Rajasthan High Court - Jaipur
Saurabh Agrotech Pvt. Ltd vs Vijay Solvex Limited on 18 October, 2024
Author: Sameer Jain
Bench: Sameer Jain
[2024:RJ-JP:40467]
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Company Appeal No. 1/2015
1. Saurabh Agrotech Pvt. Ltd., Registered Office:- Plot No. 20, 21
& 22, Old Industrial Area, Alwar-301001, Rajasthan, through its
Authorized Signatory
2. Babu Lal Data (HUF), Plot No. 20, 21 & 22, Old Industrial
Area, Alwar-301001, Rajasthan, Through its Karta.
3. Ajay Data, D-47, Hanuman Nagar, Vaishali Nagar, Jaipur-
302021.
4. Deepak Data, D-47, Hanuman Nagar, Vaishali Nagar, Jaipur-
302021.
5. Babu Lal Data, Plot No. 20, 21 & 22, Old Industrial Area,
Alwar-301001, Rajasthan.
----Appellants
Versus
1. Vijay Solvex Limited, Registered office- Bhagwati Sadan,
Swami Dayanand Marg, Alwar-301001 (Raj.), Through its
Authorized Signatory.
2. Deepak Vegpro Pvt. Ltd., Registered Office- Old Industrial
Area, Itarana Road, Alwar-301001. Through its
Authorized Signatory.
3. Indo Caps Pvt. Ltd., Registered Office- Old Industrial
Area, Itarana Road, Alwar-301001. Through its
Authorized Signatory.
4. Pyarelal Gangadeen (HUF), Bhagwati Sadan, Swami
Dayanand Marg, Alwar-301001. Through its Karta.
5. Niranjan Lal Data (HUF), Bhagwati Sadan, Swami
Dayanand Marg, Alwar-301001. Through its Karta.
6. Niranjan Lal Data, Bhagwati Sadan, Swami Dayanand
Marg, Alwar-301001.
6/1- Daya Kishan Data S/o Late Shri Niranjan Lal Data,
Bhagwati Sadan, Swami Dayanand Marg, Alwar-302001
(Raj.)
6/2- Smt. Nirmala Data W/o Late Shri Niranjan Lal Data,
Bhagwati Sadan, Swami Dayanand Marg, Alwar-301001
(Raj.)
6/3- Smt. Pushpa D/o Late Shri Niranjan Lal Data W/o Late
Shri Jayprakash, Mahavar Emporium, 27, Naya Bazar,
Kamla Nagar, Delhi.
6/4- Smt. Shashi Gupta D/o Late Shri Niranjan Lal Data W/o
Shri Ramesh Gupta, A-99, Industrial Area, Bhiwadi, Alwar.
6/5- Smt. Uma Gupta D/o Late Shri Niranjan Lal Data W/o Shri
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[2024:RJ-JP:40467] (2 of 18) [COA-1/2015]
Vinod Gupta, Krishna Rolling Mills, Jhotwara, Jaipur.
6/6- Smt. Sushma D/o Late Shri Niranjan Lal Data W/o Shri
Tejaram, Rajasthan Traders, Y-175, Loha Mandi,
Narayana, New Delhi.
7. Ramesh Chand Gupta, Bhagwati Sadan, Swami Dayanand
Marg, Alwar-301001.
8. Saurabh Data, Bhagwati Sadan, Swami Dayanand Marg,
Alwar-301001.
9. State Bank of Bikaner & Jaipur, Near Old Bus Stand,
Alwar-301001 (Raj.)
----Respondents
For Appellant(s) : Mr. Harshit Tholia Senior Adv.
Mr. Anuroop Singhi Mr. Rahul Khandelwal Mr. Aditya Vijayvergia For Respondent(s) : Mr. Narendra Mohan Sharma Senior Adv.
