ORDER : T.Ch. Surya Rao, J. This petition is filed under Sections 10, 81, 260, 274, 283, 284, and 286 of the Companies Act, 1956 ('the Act' for brevity) read with Section 151 of the Code of Civil 'Procedure and Rule 9 of Companies (Court) Rules, 1959 for declaring that (i) the appointment of three Additional Directors; (ii) the issuance of share capital of Rs. 1.35 lakhs; and (iii) the removal of the petitioners 1 and 2 from the Directorship; as unlawful and ultra vires of the provisions of the Act and Constitution of India and consequently to set aside the same and for other incidental reliefs. 2. The factual matrix germane for consideration for brevity and better understanding of the matter may be set forth hereunder thus: 3. The first respondent-M/s. Oban Home Needs Limited is a Company initially incorporated on 18-10-1989 as a private Limited Company. The name of the company was changed as M/s. Oban Home Needs Limited on 25-08-1995. The Registered Office of the said company is at Door No. 12-2-823/A/4/1, Gottipati Towers, Mehdipatnam, Hyderabad-500 028. The Company was established to create, run, manage and organise as chain of departmental stores; to act as buyers, sellers, stockists, agents, merchants, distributors, importers, exporters, manufacturers, assemblers, and general dealers of various consumer products; and to act as service agents for providing after sales and other technical services. 4. Both the petitioners 1 and 2 together hold 51.9% of the issued share capital of the Company. The first petitioner is a Mechanical Engineer having more than 25 years of practical experience in food industries, production of marketing of food related products, etc. He conceived the entire scheme and prepared a project report and implemented it and as a result M/s. Oban Home Needs Limited was incorporated. The first petitioner has been the guiding spirit for the continuous success of the said Company. 5. The total number of shareholders of the first respondent-Company constitutes only two groups, namely, the group of the petitioners holding 51.9% and the group of the respondents 2 and 3 holding 48.1% of the total shares. The petitioners 1 and 2 were appointed as Directors from the petitioners' group and the respondents 2 and 3 were appointed as Directors from the other group. The petitioners 1 and 2 were appointed as Directors from the petitioners' group and the respondents 2 and 3 were appointed as Directors from the other group. Out of the four Directors, the second petitioner and third respondent being the housewives, they were not active in the management of the Company. However, they were allowed to draw remuneration from the Company. The first petitioner having been engaged in various other businesses was not able to regularly attend to the management of the first respondent-Company and reposed full confidence in second respondent, who is no other than the husband of the younger sister of the first petitioner. The second respondent has been thus conducting the day-to-day affairs of the first respondent-Company. 6. The second respondent convened a meeting of the Board of Directors on 07-02-2000 without the knowledge of the petitioners 1 and 2 and in the said meeting he got respondents 4 to 6 appointed as Additional Directors deliberately violating the provisions of the Act and thereby made unlawfully his group of Directors a majority in the Board of Directors by passing a necessary resolution. It was purely on extraneous considerations of strengthening the group of the respondents 2 and 3, so that they could have majority in the Board of Directors. 7. The second respondent got shares numbering 13,500 of Rs. 10/each issued to his wife-third respondent in the same unlawful meeting of the Board of Directors. This was only with the deliberate intention to create a majority share holding by the group of the respondents 2 and 3. The issuance of further shares was intended for accusation of control over the affairs of the first respondent-Company. 8. The second respondent convened an extraordinary General Body Meeting without the knowledge of the petitioners on 27-03-2000 and in the said meeting he got the petitioners 1 and 2 removed from the Board of Directors. Thereafter, the petitioners 1 and 2 were not allowed to enter into the Directors' Office. On 30-03-2000 when the petitioners 1 and 2 were not allowed into the Directors' Office and were informed that they were no more Directors, the first petitioner rushed to the Office of the Registrar of Companies and obtained the copies of the relative returns filed by the first respondent-Company and then only he came to know as to what had happened. On the same day, the second respondent took away the Maruti Zen Car registration bearing No.AP HD III6 which was given to the first petitioner on the proportional representation of the share holding and thereupon the second respondent tried to sell away the said Car by issuing an advertisement in Eenadu daily on 02-04-2000. The second respondent also stopped the payment of remuneration and perks to the second petitioner from March, 2000. Therefore, the petitioners' group apprehends that the properties of the Company would be misappropriated by the unlawfully constituted Board of Directors consisting of the respondents 2 to 6. Hence, the present petition. 9. The respondents 1 to 3 resisted the petition by filing a counter together. The respondents 4 to 6 filed a separate counter. 