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2023 (12) TMI 187 - AT - Companies LawRectificatory jurisdiction - Willful violation of Orders of Hon'ble Company Law Board - transfer of shares - rectification of Register of Members of Respondent No. 1 Company - whether the rectificatory jurisdiction under Section 59 of the Act, which is summary in nature can be exercised where there are contested facts and disputed questions? HELD THAT:- Since, the Tribunal has relied upon the decision in the case of Ammonia Supplies [1998 (9) TMI 427 - SUPREME COURT] and IFB Agro [2023 (1) TMI 257 - SUPREME COURT] which has also been relied upon by Counsel for the Respondent, therefore, it would be apt to deal with two decisions to find out as to whether these decisions would apply? In the case of Ammonia Supplies, Section 155 of the Act of 1956 was in question which deal with the power of company court to rectify the register of members maintained by a company. The word ‘rectification’ has been defined as something what ought to have been done but by error not done and what ought not to have been done was done requiring correction. In this case, the question was framed as to whether in the proceedings under Section 155 of the Act of 1956, the court has exclusive jurisdiction in respect of all the matters raised herein or has only summary jurisdiction? The Hon’ble Supreme Court held that the company court under Section 155 has to adjudicate in the facts and circumstance whether the dispute raised really pertains to rectification or under the garb of rectification questions of fact involving contentious issues are raised and if dispute found to be relating to the peripheral field of rectification, then the company court under Section 155 will have exclusive jurisdiction but if finding is otherwise then the civil court’s jurisdiction is not excluded. In the case of IFB Agro, the Hon’ble Supreme Court was considering the question in regard to the scope of the rectificatory jurisdiction of the NCLT under Section 59 of the Act and was called upon to determine the appropriate forum for adjudication and determination of violations of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations 1997 and Securities and Exchange Board of India (prohibition of insider trading) Regulations 1992 framed under the Securities and Exchange Board of India Act, 1992. It was held that under Section 59 of the Act, in view of the Ammonia Supplies (Supra) the jurisdiction is summary in nature and not intended to be exercised where there are contested facts and disputed questions and in regard to the second issue it was held that transactions falling within the jurisdiction of Regulatory bodies created under a statute must necessarily be subjected to their ex-ante scrutiny, enquiry and adjudication. Thus, once the legislature has created a complete bar of the jurisdiction of the Civil Court by enacting Section 430 in the Act as per which no civil court shall have the jurisdiction to entertain any suit or proceedings in respect of any matter which the Tribunal or Appellate Tribunal is empowered to determine by or under this Act or any other law for the time being in force and no civil court has the jurisdiction to grant injunction in respect of any action taken or to be taken in pursuance of any power conferred by or under the act or any other law for the time being in force by the Tribunal or Appellate Tribunal, there is no shred of doubt that the jurisdiction to decide the rectificatory jurisdiction under Section 59 of the Act shall be available to be exercised even where there are contested facts and disputed questions and regard may be had to the decision in the case of Shashi Prakash Khemka [2019 (2) TMI 971 - SUPREME COURT] as decided by the Hon’ble Supreme Court while referring to Section 430 of the Act. The impugned order set aside - appeal allowed.
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