Mr. Amol Vyas Mr. Utkarsh Sharma Mr. Saumil Sharma HON'BLE MR. JUSTICE SAMEER JAIN Judgment REPORTABLE Reserved on : 21/09/2024 Prounounced on : 18/10/2024
1. The instant appeal is preferred with the following prayers:
"It is, therefore, most humbly and respectfully prayed that this Hon'ble Court may graciously be pleased to:
a. Admit the present appeal and call for the record of CP No. 23/111/2010 with CA No. 167/13 from the Company Law Board, New Delhi Bench, New Delhi, b. Set aside the order dated 22/10/2014 passed by the Company Law Board, New Delhi Bench, New Delhi in CA No. 167/2013 in CP No. 23/111/2010, (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (3 of 18) [COA-1/2015] c. Allow CA No. 167/2013 filed by the appellants before the learned Company Law Board, New Delhi Bench, New Delhi. d. Pending hearing and disposal of the present appeal, stay further proceedings in the subject Company Petition being CP No. 23/111/2010 pending before the Company Law Board, New Delhi Bench, New Delhi.
e. Pass ad interim ex-parte order in terms of prayer (d) above;
f. Pass such other or further order(s) as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case."
2. For the sake of convenience the provisions relied by the parties are tabulated herein below:
Provisions of Head note Statute
law
Section 2(29) Definition - 'Court' Companies Act,
2013
Section 435 to (Chapter XXVIII) Companies Act,
Special Courts
446 2013
Section 408 Constitution of National Companies Act,
Company Law Tribunal 2013
Section 43, 56, (Chapter IV) Companies Act,
Share Capital and
58, 59, 430 2013
Debentures
Section 10 FB Constitution of National Companies Act,
Company Law Tribunal 1956
Section 10E Constitution of Board of Companies Act,
Company Law 1956
Administration
Section 10F Appeal against the orders Companies Act,
of Company Law Board 1956
Section 10GB Civil Court not to have Companies Act,
jurisdiction 1956
Section 108 Transfer not to be Companies Act,
registered except on 1956
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[2024:RJ-JP:40467] (4 of 18) [COA-1/2015]
production of instrument
of transferred
Section 111 Power to refuse Companies Act,
registration and appeal 1956
against refusal
Section 111(A) Rectification of register on Companies Act,
transfer 1956
Section 26 When instrument may be Specific Relief Act,
rectified. 1963
Section 31 When cancellation may be Specific Relief Act,
ordered. 1963
Order VII Rule 11 Rejection of Plaint Code of Civil
Procedure, 1908
Rule 44 Saving of inherent power Company Law
of the Bench Board Regulations,
1991
3. The present appeal is preferred under Section 10F of the Companies Act, 1956, assailing the judgment dated 22.10.2014 passed by the Company Law Board, New Delhi in CA No. 167/2013 in CP No. 23/111/2010, vide which the application filed by the appellant under Rule 44 of Company Law Board Regulations, 1991, praying dismissal of the company petition at the threshold, is dismissed.
SUBMISSIONS BY THE APPELLANTS
4. Learned counsel appearing for the appellants averred that the germane facts for consideration of the instant matter have been that the respondents preferred a Company Petition (bearing no. 23/111/2010) under Section 111(4) of the Companies Act, (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (5 of 18) [COA-1/2015] 1956 (hereinafter referred to as the Act of 1956) vis-à-vis rectification of share register of appellant no. 1-Company, seeking removal of the names of appellant nos. 2-5, and for restoration of their names in the place of the appellants.
5. It was further averred that the said removal of names, has been sought primarily qua the private dispute ongoing inter-se between the parties. The respondent no. 1- Company has been registered under the provisions of the Act of 1956, qua which the appellants and non-appellants have been the share- holders/members. Resultant to which the appellant filed share transfer deed under section 108 of the Act of 1956.
