be prescribed.” In this regard, thecompanies (fees on application) Rules 1999 prescribes Rs.500/- as feeCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.21

22at Sr.No.9 of its schedule. In the present case, the petitioner has notpaid the requisite fee of Rs.500/- to maintain a petition under Section111 of the Act and it is not an independent petition. To file a petitionunder section 111 of the Act the following documents are to beannexed as per Regulation 18 of the CLB Regulations as mentioned inAnnexure III thereto. As per the said regulations, in case the petition ismade by any other persons the following documents are to be annexed.1) documentary evidence in support of the statements made in thepetition including the copy of the letter written by the petitioner to thecompany for the purpose of registering the transfer of, or thetransmission of the right to any shares or interest in, or debentures asalso a copy of the letter of refusal of the company. 2) Copies of thedocuments returned by the company. 3) Any other relevant documents4) Affidavit verifying the petition 5) Bank draft evidencing payment ofapplication fee 6) Memorandum of appearance with a copy of theboard’s resolution or the executed vakalatnama, as the case may be 7)Two extra copies of the petition. In the present application, theapplicant filed a copy of the board resolution dated 13.9.2010 andcopy of the Public testament and also vakalatnama and verified theapplication. Except these, no other documents filed along with theapplication. I am in complete agreement with the stand taken by thepetitioners in CA No.189 of 2010 with regard to the maintainability ofthe petition on the ground that the Companies Act contemplates theCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.22

23filing of an independent petition in accordance with Sub-section 10 ofSection 111. Therefore, the application is liable to be dismissed on thisground alone. In so far as the rectification of the register of membersof the company is concerned, even on the merits of the case it isevident that the applicant has not made any application to the companyseeking rectification of register of members on the basis of thedocument which they relied upon. Even as per the CLB Regulationsthere should be averments in the petition in support of the reliefs whichthe petitioner is claiming. It is also required that there should bedocumentary evidence in support of the averments made in the petition.The applicant has not averred that they made an application to thecompany and the company refused to rectify the register or that thecompany has not given any reply inspite of the written request orrepresentation made thereto. There is no documentary evidence toestablish that the applicant approached the company seekingrectification. The stand of the respondents and the petitioners is thatthe shares of the late Mr. Atmaram Pai Panandikar have beentransmitted to the five sons in 2004 itself and the applicant cannotapproach this bench even for seeking rectification in the year 2010. Itis stated that the limitation to file a petition for seeking rectification ofshares is within 3 years from the date of transmission of shares i.e. onor before 2007. The claim of the applicant that the trust is abeneficiary under the will dated 30.09.1993 of the late Atmaram PaiCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.23

24Panandikar and they came to know in the month of September 2010.The photo copy of the will which is titled as Public Testament is inhand written and some of the pages are not able to read and not able tounderstand its contents. The Respondents have strongly objectedrelying upon the will by the applicant trust on the ground that theapplicant has not produced the original will for their inspection in spiteof repeated requests and also contended that the will has not beenprobated and is not admissible in evidence as per the provisions of theIndian Succession Act. I do not want to go into the validity and itsveracity of the will at this stage in view of the reason that I am notdeciding the aspect of the entitlement of the will or deciding any issueson the basis of the will. Without making any observations with regardto the will, it is apparent from the statement of the applicant itself thatthe will is dated 30.09.1993 and the applicant seeking remedy out ofthe will in the year 2010 is belated. So far as on the merits of theimpleadment of the applicant in CP No.72 of 2008 is concerned, it isan admitted fact that the applicant is not a member of the company andthe application is filed in the year 2010 on the basis of will dated30.09.1993 claiming that the trust is entitled to the shares of thecompany belonging to the late Mr. Atmaram Pai Panandikar. Theapplicant has not given any cogent reasons for seeking impleadment tothe main petition. From the averment of the applicant I do not see anyground or reason to allow the applicant to the main petition. MereCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.24

25surmises one cannot be added to the petition. If any party is impleadedon the basis of assumptions and presumptions as stated by the applicanttrust in its application at para (i) and (j), it would definitely prejudicethe interest of the other parties who are opposing the impleadment.The petitioners in their CA No.189 of 2010 have taken the stand thatthe trust is not a member of the company and neither is a necessaryparty nor proper party to CP No.72 of 2008 and also stated that thepetition which they filed complained the acts of oppression andmismanagement and no allegation has been leveled against the saidtrust. I completely agree with the stand of the petitioners in theirapplication and I am of the view that the applicant trust is neithernecessary nor proper party to the proceedings. On the overall I am ofthe view that the intention of the applicant (trust) seeking impleadmentis completely after thought and a clear abuse of process of law. Inview of the reasons as stated above, the application being CA No.143of 2010 filed by the trust is frivolous and vexatious and liable to bedismissed. Hence, the CA No.143 of 2010 is dismissed as notmaintainable. However, CA No.189 of 2010 is allowed. Accordinglythe issues are answered.Dated this 20 th day of April, 2012.(KANTHI NARAHARI)MEMBERCA No.143 of 2010 in CP 72 of 2008M/s. Marpol Pvt. Ltd.25