Companies Act 1956

R V SHASTRY (Querist) 13 November 2009 This query is : Resolved
Respected Sir/Madam,
Our's is a Pvt.Ltd.Co.registered under the Companies Act 1956.We are 4 brothers & each of us own 25% shares each after the passing away of our father.Two of my brothers are running the Co. in the capacity of directors.The last EGM was held on 31st August 2005 and since then the Co./directors have not held any AGM/EGM till date.The Annual A/c's & Annual Return's of the Co. has also not been filed for the last continuous 4years. The first directors of the Co. were my father & second brother. They appointed my fourth brother as director by a board resolution DT:2nd October 2009.Now the Articles of Association of the Co.says, “The Directors” means directors for the time being of the Company and “The Board of Directors” means “The Board of Directors” for the time being of the Company. Also The board shall have power at any time and from time to time to appoint any person as director as an addition to the board and any director so appointed shall hold office only till the next AGM and shall then be eligible for
re-election.Now as no AGM or EGM has been held since Aug.2005,does it not imply that the directors are holding office as directors, without authorization from the members vide an AGM or EGM and hence ceased to exist as directors from 1st December 2006. Myself & my 3rd brother had vide our notice DT:28th August 2009, called upon the board to convene an EOGM under Section 169 of Companies Act 1956 and induct us as directors. The board failed to convene the EOGM within the prescribed time limit and hence we as requisitionists have called for holding the EGOM on 16th November 2009, after completing all formalities as prescribed by law.
I hope kind Sir that I have given you the proper back ground to my case and request you to kindly bear with me for all the trouble that I’am giving you.
Now what I would like to know from you kind Sir is,
(1)Do the directors still have the first choice to select one amongst themselves to chair the EOGM on the 16th inspite of the fact that they were never re-elected after August 31st 2005 as no AGM or EGM was held after that.
(2)In the event that one of the directors chair the meeting I’am aware of the fact that they will vote us out because of the casting vote and block the resolution to induct us as directors and in the bargain re-elect themselves as directors and continue their merry illegal ways.
(3)I request you kind Sir to suggest me some legal remedy to address our grievances.
(4)Can we file criminal charges as one of the directors has drawn a big amount under the guise of housing loan in 2006 but no house has been purchased by him and he has invested the money elsewhere. I have the copy of a letter written to him by my father in the capacity of director of the company asking him to repay the loan or else the company will take legal steps to recover the same. Unfortunately my father has passed away and now there is nobody to take action. Please note that this letter was sent by registered A/D and I posses the original receipt.
Lastly I’am extremely sorry to bother you with our troubles but humbly request you Kind Sir to take some time off your busy schedule and suggest me a few legal options to right the wrong being done to me & my 3rd brother.
Thanking You, I remain,
Yours faithfully,
R V SHASTRY DT:13th NOV 2009.

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Arul Kumar (Expert) 13 November 2009
Please inform the above facts to the Registrar of Companies (ROC). The Directors of the Company have violated various provisions of the Companies Act and Income Tax Act.

Raj Kumar Makkad (Expert) 13 November 2009
Definitely directors are continuing various irregularities in the company and Registrar of the Companies as well as Company Law Board can also be contacted to make complaints against such directors.