IN THE HIGH COURT OF JUDICATURE AT PATNA COMPANY PETITION No.02 of 2007 ---- Harendra Prasad Singh son of Late Chandradeo Singh, resident of Chandra Mahal, Jagat Narayan Lal Road, Kadamkuan, Patna-3. --Petitioner Versus 1. Rupak Limited, a registered company situated at Bakarganj, P.S. Kadamkuan, in the town and District-Patna. 2. Shatrughan Singh son of Late Ram Krishna Prasad Singh, Managing Director of Rupak Ltd. Bakarganj, P.S. Kadamkuan, Patna-4, Permanent Address-Chainpura Village, P.O. & P.S. Murliganj, District- Purnea. 3. Pancham Narain Singh son of Late Ram Krishna Prasad Singh, Additional Director of Rupak Ltd., Bakarganj, P.S. Kadamkuan, Patna-4, Permanent Address-Chainpura village, P.O. & P.S. Murliganj, District Purnea. 4. Manoj Singh son of Bansidhar Singh, Additional Director of Rupak Ltd., Bakarganj, Kadamkuan, Patna-4, resident of Rupak Cinema Compound, P.S. Kadamkuan, Patna-4. 5. Rajendra Prasad Singh son of Late Chandradeo Singh, former Managing Director of Rupak Ltd. Bakerganj, Patna-4, resident of “Arunodaya” Chandra Mahal compound, Jagat Narayan Lal Road, P.S. Kadamkuan, Patna-3. 6. Harsh Kumar Singh son of Rajendra Prasad Singh, Former Director of Rupak Ltd., Bakarganj, Patna-4, resident of “Arunodaya”, Chandra Mahal Compound, Jagat Narayan Lal Road, Kadamkuan, Patna-3. 7. Gautam Kumar Singh son of Rajendra Prasad Singh, Former Director of Rupak Ltd. Bakarganj, Patna-4, Resident of “Arunodaya”, Chandra Mahal Compound, Jagat Narayan Lal Road, Kadamkuan, Patna-3. 8. Rajeev Singh son of Ram Mohan Singh, Former Director of Rupak Ltd., Bakarganj, Patna-4, resident of Rupak Cinema Compound, P.S. Kadamkuan, Patna-4. 9. Shekhar Singh son of Baleshwar Singh, Former Director of Rupak Ltd., Bakarganj, Patna-4, Resident of Rupak Cinema Compound P.S. Kadamkuan, Patna-4. 10. Digambar Lal son of Late Rit Lal Das, Former Secretary of Rupak Ltd., Bakarganj, Patna-4, Resident of Dariyapur Gola, Patna. 11. Laxman Lal Das S/o Nilambar Lal Das, Former Director of Rupak Ltd., Bakarganj, Patna-4, Resident of Dariyapur Gola, Patna. 12. Aruna Singh W/O Rajendra Prasad Singh, Resident of “Arunodaya” Chandra Mahal Compound, Jagat Narayan Lal Road, Kadamkuan, Patna-3. 13. Arvind Singh son of Late Ram Chandar Prasad Singh, Resident of Chainpura Village, P.O. & P.S. Murliganj, District-Purnea. - 2 - 14. Rakesh Kumar Singh son of Not known, former Peon of Rupak Ltd., Bakarganj, Patna-4, Permanent Resident of Chainpura Village, P.O. & P.S. Murliganj, District Purnea. -- -- Respondents. ---- For the petitioner : M/s Kalyan Kumar Ghose, Abhay Kumar Shambhu & Shantanu Bhattacharjee, Advocates For respondents No.2 and 5: Mr. R.A.Singh, Advocate For respondents no.1 and 4 : M/s J.S.Arora, Ajay Kumar & Ravi Bhatia, Advocates ----- O R D E R 34. 27.02.2009 This company petition has been filed by Mr. Harendra Prasad Singh against Rupak Limited, a registered Company, as well as its Director, share holders and other concerned persons for winding up the said Rupak Limited, a registered company, under the provisions of the Companies Act, 1956 and for consequential reliefs. 2. Admittedly, the said petitioner Mr. Harendra Prasad Singh is a share holder and his claim has been supported by two other share holders, namely M/s Birendra Kumar Singh and Nagendra Singh, who are intervenors in the instant case and belong to the family of the petitioner. It is also an admitted fact that the company in question has been duly registered under the provisions of law and is functioning since 1947 as per its memorandum of association and articles of association (Annexure-1) for various objects numbering 43 and one of them was to exhibit, distribute and produce films in different languages and deal in cinema goods, theatrical purposes, dance, carnival etc. 3. It is also not in dispute that the company had 1,68,998 - 3 - share holders of Rs.10 each, out of which the petitioner along with his two supporters, namely M/s Harendra Prasad Singh, Birendra Kumar Singh and Nagendra Singh held only 16,000 shares, i.e. about 10% of the entire share capital. It is also an admitted fact that in the year 1947, the company took lease for 51 years of about 25 kathas of land at Bakarganj, Patna from its owners and constructed a cinema hall commonly known as “Rupak Cinema”. However, before the expiry of the said period of lease, the owners filed Eviction Suit No.28 of 1995 for eviction of the company on the ground of breach of the tenancy. The said suit continued and is still pending, but in the year 1998, the lease itself expired. 