Tony Francis Guiness vs Indekka Software Pvt. Ltd. And ...
2005 Latest Caselaw 119 Bom

JUDGMENT

Karnik D.G., J.

1. Heard the learned Counsel for the plaintiff and defendant Nos. 1, 2 and 3 who appears on private notice.

2. In view of the decision of the Division Bench of this Court in CDT Financial Services (Mauritius) Ltd. v. BPL Communications Ltd., reported in 2004(56) SEBI & Corporate Laws 665, the learned Counsel for the defendant does not object to the jurisdiction of this Court to entertain and try this suit.

3. After entering into the shareholders agreement, the plaintiff and defendant No. 2 formed the defendant No. 1 company. Article 50 of the Articles of Association prescribes that the Board would take decisions by simple majority laid a proviso that certain decisions could be taken only if both the plaintiff and the defendant or their nominees had voted in favour of that resolution. The said article also provides that increase of the share capital of the company including the issuance of further shares would require consent both of the plaintiff as well as of the defendant expressed in the form of positive votes on the resolution. It is the contention of the plaintiff that a resolution for issuance of a further share capital was passed without his consent and he or his nominee director has not voted in favour of the resolution and therefore, further issuance of share capital by the plaintiff is contrary to Article 50 of the Articles of Association.

4. In the alternative, the plaintiff submits assuming that a resolution issuance of a capital has been validly passed, that the resolution has not been followed and shares are issued contrary to the conditions of the resolution. The resolution, a copy of which has been produced on page 148 of the compilation produced by the defendant, resolves that every holder of equity share of the company would be offered two new equity shares for every one equity shares held by him on the date of offer. According to the plaintiff, he being a shareholder was entitled to be offered new equity shares which were proposed to be issued in pursuance of the said resolution but that the new shares were not offered to him. In paragraph No. 32 of the plaint, the plaintiff has pleaded that plaintiff was not informed of the further issue of the share by the defendant No. 1 company and he was not offered the new shares. In paragraph No. 53 of the affidavit in reply, the defendant have denied this and have stated :

I say that in any event, plaintiff was also informed of the further issue of additional share capital of the defendant No. 1 company."

The plaintiff resides outside India. The letter containing alleged offer of shares to the plaintiff was not sent to the defendant by registered post or even under a certificate of posting. The learned Counsel for the defendant states that the letter was sent by ordinary post. The learned Counsel for the plaintiff invites my attention to some previous correspondence and points out that all previous correspondence was sent by electronic mail as well as by courier. Such an important communication as an offer of additional shares has not been sent by either electronic mail or by courier or by registered post or even under certificate of posting. This prima facie raises a serious doubt about the communication. Prima facie, I am satisfied that the defendant have not proved that the offer was sent to the plaintiff. There is no prima fade breach of Article 53(3) of the Articles of Association. Hence, this is a fit case for grant of an ad interim relief.

5. Accordingly, the defendants are restrained by an injunction from in any manner utilising using or exercising any rights in respect pf or under the new shares issued to the defendant Nos. 2 and 3 or in any manner dealing with the new shares till the disposal of this motion.

6. Motion is made returnable early.