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2021 (11) TMI 957 - HC - Companies LawSeeking declaration, mandatory & perpetual injunction against the appellants - forfeiture of right to receive equity shares in respect of Secured ‘Zero’ Fully Convertible Debentures (FCD) - HELD THAT:- The submissions made that the jurisdiction to deal with the subject matter of the suits lay with the Company Law Board under the provisions of Section 111A of the Act, apparently have no substance. In a case where the Company refuses to register transfer / transmission of shares or debentures, the transferee could appeal to the then Company Law Board. However, the provision does not deal with a case of forfeiture of either shares or debentures and as such, the power in this regard lies only with the civil courts - As the jurisdiction under Section 111A of the Act has been consistently held to be limited to transfer and transmission of shares / debentures, challenge laid to forfeiture cannot obviously be entertained by the Company Law Board as determined by the Bombay High Court and the Company Law Board itself and as such, the plea raised pertaining to lack of jurisdiction of the civil courts apparently has no substance. As provisions of Section 122 of the Act provide for specific performance of contract to subscribe for debentures and the same can be enforced by a decree, the same necessarily means that the action pertaining to the allotment or forfeiture of debentures can be questioned before the civil courts - the applications were filed under Order VI, Rule 17 CPC and not under Order I, Rule 10 CPC, therefore, as it was not a case of impleading a new party and the applications were only to bring the cause title of the suits in consonance of the present status of the defendant–Company as such, the plea in this regard also has no substance. The attempt to question the validity of orders passed under Order IX, Rule 7 CPC, has been noticed only to be rejected as the appellant had the opportunity to question the validity of the orders during pendency of the first appeals by filing cross-objections in the appeals filed by the respondents-plaintiffs, however, no such attempt was made either by filing cross-objections or by raising issue in this regard during course of hearing in the appeals and as such, the said orders having attained finality, cannot be made subject matter of challenge in the present second appeals - Appeal dismissed.
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