6. Further, it was contended that the nature of the allegations made therein, were to be adjudicated after considering the evidences and witnesses, and the Company Law Board (hereinafter referred to as CLB) is incompetent to consider the matter before it and the same ought to be considered by a Civil Court as per the provisions of Section 9 of C.P.C. Likewise, there have been umpteen other disputed question of facts, which per se pertain to civil nature. Therefore, the said Company Petition which ostensibly requires a thorough judicial examination, based on various evidences, hence, is ultra vires to the summary jurisdiction of the company court i.e. CLB/ NCLT.
7. At this juncture, learned counsel had drawn the attention of the Court towards the contents of the impugned judgment dated 22.10.2014, and had submitted that the CLB whilst adjudicating the said dispute had itself opined and had categorically stated that "a thorough judicial examination is required based on the (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (6 of 18) [COA-1/2015] evidences" is mandated, which cannot be adjudicated in a summary trial, nonetheless, ignoring the aforementioned facts and circumstances of the matter in hand and neglecting the observation made by itself, CLB vide its judgment dated 22.10.2014, dismissed the application of the appellants.
8. In support of the contentions made insofar learned counsel had placed reliance upon the ratio encapsulated in (2023) 4 SCC 209 titled as IFB Agro Industries Ltd. vs. SICGIL India Ltd. and Ors. and Company Appeal (AT) (CH) No. 95/2023 titled as Gireesh Kumar Sanghi vs. Sanghi Industries Ltd. & 19 Ors.
9. Whilst placing reliance upon the afore-cited judgments it was averred that as per the statutes the CLB can conduct trial in a summary matter, howsoever, qua the instant dispute, questions of facts, for instance, allegations of fraud, misrepresentation etc. were to be adjudicated. It is a settled position of law that the said issues can be dealt only after following the due procedure of evidence, hence, the same cannot be adjudicated by the CLB. Withal, the aforesaid issues of fact and law, the points for adjudication also pertains to the in toto rights, shares and interest therefrom the Company. Therefore, the instant matter is ought to be adjudicated by a Civil Court.
10. Lastly, learned counsel representing the appellants had contended that the Court would have exercised the powers under Order VII Rule 11 of C.P.C. and should have not taken the matter themselves for adjudication. Thus, the impugned order has a (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (7 of 18) [COA-1/2015] palpable error and the said petition had not been tenable to be adjudicated before the learned CLB/NCLT. SUBMISSIONS BY THE RESPONDENTS
11. Per contra, learned counsel representing the respondents/ non-appellants had contended that the blank transfer deeds, duly signed by the respondents have been misused by the appellant nos. 2-5, for the impugned transfer of shares. It was further contended that the appellants way back in the year 2007, sans the knowledge of the respondents have taken away certain papers including original share certificates and blank signed transfer deeds.
12. Moreover, the appellant nos. 2-5 have committed fraud and fabricated the documents/records to justify the transfer of the impugned shares. It was further contended that the Company Petition had been filed in the year 2010 before the CLB, qua which the reply (on merits) was filed by the appellants in January, 2011. Likewise, records were called by the CLB on 22.07.2013 and thereafter, at a belted stage the appellants herein, have raised an objection qua maintainability of the said Company Petition and a prayer to dismiss the said petition on 26.08.2013, by way of application no. 167/2013.
13. Learned counsel had further averred that the controversy qua the matter in hand, arose when the learned CLB called for the original records, passed the impugned order and the company application (167/2013) of the appellants was disposed of, and consecutively, the issue of jurisdiction and maintainability before the CLB was turned down.
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14. It was further submitted that the contention raised by the appellants qua forgery, fabrication and manipulation of documents have been made at a subsequent juncture and not in the objection/application raised/made before the learned CLB. Learned counsel representing the non-appellants had further averred that in the year 2013, repealing the old Companies Act, 1956, the new Companies Act 2013 (hereinafter referred to as Act of 2013), has been enforced. Henceforth, the applicability of the Act of 2013 prevails. At this juncture, learned counsel had placed reliance upon the provisions enshrined under Section 424, 429, 430, and 434 of the Act of 2013, and had averred that the said provisions make it unambiguously clear that the Tribunal and the Appellate Tribunal i.e. NCLT after implementation of the Act of 2013, ought to/ shall have the same powers as vested in the Civil Courts, while adjudicating the lis before them. Hence, all the proceedings subjudice before the Tribunal shall be considered as the judicial proceedings.
