1 caal60-11.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY APPEAL LOD.NO.60 OF 2011 Sanjay Suryaprakash Mehta .. Appellant/ Orig.Petitioner Versus SKG Consultants and Engineering Pvt.Ltd. And Ors. .. Respondents/ Orig.Respondents Mr.A.Bookwala, Senior Advocate i/b. B.B.Parekh for appellant Mr.Rahul Chitnis with Vikas Mahangare i/b. M/s.AMK Legal for respondent Nos.1 to 3 CORAM : S.C.DHARMADHIKARI, J. 16th December 2011. P.C.: 1] The present appeal under section 10F of the Companies Act, 1956 impugns an order dated 11th October 2011 passed by the Member (Judicial), Company Law Board (for short CLB) on an application for modification. That application for modification sought modification of the earlier order of the CLB passed on 21st April 2011. 2] Mr.Bookwala, learned Senior Counsel appearing for appellant, submits that the question of law that arises for determination and 2 caal60-11.doc consideration in this appeal is whether the CLB could have in the garb of dismissing an application for modification of its earlier order hold that the appellant – original petitioner is no longer a shareholder and that he is bound by the decisions taken and resolutions passed at the meeting of Board of Directors dated 31st March 2011. When the earlier order was passed, according to Mr.Bookwala, the CLB was aware that the appellant – original petitioner was contending that he was holding 7000 equity shares of the total paid up capital of the company, which is evident from the annual returns for the year 2004 to 2006. The argument was that there is a board meeting held on 31st March 2011 whereat several decisions were taken which are prejudicial to the interest of the petitioner and, therefore, these directions be stayed. 3] In the submission of Mr.Bookwala when the modification was sought, it was pointed out that there are further acts of the contesting respondents which would jeopardise interest of the appellant/ original petitioner further. Therefore, it was requested that the CLB should clarify that its order dated 21st April 2011 operates retrospectively and that would have taken care of the apprehension of the appellant/ original petitioner. Now, by refusing to modify the earlier order the entire appeal 3 caal60-11.doc has been rendered infructuous. 4] On the other hand Mr.Chitnis, learned Counsel appearing for respondents submits that there is no question of law arising for consideration of this court in appeal, which is directed against an interlocutory order. He submits that the original order was passed on 21st April 2011 and from 21st April 2011 which was good 21 days after the meeting of 31st March 2011, the appellant – original petitioner did not move for modification and an application for modification was made on 11th May 2011. The earlier order passed on 21st April 2011 was an ex parte order and for the modification of the same the contesting respondents were heard and they pointed out their version to the learned Member, CLB. On 11th October 2011, refusal to modify the order came. Now the petition is listed for final hearing as pleadings are complete, on 16th January 2012. Therefore, no interference is warranted at this stage. 5] After having heard both learned Counsel and perusing with their assistance some of the documents and the impugned order, I am of the opinion that no question of law arises for determination and 4 caal60-11.doc consideration of this Court in the subject appeal. All that the CLB has done is that by an order dated 21st April 2011, it has directed the parties to maintain status quo in relation to the shareholding pattern and the Board of Directors of the company. It is not the grievance of the appellant – original petitioner that the composition of the Board of Directors has been in any manner altered. His apprehension is that by relying upon the resolutions and decision of the subject meeting, it would be urged that the appellant – original petitioner is no longer a share holder of the respondent No.1 company. Now the petitioner is relying upon certain documents which would, according to him, evidence his holding 7000 equity shares constituting 70% of the paid up share capital of the company. The board resolutions of the meeting held on 31st March 2011, may refer to certain aspects with regard to shareholding pattern but there is nothing in the impugned order which would indicate that the CLB has arrived at any conclusion and particularly as apprehended by the appellant – original petitioner that the appellant is no longer shareholder of the subject company. The very issue with regard to the shareholding of the appellant – original petitioner would be decided at the hearing of the petition by the CLB. I have no doubt in my mind that at that stage, the CLB would consider the 5 caal60-11.doc case of both sides and taking in to account the contents of the documents which have been relied upon. At this tentative and prima facie stage, the CLB has also directed parties that they should after the board meeting, not take any decision which would alter the shareholding pattern or the composition of the board of directors. That is not being done and that is not even the grievance of the appellant. He wanted the order dated 21st April 2011 to have retrospective operation viz., a status quo ante in his favour. That has been declined because the appellant – original petitioner approached the CLB seeking interim reliefs after conclusion of the board meeting. In such circumstances, by no stretch of imagination can it be said that any final opinion has been expressed on merits of the controversy. Once, such is the conclusion that I have reached, then, there is no question of law arising for consideration and determination in the present appeal. This court cannot undertake any further re-appreciation and re-appraisal of the factual material and that too at the tentative and prima facie stage. For all these reasons, the appeal fails and the same is dismissed but with a clarification that any observations of the CLB and particularly with regard to the shareholding pattern of the subject company are tentative and prima facie and shall not influence CLB while rendering its final decision on the petition filed 6 caal60-11.doc by the appellant. 6] All contentions in relation thereto of both sides are kept open. The appeal is dismissed. Company Applications, if any, do not survive in the light of disposal of the appeal and all interlocutory orders shall stand vacated forthwith. No costs. (S.C.DHARMADHIKARI, J)