4. It is also not in dispute that much thereafter Birendra Kumar Singh, the brother of the petitioner Harendra Prasad Singh, filed Title Suit No.08 of 2005 before the learned Munsif, Patna, claiming that the property on which the Rupak Cinema Hall was constructed was a joint family property and he was entitled to a share therein. Apart from that, he has also filed a petition in Eviction Suit No.28 of 1995 praying that the eviction suit be not disposed of in terms of any compromise between the parties to the suit and he may be added as a party to the suit, but the said petition was rejected by the trial court and the order of the trial court was upheld by the High Court in civil revision. However, Nagendra Singh, the other brother of the petitioner Harendra Prasad Singh, also filed a similar petition in the eviction suit for the same relief which is still pending and due to these matters, the eviction suit could not be disposed of even after - 4 - so many years. 5. It is claimed that after 1998 six kathas, five dhurs of the said property was purchased by some of the members of the company and others from the owners of the property and hence the landlords-plaintiffs gave an offer to the defendant-Company that they would give to the defendants their purchased six kathas five dhurs of land, but the remaining area should be vacated by the defendants-Company, whereafter the plaintiff-owners would construct a mult-storyed building thereon and a certain portion in the said complex would be given to the defendants. The said offer was put before the general body of the company on 30.09.2005 in its annual general meeting, when it was resolved to accept the said proposal, especially because after the expiry of the period of lease in the year 1998, they had no defence left in the eviction suit. Accordingly, a compromise petition by both the parties was filed in the eviction suit on 13.09.2006 on the aforesaid terms along with a term that on the purchased six kathas five dhurs of land, the company would construct a Cinema Hall. 6. The allegation of the petitioner in the instant company petition is that the respondents have demolished the Cinema Hall and have sold building materials, machines, furniture, equipments, cooling fans etc., the respondents have manipulated the accounts of the company and have cheated the creditors, investors and share holders, the company is not running as per the memorandum of association and articles of association, as a result of which their - 5 - licence has been cancelled by the District Magistrate and the Cinema Hall was closed due to exhibition of unsocial/ blue films, wherefter the Cinema Hall is running nowhere and that if the company is not wound up immediately, large number of share holders, creditors and investors will suffer huge irreparable loss. 7. So far as the above allegations are concerned, it is quite apparent that the said Cinema Hall was constructed on a lease hold which expired more than a decade back in the year 1998 and for eviction of the respondent-Company, the admitted landlords have filed Eviction Suit No.28 of 1995 against the respondent-Company in which after the expiry of the lease in the year 1998, the defendants had no defence left for continuing in the premises in question and hence the compromise petition filed in the eviction suit cannot be said to be against the interest of the company and in the said circumstances, the structures of the building and its contents have to be removed in the interest of the company. 8. So far the allegation of the petitioner for exhibiting anti social/ blue films by the company is concerned, no doubt the earlier licence was cancelled by the District Magistre due to some allegations, but subsequently the Collector again gave licence to the company for running business which is clearly proved by Annexure- N, whereas the earlier matter regarding cancellation of licence of the Company is sub-judice before the Commissioner in Appeal No.05 of 2004 and the criminal case initiated on the said issues is also sub- judice since much before the filing of the company petition. In the - 6 - said circumstances, the matters being sub-judice and the respondents having taken due legal steps, this court cannot legally take a definite view one way or the other. 9. So far as objects of the company are concerned, the memorandum of association shows that it has 43 objects and running of Cinema Hall is not the only object and is merely mentioned in objects no.1 and 2 and hence the company has taken an overall look of its functioning as per the memorandum of association and articles of association, especially after expiry of the lease of the land on which the Cinema Hall was constructed. Furthermore, from the respective claims and materials of the parties it is apparent that the respondent company is fulfilling the other objects of the company and the petitioner cannot force the company to commit illegality by violating the terms of the lease and the orders of a Civil Court. 