In Brief
The Supreme Court upheld the High Court's decision setting aside share allotments and transfers made by Hotel Queen Road Pvt. Ltd. (HQRL) in 2004–2005. The Court found that three Board meetings violated mandatory provisions of the Companies Act: Section 286 (no notice given to Director Ashok Mittal), Section 300 (interested directors R.P. Mittal and Mrs. Sarla Mittal improperly participated), and Section 108 (share certificates not produced for transfer). These violations, constituting a series of illegal acts, amounted to oppression under Section 397. The Court rejected the argument that interim findings on HQRL's status as a public company (which determine voting rights) were binding precedents, noting such findings were prima facie only. The interests of preference shareholder Hillcrest and Ashok Mittal, who had substantially invested in the company, were protected. The direction to prosecute Appellant Ram Prakash Mittal was set aside.
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