15. Subsequently, learned counsel had drawn the attention of this Court towards the contents of Section 434(1)(c) of the Act of 2013 and had submitted that the as per the objective of the Act and the provisions interpreted therein, it can be unequivocally concluded that all the proceedings under the Act of 1956, including proceedings relating to arbitration, compromise, arrangements and reconstruction and winding up of companies, pending immediately before such date, before any District Court or High Court, shall stand transferred to the Tribunal and the (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (9 of 18) [COA-1/2015] Tribunal may proceed to deal with such proceedings from the stage before their transfer.
16. Lastly, to substantiate the contentions made insofar learned counsel had placed reliance upon the dictum enunciated in Shashi Prakash Khemka and anr. Vs. NEPC Micon and ors. reported in (2019) 18 SCC 569, and had averred that as per the provisions of Section 430 of the Act of 2013, no civil court shall have the jurisdiction to address/entertain any suit or proceedings for which the Tribunal is entitled to exercise its jurisdiction. The relevant extract from the afore-stated provision has been reproduced herein below:
"430. Civil court not to have jurisdiction. ..........(c) No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under this Act or any other law for the time being in force and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or any other law for the time being in force, by the Tribunal or the Appellate Tribunal."
OBSERVATION
17. Upon an assiduous scanning of the record, considering the aforementioned facts and circumstances of the case, considering the judgments cited at the Bar and taking note of the arguments averred by the learned counsel for both the parties, this Court at this juncture, deems it appropriate to jot down indubitable facts:-
17.1 That the present appeal has been preferred assailing the judgment dated 22.10.2014 passed by the Company Law (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (10 of 18) [COA-1/2015] Board, New Delhi in CA No. 167/2013 in CP No. 23/111/2010 vide which the application filed by the appellant under Rule 44 of Company Law Board Regulations, 1991, praying dismissal of the company petition at the threshold (considering the objection of maintainability and jurisdiction), has been dismissed.
17.2 That the issue for adjudication herein, has been that the respondents filed a company petition before the CLB in the year 2010 under section 111(4) of the Act of 1956 (pari materia provision - Section 59 of the Act of, 2013), qua rectification of share register of appellant no. 1-Company. Accordingly, the said petition is maintainable or otherwise.
18. Considering the aforementioned discussions and findings;
juxtaposing the averments raised by the learned counsel for both the sides and taking note of the provisions enumerated under the Companies Act, 2013, this Court deems it apposite to dismiss the instant petition for the reasons noted herein below: 18.1 The Company Petition was filed in the year 2010 before the learned CLB, qua which without any objection being raised, a reply (on merits) was filed by the appellants in January 2011, and the learned CLB had called for the original record vide order dated 22.07.2013. Successively, at a belated stage on 26.08.2013 after seeking certain adjournments, an application was filed by the appellants qua the objection on the grounds of maintainability of the instant petition and that the said matter is ultra vires to the jurisdiction of the learned CLB. The said application also holds allegations of forgery and fabrication by the non-appellants. (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (11 of 18) [COA-1/2015] 18.2 In due course, the learned CLB had directed to procure the original records/documents on 22.07.2013, to which the appellants have not objected within the stipulated time. 18.3 It is pertinent to note that the impugned judgment dated 22.10.2014, is self-explanatory, and reasonable. Moreover, is passed after considering the vital aspects of the instant matter on merits, and the provisions of the Act of 1956 and Act of 2013. It is also germane to note that the said judgment is passed after a punctilious adjudication for four years. The relevant extract from the impugned judgment dated 22.10.2014 has been reiterated herein below:
