JUDGMENT
S.J. Mukhopadhaya, J.
1. The plaintiffs are the appellants, who have preferred this appeal against order dated August 24, 1999, passed by the learned judge in O.A. No. 470 of 1998 in C.S. No. 590 of 1998. By the said order, the learned judge, while did not choose to pass any order of interim injunction restraining the second respondent/defendant from holding out as managing director of the first respondent/defendant-company–Coromandel Indag Products India Ltd., directed the second defendant to convene a general body meeting of the first defendant-company and to elect board of directors in accordance with articles of association.
2. As the case could be disposed of on a short point, it is not necessary to detail all the facts, except the relevant ones, as mentioned hereunder:
The first defendant-company–Coromandel Indag Products India Ltd., is a company incorporated under the Companies Act, 1956. According to the plaintiffs, they are the shareholders. A suit was preferred for declaration that the appointment and continuation of the second respondent, Arun R. Fredrick, as managing director or director of the first defendant-company is illegal, null and void and for permanent injunction restraining the second defendant from holding himself out or interfering with the affairs of the first respondent-company as managing director/director or in any other capacity and other reliefs.
In the said suit, as mentioned above, application was filed by the plaintiff praying for interim injunction restraining the second defendant from holding out as managing director of the first respondent-company and also from interfering with the affairs of the said company. No order was passed to the extent of prayer made, but the second defendant was asked to convene a general body meeting.
3. Learned Counsel appearing on behalf of the appellants referred to the impugned order dated August 24, 1999, and submitted that learned judge having accepted that the induction of the second defendant, who has not been co-opted, as director/managing director of the company, being illegal, should have passed order of interim injunction restraining the said second defendant from holding out as managing director of the first defendant-company and from interfering with the affairs of the said company. In spite of such decision, as no such direction has been issued, it requires interference with the impugned order. It was contended that the learned judge having given repeated finding that the appointment of the second defendant as managing director of the first defendant-company had no legal basis and that he was not even a director, ought to have granted interim injunction against the second defendant as prayed for.
4. Further, according to counsel for the appellant, learned judge has grievously erred in directing the second defendant to convene the general body meeting of the first defendant-company as express finding has been given that the second defendant is not the managing director, much less a director and, thereby, he cannot call for general body meeting of the first defendant-company. It can be called only in accordance with the provisions of the Companies Act and such direction being contrary to the aforesaid law, should be interfered with in this appeal.
5. Counsel appearing on behalf of the respondents/defendants submitted 5 that one of the plaintiff is now supporting the second defendant. On the merits, in regard to induction of the second defendant as managing director, practically no argument was advanced.
6. We have heard the parties and perused the order passed by learned 6 judge. It will be evident that learned judge, while found that there was a prima facie case made out by plaintiff, taking into consideration the balance of convenience, refused to pass order of interim injunction as was sought for. It was noticed and as accepted during argument that plaintiffs and defendants are blood relations. Father and one of the sons were on one side as plaintiffs. On the other hand, mother, daughters and the other son are the defendants. Father and elder son were opposing induction of the second defendant, who is the second son/younger brother of the plaintiff. The mother and daughters/sisters were supporting the other son/brother, i.e., the second defendant. It is informed that one of the plaintiff, i.e., father, has now again taken side of the second defendant. Taking into consideration that the second defendant was inducted as managing director by way of family arrangement arrived at that point of time in November, 1995, and that the plaintiffs had no objection till 1997, i.e., prior to the conflict with the interest of the first defendant as alleged, learned judge refused to pass order of interim injunction as sought for by the plaintiffs.
7. So far as convening of general body meeting is concerned, we are of the view that no such direction should have been issued by learned judge as no such prayer was made by either of the parties. If the second defendant, prima facie, found to be not the managing director or director of the company, he even cannot convene the general body meeting of the first defendant-company. There is a procedure under the Companies Act, 1956, as per which any shareholder, having more than the requisite shares (10 per cent.) can call for a general body meeting. If such direction was required to be given, in that case, the plaintiffs or any other defendants, who is a shareholder, should have been asked to take steps in accordance with law for convening a general body meeting of the first defendant-company.
8. In view of our finding aforesaid and taking into consideration that the company is functioning without interim order ever since filing of the suit, we are not inclined to grant an order of interim injunction as was sought for by the plaintiffs. But as the general body meeting can be convened only in accordance with the provisions of the Companies Act at the instance of one of the shareholders, we set aside the last portion, paragraph 18 of the impugned order dated August 24, 1999, with liberty to eligible shareholders of the first defendant-company to take such steps so that the general body meeting of the first defendant-company in which the general body may take appropriate decision with regard to election of managing director of the company.
The appeal is allowed in part and stands disposed of with the aforesaid observations. Consequently, connected miscellaneous petitions are closed. But there shall be no order as to costs.