10. The case of the respondents 1 to 3 is that second respondent has been the Whole Time director of the first respondent-Company. He worked dedicatedly for promoting the interests of the first respondent-Company and has been solely responsible for the enviable position in which the first respondent-Company has been placed. The first petitioner although a promoter-Director of the first respondent-Company never evinced any interest except attending the Board meeting as he has been engaged in other activities of companies like Oban Food, etc. In the meeting of the Board of Directors held on 07-02-2000 under the Chairmanship of the second respondent, the respondents 4 to 6 were elected as Directors in order to strengthen and broad base the operations of the first respondent-Company as the second respondent was finding it difficult to operate solely and as the first petitioner expressed his inability to spare any of his time to look after the affairs of the first respondent-Company. In the said meeting, various other issues apart from the election of the respondents 4 to 6 as Directors were also considered and approved. In the Board meeting held on 02-03-2000, the petitioners 1 and 2 intentionally and deliberately absented themselves from the meeting without any communication. In the said meeting, a notice which was got issued by the second respondent under Section 169 of the Act was placed before the Board whereunder the Extraordinary General Body meeting was proposed to be requisioned to transact the business. In the said meeting, a notice which was got issued by the second respondent under Section 169 of the Act was placed before the Board whereunder the Extraordinary General Body meeting was proposed to be requisioned to transact the business. Accordingly, the Extraordinary General Body meeting was held on 27-03-2000 at the Registered Office of the first respondent-Company and the resolution proposing the removal of the petitioners 1 and 2 as Directors was passed unanimously and there was no vote against the said resolution. The petitioners 1 and 2 turned-down the various proposals made by the second respondent for expanding the business and they are solely interested in enriching themselves unjustly at the expense of the first respondent-Company by utilising its resources for their own ends and floated various Companies which have been advancing in their trade lines by leaps and bounds. The attitude and the conduct of the petitioners 1 and 2 were thus highly prejudicial to the interests of the first respondent-Company and, therefore, it was unanimously decided to remove them from the Board of Directors. 11. The petitioners hold only 47.6% of the shares but not 51.9% as claimed. They have Voluntarily opted out from the Directorship of the first respondent-Company by not attending the meetings of the company on 02-03-2000 and 27-03-2000 and, therefore, the respondents 4 to 6 have been properly appointed as Directors of the first respondent-Company. It is their further case that this Court has no jurisdiction. 12. The case of the respondents 4 to 6, besides questioning the jurisdiction of this Court, is that they have been rightly elected as Additional Directors of the Board following the provisions of the Act and that inasmuch as the petitioners 1 and 2 have been misusing their authority as Directors of the first respondent-Company, the shareholders of the company have unanimously passed a resolution in the Extraordinary General Body meeting held on 27-03-2000 removing the petitioners 1 and 2 as Directors of the first respondent-Company with immediate effect. This was intimated to the petitioners and also to the Registrar of Companies by filing the necessary returns. The third respondent is none else than the younger sister of the first petitioner and her application for allotment of shares has been pending with the first respondent-Company since 1998. This was intimated to the petitioners and also to the Registrar of Companies by filing the necessary returns. The third respondent is none else than the younger sister of the first petitioner and her application for allotment of shares has been pending with the first respondent-Company since 1998. The first petitioner and his brother, who is also a shareholder, agreed to allot 13,500 shares to the third respondent and such allotment does not change the share holding pattern. Even after that allotment, the petitioners and brother of the first petitioner still have more than 50% of the total shares and in majority of the shares. They denied all the material averments made in the petition. 13. The petitioners thereafter filed a reply affidavit, denying all the averments made in the counters filed by the respondents. 14. Along with the petition, the petitioners filed certain documents, which are in 14 in number. Later the petitioners also filed three more documents as additional material papers. No evidence either oral or documentary has been adduced on the side of the respondents, arguments have been addressed in favour of the admission of the Company petition and against the same on either side. 15. The Equity Share Certificates annexed to the petition show the number of shares held by the petitioners 1 to 3 in the first respondent-Company. The certified copies of Form No. 2 return of allotments show the number of equity shares allotted to the petitioners. The certified copy of Form No.32 shows the appointment of the petitioners 1 and 2 as Directors and their removal from the Directorship from the first respondent-Company in the extraordinary General Body meeting. The certified copy of another Form No.2 shows the allotment of equity shares to the tune of 13,500 on 07-2-2000 in favour of the third respondent. The xerox copy of the advertisement given in Eenadu classified dated 02-04-2000 shows the advertisement given for the sale of Zen Maruti Car. The documents are marked formally as Exs.A-1 to A-14. 16. A perusal of the above documents, prima facie, shows that the petitioners 1 to 3 are the shareholders of the first respondent-Company; that the petitioners 1 and 2 have been appointed as Directors; and that they have been later removed from the directorship of the first respondent-Company. The documents are marked formally as Exs.A-1 to A-14. 16. A perusal of the above documents, prima facie, shows that the petitioners 1 to 3 are the shareholders of the first respondent-Company; that the petitioners 1 and 2 have been appointed as Directors; and that they have been later removed from the directorship of the first respondent-Company. These documents further show the allotment on 13,500 equity shares in favour of the third respondent as alleged by the petitioners. In fact, there has been no gainsaying of these basic averments made in the petition. 