"5.1. On the other side, the respondents/appellants Advocate has pointed out that the present impugned transfer is ultimately of 2008 whereas the petitioner for the first time raised a complaint regarding the sale only in April 2010 and filed the present petition only in September, 2010. Despite the disputed contention of the petitioner Advocate that the impugned transfers were approved in the meeting of Board of Directors of Respondent No. 1 Company shown to have been chaired by the Respondent No. 6 whereas the said Respondent was not even a Director in Respondent in Respondent No. 1 Company on the said date, the Respondents Advocate has taken the plea that the said allegation does not give rise to a valid/relevant cause of action under Section 111(4) of the Companies Act, 1956. Apart from this, it has also been argued that the nature of controversy on merits which is to be decided in the present proceedings/Company Petition requires adjudication of highly/seriously disputed question of facts and therefore, this matter may be sent to Civil Court for adjudication. However, the petitioners/non-applicants Advocate pointed out that the transfer of shares has been challenged on multifarious grounds and even (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (12 of 18) [COA-1/2015] assuming that the petitioners failed in one of the grounds mentioned in the petition then it does not mean that it will fail on the other grounds before this Hon'ble Court. Moreover, it has been highlighted that the contents of paragraphs 3(b) & (d) of the Company Petition are of two separate incidents. In addition, a bare perusal of the alleged family settlement indicates that the attempted process of change of management continued till February, 2008 and it is only in the year 2008 that the blank signed transfer deeds and share certificates were taken away by the respondents.
5.2. The petitioner/non-applicants Advocate has pointed out that the challenge in the present application as to the maintainability is a pure question of law and the contention of the respondents Advocate that there is an acquiescence on the part of the petitioners is far fetched ground for the reason that acquiescence comes only when there is a consent on the part of the petitioner which has to be categorical and without any doubt. With regard to the exercise of powers under Order 7 Rule 11 CPC, the Hon'ble Apex Court while dealing with the case of "Church of Christ Charitable Trust vs. M/s. Ponniamman Education Trust" has clearly held that for the purpose of deciding an application under Order 7 Rule 11 CPC, the averments in the plaint are germane, the pleas taken by the defendants in the written statement would be wholly irrelevant at the stage and therefore, in order to consider Order 7 Rule 11 CPC, the Court has to look into the averments in the plaint and the averments in the written statement are immaterial and it is the duty of the Court to scrutinize the averments in the plaint.
5.3. Under the aforesaid facts and circumstances, it is observed that the respondent/applicants Advocate challenged the Company Petition on the ground of delay and latches, suppression of facts and acquiescence. On the other hand, the petitioners/non-applicants Advocate pleaded that there is no suppression of (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (13 of 18) [COA-1/2015] facts and acquiescence on the part of the petitioners. Moreover, it has been submitted that the impugned transfer of shares has been challenged on various grounds and in case the petitioners fail on some ground, it does not mean that the petition fails on other grounds as well. From all this, it is noticed that there is involvement of question of law and facts. As there are controversies as to the facts of the case, thorough judicious examination is required based on various evidences available as part of the pleadings. In view of this, it will be highly unfair, if the company petition is dismissed at the threshold without looking into the merits based on the documents/evidences available on record. As such, in the interest of justice, the prayer made in the present Company Application to dismiss the Company Petition at the threshold is hereby disallowed."
18.4. Therefore, this Court deems it apposite to note that the impugned order is sans any irregularity as the same is passed after considering the relevant provisions and the material facts and circumstances of the instant matter. Hence, reliance is placed upon the relevant provisions from the Act of 2013, i.e. Section 424, 430, and 434(c). Upon a bare perusal of the said provisions it can be deduced that the Tribunal and the Appellate Tribunal for the purpose of discharging their functions, shall exercise the powers as that of a Civil Court as per the provisions of the Code of Civil Procedure. Moreover, Section 430 of the Act of 2013 categorically states that no Civil Court shall have jurisdiction to entertain any suit or proceedings in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under this Act or any other law for the time being in force. The said provisions are reproduced herein below:
"424. Procedure before Tribunal and Appellate Tribunal-(1) The Tribunal and the Appellate (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (14 of 18) [COA-1/2015] Tribunal shall not, while disposing of any proceeding before it or, as the case may be, an appeal before it, be bound by the procedure laid down in the Code of Civil Procedure, 1908 (5 of 1908), but shall be guided by the principles of natural justice, and subject to the other provisions of this Act [or of the Insolvency and Bankruptcy Code, 2016] and of any rules made there under the Tribunal and the Appellate Tribunal shall have power to regulate their own procedure.
