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Showing contexts for: section 634a in Padma Taparia vs Assam Brook Ltd. And Ors. on 6 February, 1996Matching Fragments
12. Shri Sudipto Sarkar, senior advocate, appearing on behalf of respondent No. 9, made the following three preliminary observations, namely : (i) no relief can be granted under Section 247 of the Act by the Company Law Board as the provisions contained therein can be invoked only by the Central Government and the powers are vested solely and wholly in the Central Government, (ii) Admittedly, no case has been made out under Section 250(3) and (4) of the Act. On their own showing in the petition, the subject shares are much less than. 25 per cent, of the paid-up capital of the company. Respondent No. 9 whom he is representing owns less than 5 per cent. The management of the company has not experienced any difficulty in passing resolutions in general meetings as per admissions in the petition itself. According to the petition, the subject shares constitute only 13.37 per cent, of the paid-up capital (para VI, cc page 22)-The annexures to the petition also show that the respondents have not acted in concert. Further, according to the petition, the management itself holds more than 35 per cent besides the substantial holding by financial institutions (page 55 of the petition). In such circumstances, following the decision of the Company Law Board in Molins of India's case (C. P. No. 13/14/25 of 1990), the petition is liable to be dismissed, (iii) No order can be passed by the Company Law Board under Section 247(1A) of the Act when no case is made out under Section 250(3) and (4) of the Act as decided by the Company Law Board in Alaknanda Manufacturing and Finance (P.) Ltd. v. Bahubali Services Limited [1993] 3 Comp LJ 423 ; [1996] 86 Comp Cas 291 (CLB). Elaborating further he said that the power conferred under Section 250(1) can be exercised only if either a reference is made by the Central Government or a complaint made by any person in this behalf. According to him, the words "in this behalf" used in Section 250(1) mean, there should be already a reference from the Central Government under Sections 247 to 249 in connection with relief under Sections 248 and 249. Since there is no reference and there is no complaint in connection with any such reference, the condition precedent for invoking Section 250(1) is wholly absent. He further stated that the provisions under Section 250(2) of the Act are in aid of and ancillary to Section 250(1) of the Act. So long as a substantive case under Section 250(1) has not been made out, the ancillary provisions cannot be invoked. He further stated that the petition has been filed with collateral object and improper motive. The complete particulars of litigations involving the company as contained in the records of the company could not have been provided without the active involvement of the company. The petitioner is, therefore, not a bona fide litigant whereas the company is the actual litigant. This is also evident from the delay on the part of the company to register one lakh shares belonging to respondent No. 9 already directed to be registered as per orders of the Eastern Bench of the Company Law Board. The company is further litigating even on the order under Section 634A passed by the Eastern Bench. Therefore, he sought for dismissal of the petition.