Dr. Jawahar Palaniappan, a cardiologist and Director, Knox Community Hospital, USA , son of Kumudam Publications founder SAP. Annamalai Chettiar, has won a major legal battle with the National Company Law Tribunal (NCLT)
Upon demise of Shri S.A.P.Annamalai in 1994 Dr.A.Jawahar Palaniappan inherited the shares held by his father. Smt.A.Kothai was made the Managing Director
Shri P.V.Parthasarathy and his family handled the day to day affairs of the Company. Also 33.39% shares were given to Mr.P.V.Parthasarathy’s family through a company named M/s.Imprint Tech(India) Private Limited.
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Presently P.Varadarajan and P.Srinivasan (brother of Varadarajan) are Directors of this company M/s.Imprint Tech Pvt. Ltd.
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M/s.Kumudam Publications Private Limited was founded as HUF in 1947 by Annamalai and his wife .Kothai. Shri Annamalai was the Kartha and was controlling the business. The promoters converted HUF to Private Limited Company in 1971. The First share holders were .Annamalai (MD) and his wife .Kothai (Director) holding all the 100% equity. By virtue of the Articles of Association(AOA) founder directors were permanent and Kothai (mother of Dr.A.Jawahar Palaniappan) has since been in the board – Archive Pic Source ICBN
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Thus, the shareholding pattern of Kumudam became 64.73% to Dr.Jawahar , 1.88% to Mrs.Kothai and 33.39% to M/s.Imprint Tech India Private Limited
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Present Kumudam Publications Director Varadarajan usurped in the company founded by Father of Dr.Jawhar resulted in litigation .
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Then Dr. Jawahar and his mother Kothai ( ref as Aachi ) knocked with different legal agencies and conducted a long standing battle thanks to the contacts Varadarajan and his family men has with power centres
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It is only after lengthy trial NCLT declared forms filed by Mr. Varadarajan as illegal with the Registrar of Companies intimating the cessation of Mr. Palaniappan and his mother A. Kothai as directors of the company from January 2, 2012.
NCLT also declared as illegal, invalid and non est in law the arbitrary cancellation of 3,32,640 equity shares held by Dr. Jawahar in Kumudam Publications Pvt. Ltd. (KPPL).
Such action “is considered as oppressive to the interest of the majority shareholders and to the company itself,” the NCLT declared .
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With his hard work and down to earth management policy and innovative style of reporting Annamalai has built Tamil language weekly Kumudam as the leading weekly in India with circulation grossed peak during his period
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To restore normalcy, NCLT permitted the mother-son duo to appoint two more directors in proportion to their shareholding in the company and appointed K.K. Balu, former vice-chairman of the Company Law Board, as the chairman of KPPL for a period of six months to conduct the affairs of the company.
Accepting a plea made by Dr. Jawahar Palaniappan, the NCLT also ordered deletion of three amendments made to the articles of association after Ms. Kothai resigned as MD due to old age in July 2002 and Mr. Varadarajan, son of former company secretary P.V. Parthasarathy, succeeded her.
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The amendments stated that Imprint Tech India Pvt. Ltd., belonging to Mr. Varadarajan and his family members, would be entitled to nominate two directors to KPPL’s board and that they shall not be liable to retire by rotation.
They also stated if one of those nominees happened to be Mr. Varadarajan, he would occupy the post of chairman.
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Further, the amendments went on to give Mr. Varadarajan the privilege of also being the MD of KPPL as long as he was one of the directors and that he shall be entitled to receive remuneration up to 11% of the net profit of the company apart from the monthly remuneration fixed by the board for serving as the MD.
Though it was argued the amendments were made with the full knowledge of Mr. Palaniappan and his mother, the tribunal said, it was done because of mutual trust and confidence.
However, the differences of opinion began to surface only in December 2008 when Mr. Varadarajan’s remuneration showed an increase of 88% though the company had suffered losses.
Since then, Mr. Palaniappan and his mother voted against approving the accounts. Consequently, they could not participate in the affairs of the company in an effective manner, despite being majority shareholders (over 66%), since the extraordinary general meetings and annual general meetings of the company were not conducted from 2010, the NCLT said.
To restore normalcy, NCLT permitted the mother-son duo to appoint two more directors in proportion to their shareholding in the company and appointed K.K. Balu, former vice-chairman of the Company Law Board, as the chairman of KPPL for a period of six months to conduct the affairs of the company.
Also to read the intensity of fraud committed by Varadarajan and his family Source thanks Indiankanoon : Dr.A.Jawahar Palanippan vs The State on 15 March, 2019