2. The Tribunal and the Appellate Tribunal shall have, for the purposes of discharging their functions under this Act [or under the Insolvency] and Bankruptcy Code, 2016] the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908) while trying a suit in respect of the following maters, namely;
(a) summoning and enforcing the attendance of any person and examining him on oath;
(b) requiring the discovery and production of documents;
(c) receiving evidence on affidavits;
(d) subject to the provisions of sections 123 and 124 of the Indian Evidence Act, 1872 (1 of 1872), requisitioning any public record or document or a copy of such record or document from any office;
(e) issuing commissions for the examination of witnesses or documents;
(f) dismissing a representation for default or deciding it ex parte;
(g) setting aside any order of dismissal of any representation for default or any order passed by it ex parte; and
(h) any other matter which may be prescribed. (3) Any order made by the Tribunal or the Appellate Tribunal may be enforced by that Tribunal in the same manner as if it were a decree made by a court in a suit pending therein, and it shall be lawful for the Tribunal or the Appellate Tribunal to send for execution of its orders to the court within the local limits of whose jurisdiction-
(a) In the case of an order against a company, the registered office of the company is situate; or
(b) In the case of an order against any other person, the person concerned voluntarily resides or carries on business or personally works for gain. (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (15 of 18) [COA-1/2015] (4) All proceedings before the Tribunal or the Appellate Tribunal shall be deemed to be judicial proceedings within the meaning of Sections 193 and 228 and for the purposes of section 196 of the Indian Penal Code (45 of 1860), and the Tribunal and the Appellate Tribunal shall be deemed to be civil court for the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).
430. Civil Court not to have jurisdiction- No civil court shall have jurisdiction to entertain any suit or proceedings in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by or under this Act or any other law for the time being in force and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act or any other law for the time being in force, by the Tribunal or the Appellate Tribunal.
434(c). .......... all proceedings under the Companies Act, 1956 (1 of 1956), including proceedings relating to arbitration compromise, arrangements and reconstruction and winding up of companies, pending immediately before such date before any District Court or High Court, shall stand transferred to the Tribunal and the Tribunal may proceed to deal with such proceedings from the stage before their transfer."
18.5 Further, reliance can be placed upon the ratio encapsulated in Shashi Prakash Khemka (Supra). the relevant extract from the afore-cited ratio has been reproduced herein below:
"6. It is not in dispute that were a dispute to arise today, the civil suit remedy would be completely barred and the power would be vested with the National Company Law Tribunal under Section 59 of the said Act. We are conscious of the fact that in the present case, the cause of action has arisen at a stage prior to this enactment. However, we are of the view that relegating the parties to civil suit now would not be the appropriate remedy especially considering (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (16 of 18) [COA-1/2015] the manner in which Section 430 of the Act is widely worded."
