148 SEBI & Corporate Laws - Reports [Vol. 154
n
In
terms
of
an
approved
scheme
of
arrangement
of
demerger
the
hotel
was
transferred^
to
the
respondent
No. 1- HQRL
which
was
created
as
a
Special
Purpose^
Vehicle
to
enable
disinvestment.
The
paid
up
capital
of
HQRL
was^
Rs.
90
lakhs
comprising
9
lakh
equity
shares
of
Rs. 10
each,
of
which
the^
Government
of
India
held
- 97
per
cent
shares.
IHCL
held
10
per
cent
shares^
and
the
balance
shares
were
held
by
the
employees
of
hotels
of
ITDC
under^
a
Voluntary
Retirement
Scheme.
n
Pursuant
to
its
decision
to
disinvest,
the
Government
invited
bids
for
sale
of^
shares
in
HQRL
The
appellant
No. 3
‘Moral’,
a
public
limited
company,
was^
declared
the
successful
bidder.n
By
a
share
purchase
agreement
dated
8 - 10 - 2002
‘Moral’
acquired
the
shares
of^
Government
of
India
and
IHCL
in
HQRL
for
a
sum
of
Rs.
45
crores.
Out
of^
this,
Rs.
33. 37
crores
was
obtained
by
way
of
loans
from
banks
99. 97
per
cent^
shares
of
HQRL
being
held
by
Moral,
HQRL
became
Moral’s
subsidiary.n
Appellant
No. 1 ,
‘R’,
and
the
appellant
No. 2 ,
‘S’,
who
held
the
controlling
inter
est -
in
Moral,
and
the
respondent
No. 3.
‘A’,
younger
brother
of
the
appellant
No. 1 ,^
were
appointed
as
Additional
Directors
of
HQRL
on
8 - 10 - 2002 ,
and
later,^
regular
Directors
at
the
Annual
General
Meeting
of
HQRL
held
on
28 - 12 - 2002.^n
On
21 - 12 - 2002
a
Board
meeting
of
HQRL
was
held.
Moral
transferred
13
equity^
shares
valued
at
Rs. 10
per
equity
share
of
HQRL
to
7
persons,
2 i.e.^
shares
to
the
appellant
No. 1 ,
‘R’,
3
shares
to
the
appellant
No. 2 ,
‘S’,
one
share^
to
the
respondent
No. 3 ,
‘A’
and
7
shares
to
4
daughters
of
the
appellant
Nos. 1
and
2 ,
‘R’s
family,
thus,
held
99. 97
per
cent
equity
shares,
as
against
one^
equity
share
held
by
his
brother,
‘A’.n
In
AGM,
‘R’
and
‘S’
were
appointed
as
whole
time
directors.
On
19 - 3 - 2003 ,
‘R’,^
chairman
of
HQRL
issued
letter
to
the
respondent
No.
2- Hillcrest
inviting^
subscription
in
- 5
per
cent
cumulative
redeemable
preference
shares^
of
Rs.
100
each
up
to
Rs.
30
crores.
Hillcrest
accepted
and
applied
for^
subscription
requesting
for
allotment
of
23 , 65 , 000 , - 5
per
cent
redeem
able -
preference
shares
in
the
company.
On
5 - 5 - 2003
HQRL
approved
the
issuance^
of
23 , 65 , 000
redeemable
preference
shares
to
Hillcrest.
n
On
27 - 7 - 2004 ,
HQRL
in
compliance
of
resolution
dated
28 - 12 - 2002
passed
under^
section
81 ( 1 A),
issued
23. 90
lakhs
equity
shares
at
par
to
Moral,
the
single^
shareholder
holding
99. 97
per
cent
of
equity.
On
7 - 1 - 2005
HQRL
in
compliance^
of
resolution
dated
28 - 12 - 2002
passed
under
section
81 ( 1 A)
issued^
41. 51
lakh
equity
shares
to
Moral,
1. 10
lakh
equity
shares
to
‘R’
and
4. 5
lakh
equity
shares
to
‘S’.n
On
14 - 1 - 2005
an
Extra
Ordinary
General
Meeting
(EOGM)
was
held
wherein
a^
shareholder’s
resolution
was
adopted
pursuant
to
which
HQRL
increased
its^
authorised
capital
from
existing
Rs.
38
crores
to
Rs.
40
crores,
with
an
increase^
of
2
lakh
equity
shares
of
Rs.
10
each.
On
10 - 5 - 2005
HQRL
allotted