17. Confessedly, the meeting of the Board of Directors was held on 07-02-2000 by the respondents 2 and 3. Evidently, the respondents 4 to 6 were appointed as Additional Directors in the said meeting. While it is the case of the petitioners that the said meeting was held without their knowledge, it is the case of the respondents that the petitioners 1 and 2 have intentionally and deliberately absented themselves from attending the meeting of the Board of Directors despite the notices sent to them to attend the meeting. It Sir the specific case of the petitioners that the petitioners 1 and 2 and the respondents 2 and 3 have been appointed as Directors representing two groups respectively according to the basic structure of the principle of proportional representation and, therefore, the petitioners 1 and 2 cannot be removed from the Office of the directorship. Further more, the petitioners emphasised that as per law it requires a special notice to be given in accordance with the provisions of Section 284(2) of the Act. Apart from the legal requirement, whether a notice of the meeting held on 07-20-2000 in fact was given to the petitioners or not is the moot question. No evidence in this regard has been adduced on the side of the respondents for prima facie consideration of the contentious issue. Admittedly in the meeting held on 07-02-2000 the respondents 4 to 6 were appointed as Additional Directors by passing the necessary resolution. It is the case of the petitioners further that the Additional Directors have been appointed deliberately violating the provisions of the Act so as to make unlawfully the group of the respondents a majority in the Board of Directors of the first respondent-Company. It is the case of the petitioners further that the Additional Directors have been appointed deliberately violating the provisions of the Act so as to make unlawfully the group of the respondents a majority in the Board of Directors of the first respondent-Company. The version of the respondents 1 to 3 is that in order to strengthen and broad base the operations of the first respondent- Company and as the first petitioner expressed his inability to spare any of his time to look after the operations of the first respondent-Company, the respondents 4 to 6 have been appointed as Directors. This circumstance has to be viewed in conjunction with the other contention of the petitioners that the petitioners 1 and 2 have been removed as Directors. 18. The Board meeting was held as per the version of the respondents on 02-03-2000 and in the said meeting it is alleged that despite the notice issued in accordance with the provisions of Section 169 of the Act, the petitioners 1 and 2 absented themselves and that the notice got issued to the petitioners was placed before the Board of Directors in the said meeting where in an Extraordinary General meeting was requisitioned. No evidence in support there of has been forth coming in this case from the side of the respondents. Admittedly, the Extraordinary General meeting was held on 27-03-2000 as resolved in the meeting held on 02-03-2000. In this Extraordinary General Meeting, the petitioners were removed as Directors, which is an admitted fact. The grievance of the petitioners thus is that no notices have been issued to them either about the meeting of the Board of Directors held on 07-02-2000 or 02-03-2000 and about the Extraordinary General meeting held on 27-03-2000. If no such notices have been served upon the petitioners 1 and 2, the resolutions passed on those two occasions -in the meetings of the Board of Directors and the Extraordinary General meeting - will automatically lose every significance. In view of the total lack of evidence on the side of the respondents, except the bare averments made in the counters, it is to be considered prima facie that the petitioners 1 and 2 have not been served with any notices to attend either the Board of Directors^ meeting or the Extraordinary General meeting. 19. In view of the total lack of evidence on the side of the respondents, except the bare averments made in the counters, it is to be considered prima facie that the petitioners 1 and 2 have not been served with any notices to attend either the Board of Directors^ meeting or the Extraordinary General meeting. 19. While it is the case of the petitioners that the petitioners 1 and 2 have been illegally removed from the directorship, it is the case of the respondents that the petitioners 1 and 2 have been validly removed in the extraordinary General meeting, which was unanimous on the point. These issues have to be decided only at the time of regular enquiry. Suffice at this stage to go by a prima facie consideration of the respective cases of the parties and the documents produced in support there of on either side in as much as the matter is only at the threshold for consideration as' to admit the petition or not. 20. As can be seen from the respective pleas taken by the parties, in the first meeting of the Board of Directors on 07-02-2000, the respondents 4 to 6 were appointed as Additional Directors and in the second meeting of Board of Directors on 02-03-2000 an Extraordinary General meeting was called for and on 27-03-2000 when the Extraordinary General meeting was held, the petitioners 1 and 2 were removed as Directors. In the Board meeting held on 07-02-2000 itself additional shares to the time of 13,500 were allotted in favour of the third respondent. This aspect has to be considered in the light of the case of the petitioners that the petitioners' group hold 51.9% shares while the respondents' group held by then the remaining 48.1% of total shares and so as to make them majority shareholders, shares to the tune of 13,500 have been allotted in favour of the third respondent surreptitiously. Prima facie, it appears to be a circumstance to be reckoned, although these aspects shall have to be decided only in a fullfledged enquiry with reference to the evidence and the surrounding circumstances. 