Advocate Amol Nehru

Questions Answered by Advocate Amol Nehru

Q: Majority shareholder trying to diminish shares of minority shareholder

Can a majority shareholder diminish or make shares of minority order diminish or null by infusing his own capital? How can minority shareholder protect himself?

Advocate Amol Nehru answered
Any act by the majority shareholders to diminish or reduce the shareholding of the minority shareholders would be considered to be an act of oppression against the minority shareholders under Section 241 of the Companies Act, 2013 and you can seek an injunction order against the majority shareholders from doing such an act and preclude the majority shareholders from diminishing or reducing your shareholding without your consent.

Q: Partner sent legal notice in LLP regarding returns

Dear Sir , i formed LLP , however my partner is not at all helping with day to day activities and tried to create hindrances with my network and good image i managed to bring investor for start up however because of his behavior and change of attitude the investor backed off, now what ever investor has invested ,he is asking returns , and now my partner is not willing to return , my image is at stake ,besides my partner is also not helping in GST fillings etc , didnt share account details ,also started new venture similar to current start up without informing me . pls advice . in between he has also sent me notice putting false allegations

Advocate Amol Nehru answered
From you question, it appears that your partner has set up a competing business, while being partner in your LLP. It also appears that as a result of his actions, the investor has demanded a return of his investment, which your partner has refused to do. As a result of this, your LLP (which includes you as a partner) could potentially face legal action from the investor. You have also stated that your partner has sent you a legal notice making false allegations against you. Being a partner of the LLP, you are jointly liable for all actions or inactions of the LLP. There are several actions that you ought to take starting with an appropriate reply to your partner's notice enumerating all the wrongs committed by your partner that has been detrimental to the business of the LLP and to your interests as a partner of the LLP.