10. The respondents have been able to show that the annual general meeting was duly held every year and the respondent- company was being managed by the Board of Directors, but no grievance was raised either before the Board of Directors or in the annual general meeting and after more than ten years, the instant company petition has been filed by the petitioner who along with his two supporters, namely brothers are share holders of less than 10% shares in the company, whereas all the other share holders are supporting the company and furthermore none of the investors or creditors have raised any objection against the company. 11. Furthermore, one of the supporters of the petitioner, - 7 - namely his brother Birendra Kumar Singh, had gone to the extent of objecting to the compromise petition in Eviction Suit No.28 of 1995 which was clearly in the interest of the company and not satisfied with that he had filed a title suit himself bearing Title Suit No.08 of 2005 for a relief which was also against the interest of the company. This clearly shows that the petitioner and his aforesaid two supporters have been raising their own claim for their personal aggrandizement, which is detrimental to the interest of the company. 12. Furthermore, the respondents have been able to show that the petitioner’s claim that the company has suspended its business and is running in severe loss is not correct as the profit and loss account of the company up to the year 2006 shows that the company is continuing in business with profit, whereas balance sheet dated 30.03.2006 shows a surplus of Rs.2.85 lacs as the assets are worth Rs.15,25,000.00 and the liabilities are worth Rs. 12, 40,000.00. The profit and loss account and the balance sheet of the company are being approved every year in the annual general meeting of the company held under Section 161 of the Act in which the Directors are elected/re-elected and other transactions are done. Furthermore, notices of the annual general meeting were being given to the share holders under the provision of Section 53 of the Act by the procedure prescribed therein, but if the petitioner wanted any notice by registered post due to non-receipt of any notice, he could have very well taken steps under sub-section 2(a) of Section 53 of the Act, but he never took any such step as provided in law for more - 8 - than a decade and all of a sudden has filed this company petition. Hence, it is quite apparent that claim of absence of any notice to less than 10% share holders appear to be absolutely frivolous. 13. The respondents have also been able to show that the map of the building to be constructed as per the compromise petition filed in the eviction suit on the land in question have also been prepared for Cinema Hall complex of the company and hence the petitioner has miserably failed to show that the respondents are acting against the interest of the company. So far the shares of the petitioner and his two supporters are concerned, they are themselves not clear what safeguards they want as it is specifically stated by the respondents, including the company that the company is ready to secure their interest as per their share by any means which are felt proper and if they want their share money back, the company is also ready to pay back the same. Hence, no wrongful or illegal act of the respondents has been proved, whereas on the contrary it is quite apparent that the company is taking all legal steps in the interest of its share holders due to which none of them, except the petitioner and his two supporters, have raised any objection at any stage. 14. This case appears to be a last ditch effort in the fight for supremacy as the petitioner and his associates having less than 10% shares have apparently lost against other share holders out numbering them which cannot be deprecated in a democratic set up. Hence, keeping in mind the position of the company as a whole and also seeing that the interest of the share holders do not suffer in the - 9 - fight of power, it will not be proper to encourage such petition, especially as the controversy raised by the petitioners appears to be baseless, frivolous, violative of the provisions of law and against the interest of the company. 15. Accordingly, this company petition is dismissed. Sunil (S. N. Hussain, J.)