21. Evidently, an advertisement was given in Eenadu classifieds for the sale of Maruti Zen Car. Prima facie, it appears to be a circumstance to be reckoned, although these aspects shall have to be decided only in a fullfledged enquiry with reference to the evidence and the surrounding circumstances. 21. Evidently, an advertisement was given in Eenadu classifieds for the sale of Maruti Zen Car. The case of the petitioners is that the petitioners 1 and 2 were not allowed to enter in to the Directors' Office on 30-03-2000 while informing them that they were no more Directors and that the Maruti Zen Car bearing No.AP IID III6 which was given to the first petitioner was taken away and the same was advertised for sale by issuing a paper publication on 02-04-2000. Finally, it is the apprehension of the petitioners that the funds and properties of the first respondent-Company would be misappropriated by the unlawfully constituted Board of directors. 22. The respondents have seriously disputed the jurisdiction of this Court and in fact that seems to be the main contention and perhaps the reason for not adducing any evidence in support of their various averments made in the counters. 23. Sri E. Manohar, learned senior Counsel appearing for the respondents 1 to 3, contends that the acts complained of by the petitioners would amount to an act of oppression and, therefore, the petitioners must file a petition before the Company Law Board under Section 397 of the Act. 24. The learned Counsel appearing for the petitioners seeks to justify the stand of the petitioners for entertaining the petition before this Court on the other hand. 25. The reliefs sought for in this petition are no doubt for declaration of the meetings held on various dates as enumerated above, without issuing the necessary notices as illegal and ultra vires of the provisions of the Act and for setting aside the same. In view of the said contentions, it is expedient to refer the relevant provisions under the Act for brevity and better understanding of the matter. Section 10 of the Act is the relevant provision, which deals with the jurisdiction of the High Court and the jurisdiction of the Civil Court. Sections 397 and 398 of the Act are the other Sections, which envisage specific situations where the parties can approach the Company Law Board. Section 10 of the Act reads as under. Section 10 of the Act is the relevant provision, which deals with the jurisdiction of the High Court and the jurisdiction of the Civil Court. Sections 397 and 398 of the Act are the other Sections, which envisage specific situations where the parties can approach the Company Law Board. Section 10 of the Act reads as under. "S.10.Jurisdiction of Courts.-(l) The Court having jurisdiction under this Act shall be- (a) the High Court having jurisdiction in relation to the place at which the registered office of the company concerned is situate, except to the extent to which jurisdiction has been conferred on any District Court or District Courts Subordinate to that High Court in pursuance of sub-section (2); and (b) where jurisdiction has been so conferred, the District Court in regard to matters falling within the scope of the jurisdiction conferred, in respect of companies having their registered offices in the district. (2) the Central Government may, by notification in the Official Gazette and subject to such restrictions, limitations and conditions as it thinks fit empower any District Court to exercise all or any of the jurisdiction conferred by this Act upon the Court, not being the jurisdiction conferred- (a) in respect of companies generally, by Sections 237, 391, 394, 395 and 397 to 407, both inclusive; (b) in respect of companies with a paid-up share capital of not less than one lakh of rupees by Part VII (Sections 425 to 560) and the other provisions of this Act relating to the winding-up of companies. (3) for the purposes of jurisdiction to wind-up companies, the expression "registered office" means the place which; has longest been the registered office of the company during the six months immediately preceding the presentation of the petitions for winding-up." Sections 397 and 398 of the Act read as under: "S.397. Application to Company Law Board for relief in cases of oppression.- (1) Any member of a company who complain that the affairs of the .company are being conducted in a manner prejudicial to public interest or in a manner oppressive to any member or members including any one or more of themselves may apply to the Company Law Board for an order under this section, provided such members have a right so apply in virtue of Section 399. (2) If, on any application under subsection (1), the Company Law Board is of opinion- (a) that the company's affairs are being conducted in a manner prejudicial to public interest or in a manner oppressive to any member or members; and (b) that to wind-up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the making of a winding-up order on the ground that it was just and equitable that the company should be wound-up; the Company Law Board may, with a view to bringing to an end the matters complained of, make such order as it thinks fit." '5,398, Application to company Law Board for relief in gases oi mismanagement- (1) any members of company who complain (a) that the affairs of the company are being conducted in a manner prejudicial to public interests or in a manner prejudicial to. the interests of the company; or (b) that a material change not being a change brought about by or in the interests of, any creditors including debenture-holders, or any class of shareholders, of the company has taken place in the management or control of the company whether by an alteration in its Board of Directors, or Manager or in the ownership of the company's shares, or if it has no share-capital, in its membership, or in any other manner whatsoever, and that by reason of such change, it is likely that the affairs of the company will be conducted in a manner prejudicial to public interest or in a manner prejudicial to the interests of the company, may apply to the Company Law Board for an order under this section, provided such members have a right so to apply in virtue of Section 399. (2) If, on any application under subsection (1), the Company Law Board is of opinion that the affairs of the company are being conducted as aforesaid or that by reason of any material change as aforesaid in the management or control of the company it is likely that the affairs of the company will be conducted as aforesaid, the Company Law Board may, with a view to bringing to an end or preventing the matters complained of or apprehended, make such order as it thinks fit". 