Cars & Rides Ltd., is a company engaged in the trading of second-hand cars of any make. In the year 2020, it made an Initial Public Offer (IPO) of equity shares having face value of ₹10. Of which ₹5 as first call was

Chapter XVI of the Companies Act, 2013 (the Act) comprising of Sections 241-246 contains the statutory provisions for Prevention of Oppression and Mismanagement in a company. Section 241(1) of Act provides that any member of a company who complains that: (a) the affairs of the company have been or are being conducted in a manner prejudicial to public interest or in a manner prejudicial or oppressive to him or any other member or members or in a manner prejudicial to the interests of the company; or (b) the material change, not being a change brought about by, or in the interests of, any creditors, including debenture holders or any class of shareholders of the company, has taken place in the management or control of the company, whether by an alteration in the Board of Directors, or manager, or in the ownership of the company's shares, or if it has no share capital, in its membership, or in any other manner whatsoever, and that by reason of such change, it is likely that the affairs of the company will be conducted in a manner prejudicial to its interests or its members or any class of members, may apply to the Tribunal, provided such member has a right to apply under section 244, for an order under this Chapter. Section 244(1)(a) of the Act states that the following members of a company shall have the right to apply under section 241 of the Act, (a) in the case of a company having a share capital, not less than one hundred members of the company or not less than one-tenth of the total number of its members, whichever is less, or any member or members holding not less than one-tenth of the issued share capital of the company, subject to the condition that the applicant or applicants has or have paid all calls and other sums due on his or their shares. The words used in the clause (a) of sub-Section (1) of Section 244 is 'the issued share capital' subject to the condition that the applicant or applicants has or have paid all calls and other sums due on his or their shares. This implies the words "issued share capital" as used in the section will always consist of paid-up capital either fully paid to the extent of the calls already made by the company on such issued shares. In the given case the company has made calls for making the shares fully paid up and thus all the members are required to pay their full dues i.e. the entire money called by the company, and any members have not paid such calls or any part thereof shall be construed to have not paid all their dues on their shares and accordingly such members who have not paid their dues w.r.t. such party-paid shares shall not be eligible under Section 244(1) of the Act to make an application with the Tribunal.