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2012 (5) TMI 92 - HC - Companies LawAppeal against an order passed by CLB dismissing proceedings instituted u/s 397 and 398 of the Companies Act – assessee contested that once a statement was made in the petition asserting the requisite percentage of share-holding in the company, the petition could no longer be rejected out of hand on a point of demurrer in such regard without the appellants being permitted to explain the circumstances in which they claimed to meet the statutory benchmark - they complain that upon the petition having previously progressed to final hearing - which was completed - it was no longer open to the CLB for rejection – the CLB was of the view that the petition before it was hit by the principles of res judicata, constructive res judicata or issue estoppel and, as such, could not progress - Held that:- The impugned judgment betrays a total non-application of mind and worse - the CLB was not aware of the tools necessary for the assessment - Proceedings under Sections 397 and 398 of the Companies Act are an alternative to winding-up and are founded on the principles of justice and equity- If, according to the CLB, the issues that arose in the company petition had already been conclusively decided in previous proceedings for the principles of res judicata or constructive res judicata or issue estoppel to apply, it flies in the face of reason and logic that the CLB would still grant permission or leave to the petitioners before it to resurrect a matter that had already been previously concluded against them - The respondent no.1 will pay costs assessed at 3000 GM to the appellants - matter will now be heard by the CLB afresh open to arrive at the same conclusion as in the impugned order on the objection pertaining to the appellants' share qualification but with cogent reasons in support thereof
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