26. 26. Earlier, the jurisdiction was with the Company Court in respect of the petitions envisaged under Sections 397 to 403 of the Act. Later under an Amendment Act, 1988 which came into effect on 31-05-1991 in respect of the matters covered by Sections 397 to 403 of the Act, the jurisdiction was conferred on Company Law Board by substituting the same in the place of the Company Court. Therefore, with effect from 31-05-1991 in respect of the matters covered by Sections 397 to 403 of the Act, it is the Company Law Board, which has jurisdiction but not the company Court. The position is thus obvious. As can be seen from the provisions extracted above, Section 397 envisages an application to be filed before the Company Law Board seeking the necessary relief in cases of oppression and Section 398 envisages an application in the case of mismanagement. 27. Guardedly, the averments have been so made in the petition by the petitioners leaving no scope to discern the expressions of 'oppression' or 'mismanagement'. It is, therefore, the contention of the learned Counsel appearing for the petitioners that it is not a case of oppression or mismanagement and, therefore, the petition can be maintained before the Company Court. Although, there has been no specific pleading in the entire affidavit making the allegation of oppression or mismanagement whether the acts alleged specifically in the petition would constitute oppression or mismanagement or not, can be seen. There have been cases where by camouflage or trick in the pleading the parties try to clutch at the jurisdiction of a wrong forum to suit their personal conveniences. Therefore, even in the absence of any specific averment in the pleading, still it is open to see whether the acts alleged in the petition constitute oppression or mismanagement and come squarely within the ambit of Sections 397 and 398 of the Act so as to eventually determine the jurisdictional aspect. 28. Lengthy arguments have been addressed placing reliance upon plurality of authorities on either side. It is not necessary to burden this order by referring to all those judgments. One judgment, which is apt quoting at this juncture is the Judgment of the Apex Court in Needle Industries (India) Ltd. and others v. Needle Industries Newey (India) Holdings Ltd. and others, AIR 1981 SC 1298 . It is not necessary to burden this order by referring to all those judgments. One judgment, which is apt quoting at this juncture is the Judgment of the Apex Court in Needle Industries (India) Ltd. and others v. Needle Industries Newey (India) Holdings Ltd. and others, AIR 1981 SC 1298 . The Apex Court reviewing the judgments rendered by the Courts at England under Section 210 of the English Companies Act, a provision which is akin to Section 397 of the Act, had succinctly held thus: "In an application under Section 397 before granting relief the Court has to satisfy itself that to wind-up the company will unfairly prejudice the members complaining of oppression, but that otherwise the facts will justify the making of a winding-up order on the ground that it is just and equitable that the company should be wound up. An isolated act, which is contrary to law, may not necessarily and by itself support the inference that the law was violated with a mala fide intention or that such violation was burdensome, harsh and wrongful. But a series of illegal acts following upon one another can, in the context, lead justifiably to the conclusion that they are a part of the same transaction, of which the object is to cause or commit the oppression of persons against whom those acts are directed. On a true construction of Section 397, an unwise, inefficient or careless conduct of a director in the performance of his duties cannot give rise to a claim for relief under that Section. The person complaining of oppression must show that he has been constrained to submit to a conduct which lacks in probity, conduct which is unfair to him and which causes prejudice to him in the exercise of his legal and proprietary rights as shareholder." 29. That was case where in the Company Petition, it was alleged that the Indian Directors of the NI1L abused their fiduciary position in the Company by deciding in the meeting of April 6, 1977 to issue the rights shares at par and allotting them exclusively to the Indian shareholders in the meeting of May 2, 1977 and in so doing, they acted mala fide and in order to gain an illegal advantage for themselves. It was further alleged that by deciding to issue the rights shares at par they conferred a tremendous and illegitimate advantage on the Indian shareholders. Thus, the conduct of the Indian directors lacked in probity and fair dealing which the NINIH was entitled to expect. Therefore, it was prayed that the proceedings of the Meeting of the Board of Directors held on April 6 and May 2, 1977 be declared illegal, void and inoperative; that purported allotment of 16,000 shares pursuant to the impugned resolution of Board of May 2, 1977 be declared void; among various other reliefs. A Single Judge of the High Court who tried the Company Petition held, having found several defects and infirmities in the Board's Meeting dated May 2, 1977 that appropriate relief should be granted to the respondent-Company under Section 398 of the Companies Act. The learned Single Judge was of the view that the average