Dismissed

Lycamobile Uk Ltd. v. Plintron Mobility Solutions Pvt. Ltd.

Madras HC27 Jan 2020CS/372/2019

Case brief

AI extract

What is this about?

Plaintiff company filed a suit for permanent injunction against defendants regarding shareholding and service interference. Parties settled post-filing, converting shares. Court dismissed the suit as withdrawn and ordered refund of court fee.

What did the court decide?

Civil suit dismissed as withdrawn. Plaintiff entitled to refund of court fee as per law. Connected applications closed.

Lycamobile Uk Ltd. Vs Plintron Mobility Solutions Pvt… — Company and Corporate | Madras HC (2020)

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C.S.No.372 of 2019

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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Dated:27.01.2020

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Coram:

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THE HONOURABLE DR. JUSTICE G. JAYACHANDRAN

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C.S(Comm.Div.) No.372 of 2019

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Lycamobile UK Ltd. Represented by its Director, Premananthan Sivasamy Company No.05903820 Having its registered office at 195, Marsh Wall, London E149SG

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.. Plaintiff

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/versus/

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1.Plintron Mobility Solutions Private Limited, Represented by its Chairman, Mohan Kumar Sundaram Having its registered office at Block 6, GKS Technology Pari Level 3& 4, DLF SEZ IT Park, Shivaji Gardens, Ramapuram, Chennai 600 089.

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2.Mohan Kumar Sundaram B-8-3, Navin's Dayton Heights, 76, Nelson Manickam Road, Aminjikarai, Chennai 600 029.

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3.Ms.Subhashree Radhakrishnan B-7-3, Navin's Dayton Heights, 76, Nelson Manickam Road, Aminjikarai, Chennai 600 029.

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http://www.judis.nic.in

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C.S.No.372 of 2019

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4.Pettigo Commercio International Lda Represented by its Director, Having its registered address at Rua das Hortas, N1 Edificio do Carmo, 5 Andar, Sala 5000, 9050-024 Funchal, Madeira, Portugal.

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Civil Suit filed under Order VII, Rule 1 of the Code of Civil Procedure, 1908 read with Order IV, Rule 1 of the Original Side Rules and Section 7 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Court Act, 2015 (Act No.4 of 2016) praying to pass a judgment and decree in favour of the plaintiff: (a)for permanent injunction restraining the defendants 1 to 3, their men, agents, servants, employees or any person acting thereunder from in any manner interfering with the services being provided to the plaintiff and (b) costs of the above proceedings.

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J U D G M E N T

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The case of the plaintiff is that the plaintiff company is part

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of a larger group of Lycamobiles set up in the year 2006. It is one of

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http://www.judis.nic.in

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C.S.No.372 of 2019

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the known telecommunications Provider. The plaintiff company is to undertake all main telecommunications services and the partner will provide a brand and retail distribution services to effectively sell the end product to private individual consumers. LycaTech was a company incorporated in India to provide support services to the plaintiff company. At that time, Defendants 2 and 3 were engaged as emplyees of LycaTech. With the fund by the Lyca Group in the year 2008 Lyca Technology Solutions Private Limited was incorporated with an object to carry on business in software solutions. This company used the information developed by LycaTech in the development of its IT services. At the time of incorporation of the company, defendants 2 and 3 were granted 8% sweat/loyalty equity and the 4th defendant held the remaining 92% of the shareholding. Over the course of time it was altered and 38% was shared between the 4th defendant and defendants 2 and 3. Defendants 2 and 3 had approached Mr.Allirajah Subaskaran, with a proposal to divide the activities provided by the

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group with the suggestion that an entity be set up in Singapore under the name and style of Plintron Global Technologies Services Limited and the share holding pattern in Plinton Global Technologies Service

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http://www.judis.nic.in

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C.S.No.372 of 2019

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Limited will be replicated. In this context, defendants 2 and 3 had indepenently engaged deloitte consultants to generate a project proposal.

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The present suit has been directed against defendants 1 to 3 based on the apprehension that defendants 2 and 3 without any wherewithal to fund had engaged deloitte to generate project proposals. The said proposed project is funded by the 4th defendant based on the ageement. The duly incorporated company would vest in the 4th defendant through its subsidiary Proton Global Investments. Consequently, the 4th defendant proceeded to release funds to the tune of circa USD 2,750,000. In contravention of the understanding between the parties, instead of issuing equity shares, as was the case with the shareholding in Plinton Global Technology Solutions Pvt.Ltd. defendants 2 and 3 engineered the issuance of preference shares instead. Consequently, the control and management of the company

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was assumed by defendants 2 and 3 eventhough they were financially incapable of supporting a project of such magnitute.

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C.S.No.372 of 2019

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On receipt of the suit summon, the 1st defendant has

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filed an application to revoke the leave on the premies that the defendants 2 and 3 are mere shareholders and no cause of action falls within the jurisdiction of this Court. The plaintiff and the contesting defendants being outside the territorial jurisdiction of this Court, leave granted by this Court vide order dated 19.06.2019 in A.No.4030 of

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2019 has to be revoked.

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At this juncture, the plaintiff has filed a memo stating

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that the apprehension for filing the present suit has been wiped after

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the parties negotiated the issue and arrived at a settlement. Pursuant to the settlement, defendants 2 and 3, Plintron Holdings PTC Limited and Proton Global Investments Limited have executed a shareholders agreement on 24.08.2019, by which the preference shares issued to the plaintiff's group concern were converted to equity shares with voting rights. Post conversion, nothing survives for adjudication in this

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suit and the apprehension stands allayed.

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C.S.No.372 of 2019

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A memo filed on behalf of the plaintiff is extracted

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below:

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1.The plaintiff has filed the suit seeking for permanent injunction against defendants 1 to 3 from interfering with the services provided by the 1st defendant company to the plaintiff. The necessity of the suit stemmed from the fact that the defendants 2 and 3 had issued the preferential shares, instead of equity shares, as earlier agreed upon in the holding company namely, Plintrol Holdings PTE Ltd., registered in Singapore, of the 1st defendant company. The plaintiff had an apprehension that in the event steps were taken to seek conversion of preference shares in Plintron Holdings PTE Ltd., the defendants 2 would use their control over the holding company and disconnect the telecom services being provided by the 1st defendant. This Hon'ble Court had appreciated the plaintiff's contention and protected its interest.

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2.On the defendants entering appearance, the parties negotiated the issue and arrived at a settlement. Accordingly, the defendants 2 and 3, Plintron Holdings PTE Ltd and Proton Global Investments Ltd have executed a shareholders agreement on 24.08.2019 and by which the preference shares issued to the plaintiff's group concern were converted to equity shares with voting rights. Simultaneously, on the same day, the plaintiff

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C.S.No.372 of 2019

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issued a letter withdrawing all claims.

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3.Post conversion, the shareholding of the plaintiff in the holding company of the 1st defendant is 60%.Consequently, nothing survives for adjudication in the suit and the apprehension stands allayed.

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In view of the subsequent agreement entered between the parties, nothing survives for adjudication in the suit. Hence, the Civil Suit is dismissed as withdrawn. The plaintiff is entitled for refund of Court fee as per Law. Consequently, connected applications are closed.

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27.01.2020

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Index:yes/no Internet:yes/no Speaking order/non speaking order ari

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http://www.judis.nic.in

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C.S.No.372 of 2019

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Dr.G.JAYACHANDRAN,J.
ari
C.S.No.372 of 2019
27.01.2020