Ozg Sarfaesi / DRT Lawyer
Ahmedabad | Pune |
Kolkata | Bangalore | Delhi | Mumbai
VoIP Text / Phone
# 09811415837-61-72-84-92-94
Website: http://sarfaesi.ozg.in
Email: debt@liaisoning.com
The issue is really serious. A
fictitious form filed with the MCA portal will change the destiny of Company
and it is more so when the Company is a Private Limited Company and vigorously
planning for expansions. Fictitious filing of Forms with the MCA scheme is very
frequently seen in the recent past in Private Limited Companies and Public
Limited Companies are guarded well in this regard and also it is very rare to
see internal disturbances and groupism in Public limited or the Listed Public
Limited Companies.
The facts are as follows:
1. A Private Limited Company is
incorporated with three promoters and the promoter named "A" has
taken all the risk in establishing the Company.
2. The Company has flourished
within a year due to work done by the promoter "Mr.A".
3. Two other outsiders have
evinced interest in acquiring the shares of the Company and these two
shareholders can be referred to as "B" and "C".
4. "Mr.A", being the majority
in the Company, has processed the issue of induction of new shareholders
"B" and "C" in the Company.
5. Apart form other directors,
"Mr.A" and newly inducted shareholders "Mr.B" and
"C" were also made as directors of the Company.
6. At one of point of time, all
other directors barring "Mr.A", "Mr.B" and "C"
have expressed their interest in exist from the Company.
7. "Mr.A" could ensure
investors to acquire the shares of out-going shareholders.
8. At this point of time,
"Mr.A" and "Mr.B" and "Mr.C" were the directors
of the Company. "Mr.A" and "Mr.C" are husband and wife.
9. There were difference of
opinions between "Mr.A" on one part and "Mr.B & C" on
the other hand.
10. While "Mr.B &
C" constitute majority of the Board, they have appointed many of his
relatives as his directors and uploaded forms with the MCA portal.
11. "Mr.A" was in
actual control of the Company and he could ensure uploading of few other forms
with the MCA portal as if the Board has appointed some of his men as
"Directors".
12. While the things stand at
this, as "Mr.A" is in actual control of the Company, "Mr.B &
C" have approached Company Law Board under section 397/398 of the
Companies Act, 1956 seeking drastic measure against the Company including the
investigation under section 237.
13. The Company Law Board has
passed certain interim orders in favour of "Mr.B & C".
14. While "Mr.B &
C" press for orders against the Company which is in actual control of
"Mr.A", "Mr.A" too has a grievance with the presence of
fictitious forms with the "ROC".
15. "Mr.A" wants the
fictitious forms to be removed form the MCA portal, however, he can not allege
oppression and mismanagement against "Mr.B & C" as technically
this can lead to winding-up the Company or appoint an independent Board and
people to take care of the Company
Analysis:
1. Facts of the case referred to
above, exposes the seriousness in availability of easy uploading of forms with
the MCA portal.
2. Once a Form is uploaded, and
brought to the knowledge of the Company Law Board, then, it is really difficult
to get the Form removed unless the Company Law Board passes an order.
3. Many Petitions under section
397/398 of the Act involves disputed facts and as such it will definitely take
time for the adjudication before the Company Law Board.
4. The shareholders, the majority
or the minority will be in trouble with the presence of Forms with the MCA
portal as those Forms have visibility.
5. The very functioning of the
company can be brought to a grinding halt with these fictitious forms and with
fictitious resolutions.
6. These are happening in real
time and its real problem.
7. The technological advancements
like MCA scheme further complicates the proceedings under section 397/398 of
the Companies Act, 1956 and people will very easily criticize the role of
Company Law Board on one ground or other.
8. But, the Company Law Board has
to think of many issues, the procedure, the settled principles and it is not
easy to give an instant order based on some version.
9. In many cases before the Company
Law Board under section 397/398 of the Companies Act, 1956, there can be
illegality on the part of both contesting groups and as such everyone lacks the
confidence to confidently get their case represented before the Company Law
Board.
Conclusion:
This issue of illegal uploading
of Forms with the MCA portal of ROC is a bigger challenge for the corporate
functioning and also it doubles the responsibility of the Company Law Board
which already discharges complicated responsibilities given the limitations.
Ozg Sarfaesi / DRT Lawyer
Ahmedabad | Pune |
Kolkata | Bangalore | Delhi | Mumbai
VoIP Text / Phone
# 09811415837-61-72-84-92-94
Website: http://sarfaesi.ozg.in
Email: debt@liaisoning.com