market value of the rights shares was about Rs. 190/- per share on the crucial date and that since the rights shares were issued at par the respondent-Company was deprived unjustly of a sum of Rs. 8,54,550/- at the rate of Rs. 90/- per share on the 9,495 rights shares to which it was entitled to. In the O.S. Appeal filed against the said judgment of the learned Single Judge, the Division Bench held that the affairs of NHL were being conducted in a manner oppressive, that is to say, burdensome, harsh and wrongful to the respondent-Company and since the action of the Board of Directors of NIIL was not in the interest of the Company, it was just and equitable to wind-up the Company. Thus holding, the Division Bench granted the relief of declaration to set aside the resolution passed in the Board meetings on the two occasions. The matter went up to the Supreme Court. The question arose before the apex Court was whether the decisions taken in the Meetings of the Board of Directors of MIL on April 6, and May 2, 1977 constitute acts of oppression within the meaning of Section 397 of the Companies Act. The matter went up to the Supreme Court. The question arose before the apex Court was whether the decisions taken in the Meetings of the Board of Directors of MIL on April 6, and May 2, 1977 constitute acts of oppression within the meaning of Section 397 of the Companies Act. While the High Court answered that question in the affirmative, the Apex Court after having reviewed the case law on the point, held that an isolated act, which is contrary to law, may not necessarily and by itself support the inference that a law was violated with a mala fide intention or that such violation was burdensome, harsh and wrongful. The Supreme Court was of the view that the issue of rights shares was made for the purpose of complying with the requirements of FERA and the directives issued by the Reserve Bank of India under that Act. Although there have been violations of certain of the provisions of the Companies Act, in view of the requirements of FERA and the directives of the Reserve Bank of India that a single isolated act of violation of the Rules in having issued the rights shares could not be held to be legitimately an act of oppression. At the same time, the Supreme Court was so specific that in the course of same transaction a series of illegal acts following upon one another can, in the context, lead justifiably to the conclusion that they are a part of the same transaction, of which the object is to cause or commit the oppression of persons against whom those acts are directed. 30. Very recently in Hanuman Prasad Bagri and Others v. Bagress Cereals Pvt. Limited and others, 2001 AIR SCW 1359 the Apex Court placing reliance upon its earlier judgment in Needle Industries Private Limited case (1 supra), held that if the facts fall short of a case upon which the Company Court feels that the company should be wound-up on just and equitable grounds, in that event no relief can be granted to the petitioner in regard to Section 397 of the Act. The Apex Court further held that the proof that winding-up would unfairly prejudice the applicants and otherwise the facts justify winding-up on equitable grounds is a condition precedent, so as to maintain the action on the ground of oppression and miss-management under Sections 397 and 398 of the Companies Act. 31. That was a case where on the ground, that the registered office of the company was shifted from one premise to another premises and again shifted back from there; certain amount of wheat quota was allowed contrary to the control orders to be shifted by a sister concern; that a loan payable to the petitioner No.1 sought to be paid back by showing book adjustments as a payment to another company in extinguishing of the liability of the petitioner No.1 on the oral instructions of petitioner No.1 certain Roller Boxes were sold off, although they were still usable and unnecessarily sold; that certain amount of commission was paid to Mitsubishi company to respondent No.3 so as to avoid tax incidence and respondent No.3 utilised the losses of the company for setting of the profit, and continuing the Directorship of the petitioner No.1 was sought to be terminated without giving him appropriate notices of the Board meetings and stoppage of remuneration and of directorial benefits, is improper and illegal. 32. Alleging these grounds a Company Petition under Sections 397 and 398 of the Companies Act was filed on the ground of oppression and mismanagement. A single Judge of the High Court allowed that petition. However, a Division Bench of the High Court allowed the appeal filed assailing the judgment of the Single Judge. The Division Bench was not impressed with the merits of the case nor with the legal position and was of the view that the Company Petition was liable to be rejected on the ground that there was no finding by the learned Single Judge that the winding-up will definitely prejudice the company and finally concluded that it was impossible to arrive at such a finding in favour of the petitioners. 33. 33. The Division Bench went on discussing all the six points holding that shifting of the premises it did not suffer much loss and the same is not a ground to be raised in a petition under Sections 397 and 398, as no case of oppression was made out and that allowing the wheat quota contrary to the control orders does not disclose any oppression or mismanagement inasmuch as company during that period was under lockout and therefore it allowed its sister concern to lift the quota, since there was no loss suffered by the company and that as regards the extinguishments of the liability of the petitioner inasmuch as the petitioner No.1 filed a separate Company Petition for winding-up against another sister concern, however, the suit was ordered to be filed for recovery of that amount and the amount was directed to be deposited pursuant to a decree and therefore it was held that if a debt remained owing to petitioner No.1 from the company it would be unreasonable