18.6. Moreover, reliance can also be placed upon the dictum enunciated in Chalasani Udaya Shankar and Ors. Vs. Lexus Technologies Pvt. Ltd. and Ors. registered as Civil Appeal Nos. 5735-5736 of 2023. The relevant extract from the afore- cited ratio has been reiterated herein below:
"28. In Shashi Prakash Khemka (Dead) through legal representatives asnd Anr. v. NEPC MICON (Now NEPC India Limited) and Ors (2019) 18 SCC 569, this Court again had occasion to deal with exercise of power Under Section 111-A of the Companies Act, 1956. The Company Law Board's view had been reversed by the Madras High Court in appeal, whereby the Appellants were relegated to the remedy of a civil suit in relation to the issue raised qua the transfer of shares. This Court took note of the earlier judgment in Ammonia Supplies Corporation (P) Ltd. (supra) but noted that Section 430 of the Act of 2013 barred the jurisdiction of the civil court and opined that the effect thereof is that, in matters in respect of which power has been conferred on the National Company Law Tribunal, the jurisdiction of the civil court is completely barred. This Court observed that it is not in dispute that, were a dispute to arise today, remedy of a civil suit would be completely barred and the power would vest with the National Company Law Tribunal under Section 59 of the Companies Act, 2013. Noting that the cause of action in that case had arisen at a stage prior to enactment of the Act of 2013, this Court was of the view that relegating the parties to a civil suit would not be the appropriate remedy, considering the manner in which Section 430 of the Act of 2013 was widely worded.
29. Shashi Prakash Kemka (supra) was followed by the National Company Law Appellate Tribunal, New Delhi, in Smiti Golyan and Ors. v. Nulon India Ltd. and Ors. whereby, the decision of the National (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (17 of 18) [COA-1/2015] Company Law Tribunal, Principal Bench, in relation to rectification proceedings was upheld without relegating the parties to the civil court. Civil Appeal No. 4639 of 2019 filed before this Court against Smiti Golyan (supra) was dismissed on 03.07.2019 and this Court observed that the findings recorded by the National Company Law Appellate Tribunal were absolutely proper and no ground was made out to interfere with the same."
18.7. Thus, after enforcement of the Act of 2013 and the dictum spelled out in the afore-cited ratios, this Court is of an opinion that the averments made by the learned counsel appearing for the appellants, qua the fact of jurisdiction and maintainability of the petition before the learned CLB is outstayed. Moreover, the said issue is already settled by the Hon'ble Apex Court in Shashi Prakash Khemka (supra), hence, is no longer res-integra. 18.8. Withal, the judgments cited by the learned counsel appearing for the appellants, i.e. IFB Agro Industries Ltd. (Supra) and Gireesh Kumar Sanghi (Supra) are not applicable to the matter in hand in entirety, as it is unambiguous fact that after enforcement of the Companies Act, 2013 the applicability of the erstwhile law shall be barred. Moreover, the afore-cited judgments are of distinguishable factual narrative and issue of law.
19. In summation of the aforementioned facts and circumstances of the instant matter, and considering the overall observations made insofar; specifically taking note of the provisions enshrined under the Act of 2013 i.e. Sections 424, 430, and 434(c) and the ratio encapsulated in Shashi Prakash Khemka (supra), this Court is of the opinion that the (Downloaded on 24/10/2024 at 09:54:33 PM) [2024:RJ-JP:40467] (18 of 18) [COA-1/2015] observations made in the impugned judgment are sans any palpable error and arbitrariness; moreover, once the powers are granted to the Tribunal or the Appellate Tribunal by the primary statute, the same cannot be relegated to the Civil Court.
20. In light of the above, the instant appeal being devoid of any merit stands dismissed with a cost of Rs. 2,00,000/- (Rupees Two Lacs Only). Cost to be deposited in the bank account(s) of the non-appellants, within a period of thirty days, from the date of passing of this order. The said cost is imposed considering the unwarranted delay tactics adapted by the appellants; the fact that the said matter was earlier referred for mediation proceedings, turning a blind eye towards the provisions of the Act of 2013 and bypassing the settled position of law in toto. Howbeit, no beneficial conclusion was attained from the said mediation proceedings moreover, a superfluous delay was caused.
21. Accordingly, the instant petition is dismissed with the aforementioned cost. Pending applications, if any, shall stand disposed of.
(SAMEER JAIN),J Anil Sharma/1 (Downloaded on 24/10/2024 at 09:54:33 PM) Powered by TCPDF (www.tcpdf.org)