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2017 (8) TMI 47 - HC - Companies LawCivil suit to declare the appointment/co-option of some of the defendants/Directors of a Private Limited Company - grant permanent injunction restraining them from any manner functioning as Directors of that company - injunction restraining the said company from conducting any Extraordinary General Body Meeting/Annual General Body is maintainable in a civil court, in the light of Section 430 of the Companies Act, 2013 - Held that:- The word member employed in Section 241 of the Act cannot be given a restricted meaning. If restricted meaning is given, it may lead to abuse of the process law, as it is found in this case. Hence, it is essential to apply the doctrine of reading down to make the provisions under Chapter XVI of the Act purposeful. The golden Rule of statutory construction is that the words and phrases or sentences should be interpreted according to the intent of the legistature that passed the Act. Section 241 and 242 should be read together. If the words of the statutes raises doubt, it is inevitable to call in aid the ground and cause of making the statute and the mischiefs, which the Act intends to redress. Under the new Companies Act, 2013, the intention of the legistature is to vest the power of adjudication the matters referred in Section 242 to the Tribunal. On applying the Doctrine of Reading Down, an internal aid to construe the word in a statute to give reasonable meaning, so as to give the supposed purpose the word member referred in Section 241 of the Act, should not be read in isolation or in strict meaning. The word should be read down along with Section 242 of the Act. Therefore, the phrase 'member of the company' in Section 241 mean and include person not only member of the company is strict sense but, also person who bears the character of a member or have substantial interest in the internal affairs of the company . If the plaintiffs claim status as non-member, the disclosed cause of action in the plaint is illusion and irrelevant for third parties, since they have no locus standi to interfere with the affairs of the indoor- management of a Private Limited Company. If they claim status as Directors of the Company, they carry all trappings/characters of a member of the Company. So, to protect the interest of the Company, the remedy for them is under Section 242 of the Companies Act, 2013. Either way the Civil Court has no jurisdiction to entertain the subject matter of the suit. In the light of Section 430 of the Companies Act, 2013 and the alternate redressal forums being adequately provided under the Act, the plaint is not maintainable. Civil Revision Petition is allowed.
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