for petitioner No.1 to ask for a just and equitable winding-up of the company and on the other hand filing a suit would be proper as it has been done in the other case, and that as regards the sale of the Roller boxes, though they are usable it was found that it was not an act of oppression or mismanagement, and that the commission of Rs. 23 lakhs given by Mitsubishi Company could hardly be a matter of mismanagement of a company, since no loss was shown to have accrued to the company because of a the bringing in of this commission and on the last point that as the petitioners did not attend the Board meetings, he was treated to have been ceased to be a Director in terms of Section 283(1) (g) of the Act. Although that was seriously disputed by the petitioner, the Bench concluded that the termination of Directorship would not entitle such person to ask for winding-up on just and equitable grounds. In other words, the Division Bench was of the view that no case of oppression or mismanagement was made out and for the single and isolated act of illegally removing from the Directorship when the company was doing good business was not certainly a ground for winding up on just and equitable ground. In other words, the Division Bench was of the view that no case of oppression or mismanagement was made out and for the single and isolated act of illegally removing from the Directorship when the company was doing good business was not certainly a ground for winding up on just and equitable ground. Under such circumstances, since the condition that the winding-up of the company would unfairly prejudice the applicants and otherwise the facts justify winding-up on equitable grounds, which is a sine quanon was not satisfied in the case. The facts in the case are entirely different from the facts in the instant case. That apart that was again a case where the petitioner was holding 20% of the shares while the opposing party was holding more than 80% and they have sufficient majority share holding even to pass a special resolution. 34. The contention of the learned Counsel for the petitioners is that the petitioners cannot invoke Sections 397 and 398 of the Act in view of the bar engrafted under Section 399 of the Act. 35. According to Section 399 of the Act a company having a sharecapital having not less than 100 members of the company or not less than one tenth of the total number of its members which ever is less or any member or members holding not less than one tenth of the issued share-capital are entitled to apply under Section 397 nor 398 of the Act. Similarly in the case of a company having share capital not less than one fifth of the total number of members shall have the right to apply. Therefore, the right to apply under Section 397 or 398 of the Companies Act alleging oppression or mismanagement is circumscribed by certain limitations enjoined under clauses (a) and (b) of Section 399 of the Act. Hence the petitioners cannot apply under Section 397 or 398 of the Companies Act as the case may be. The said contention merits no consideration in as much as the petitioners are holding more than one tenth of the issued sharecapital of the company. Even otherwise they can seek permission of the Central Government under sub-section (4) of Section 399 of the Companies Act and after obtaining such permission can apply under Section 397 or 398 of the Companies Act. Even otherwise they can seek permission of the Central Government under sub-section (4) of Section 399 of the Companies Act and after obtaining such permission can apply under Section 397 or 398 of the Companies Act. Therefore, Section 399 of the Act is no bar for the petitioners, if so advised to apply under Section 397 or 398 of the Act as the case may be before the Company Law Board. 36. Sri E. Manohar, learned senior Counsel appearing for the respondents 1 to 3, seeks to place reliance upon various judgments rendered by the Company Law Board, which construed the expressions 'oppression' and 'mismanagement'. An appeal lies over the Order of the Company Law Board to the High Court in view of Section 10-F of the Act. It is not known as to whether those judgments attained finality or not. As discussed by me supra, there is no need to burden this order with plurality of the judgments rendered by various Courts in the country. 37. Suffice at this stage to look at the provision germane for consideration in the context i.e. Section 397 of the Act. The twin requirements to attract the provisions of Section 397 are that the affairs of the Company are being conducted in a manner which is prejudicial to the public interest or in a manner oppressive to any member or members of the Company and the affairs are such that it would be just and equitable to wind-up the Company but for the fact that it would unfairly prejudice such members. In fact, the Apex Court in Shanti Prasad Jain v. Kalinga Tubes Ltd., (1965) 35 Company Cases 351 held as under: "In a petition under Section 397 of the Companies Act, 1956, it is not enough to show that there is just and equitable cause for winding-up the company, though that must be shown as preliminary to the application of Section 397. It must further be shown that the conduct of the majority shareholders was oppressive to the minority as members and this requires that events have to be considered not in isolation but as a part of consecutive story. There must be continuous acts on the part of the majority shareholders, continuing up to the date of the petition, showing that the affairs of the company were being conducted in a manner oppressive to some part of the members. There must be continuous acts on the part of the majority shareholders, continuing up to the date of the petition, showing that the affairs of the company were being conducted in a manner oppressive to some part of the members. The conduct must be burdensome, harsh and wrongful and mere lack of confidence between the majority shareholders and the minority shareholders would not be enough unless the lack of confidence springs from oppression of a minority by a majority in the management of a company's affairs and such oppression must involve at least an element of lack of probity or fair dealing to a member in the matter of his proprietary rights as a shareholder." 38. Turning to the facts in the instant case, the grievance of the petitioners seems to be that a meeting was held on 07-02-2000 without notice where respondents 4 to 6 were appointed as Additional Directors and in the same meeting additional share were allotted to the third respondent to the tune of 13,500. All this was done to see that the respondents' group becomes major shareholders and they enjoy the majority in the Board of Directors and meeting was held on 02-03-2000 without issuing notice to the petitioners 1 and 2 wherein a requisition to call for the Extraordinary General meeting was given and accepted and an Extraordinary General meeting was held on 27-03-2000 where in the petitioners 1 and 2 were removed as Directors. Certainly, it was not a case of isolated act. Added to it, it is the further grievance of the petitioners that the car allotted to the first petitioner was taken away and sought to be sold away by giving necessary advertisement. Further more, the petitioners 1 and 2 were not allowed to enter into the Office of the Board of Directors. Above all, it is further allegation of the petitioners that they apprehend misappropriation of funds and properties of the first respondent-Company at the hands of the unlawfully constituted Board of Directors. 39. These allegations, if proved, would certainly constitute the act of oppression. Obviously, the petitioners group were the major shareholders having 51.9% of total shares qua the group of respondents having 48.1% of the total shares. Admittedly, the petitioners 1 and 2 and the respondents 2 and 3 are the Directors constituting the Board drawing two Directors from each of the groups. Obviously, the petitioners group were the major shareholders having 51.9% of total shares qua the group of respondents having 48.1% of the total shares. Admittedly, the petitioners 1 and 2 and the respondents 2 and 3 are the Directors constituting the Board drawing two Directors from each of the groups. By addition of respondents 4 to 6 as the Directors, certainly the group of respondents would now enjoy the majority in the Board of Directors which was not the situation earlier prior to the appointment of the Additional Directors. Prima facie, therefore, it can be seen in the wake of the allegations made by the petitioners that no notices were given to them to attend the Board meetings and that these things have been done purposefully. The result is obvious that the minority has become the majority in the shares and the respondents' group enjoy now majority in the Board of Directors. Following up the above acts, now the allegation of the petitioners is that Maruti Zen Car has been taken away; remuneration being given to the second petitioner is stopped; and the petitioners 1 and 2 have been prevented from entering into the Office of the Board of Directors. Therefore, the acts alleged, in my considered view, definitely constitute the act of oppression. The allegation of misappropriation of the funds and properties of the first respondent-Company would fall definitely in the realm of mismanagement as envisaged by Section 398 of the Act. The above conclusions, in view of the peculiar facts and circumstances of this case, are inescapable. For the foregoing reasons, I am of the considered view that the petitioners are now questioning the acts of oppression and mismanagement of the respondents in this petition. 40. Well, when the affairs of the Company are alleged to have been conducted in the manner oppressive to the petitioners and in the wake of the allegation of misappropriation of funds and properties of the first respondent-Company, whether it would justify in making a winding-up order on the ground that it is just and equitable or not is the moot question. When it is said that the appointment of the respondents 4 to 6 as Additional Directors is illegal; that the petitioners 1 and 2 were made minority by allotting the additional shares to the third respondent here in; and when it is said that the petitioners 1 and 2 were removed from the Directorship; and when it is said that the remuneration being paid to the second petitioner was stopped and the Maruti Zen Car allotted to the first petitioner was taken away; and when it is said that the petitioners 1 and 2 were prevented from entering in to the Office of the Board of Directors, these allegations, in my considered view, are sufficient enough for the petitioners to opt for winding-up of the first respondent-Company on the grounds of just and equity. There has been no allegation of the first respondent-Company being run on loss. But, winding-up of the first respondent-Company might ultimately result in unfair prejudice to the interests of the petitioners. The grievance of the petitioners can be effectively redressed if the reliefs of declaration as prayed for are granted. Therefore, the condition precedent under sub-section (2) of Section 397 of the Act is also satisfied in this case. Under such circumstances, in my considered view, the petitioners' grievance squarely falls under Section 397 of the Act. 41. Now, in view of the amended provisions of the Act, an application lies to the Company Law Board under Sections 397 and 398 of the Act vesting the jurisdiction on the Company Law Board by taking it away from the Company Court, namely, the High Court concerned. An appeal also is provided under Section 10-F of the Act against the order of the Company Law Board to the Company Court. Therefore it is for the petitioners to approach the Company Law Board and they cannot now clutch at the jurisdiction of the Company Court by drafting the pleadings so guardedly trying in to avoid the express articulation of the expression "acts of oppression" and "mismanagement" in the petition. 42. In the result, the Company Petition is dismissed, but in the circumstance no order as to costs.