TMI Blog1963 (6) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... umstances under which the order was made. The company was ordered to be wound up by the High Court of Bombay on April 16, 1956. Consequent on the reorganisation of States, the winding up proceedings of the company pending in the High Court of Bombay on November 1, 1956, were transferred to this court. It was numbered as C.P.(B) 28/1956 and the official liquidator of this court assumed charge of the winding up proceedings. On the basis of information gathered from certain reports concerning the affairs of the company, the official liquidator made an application under section 235 of the Indian Companies Act, 1913 (Central Act VII of 1913), herein, after referred to as "the Act", read with section 45H of the Banking Companies Act, 1949, to examine into the conduct of 14 respondents named therein and direct them all or such of them as the court may determine to be liable in particular or generally or jointly, to repay and restore the money of the company which the court may fix. The application, styled as "Report No. 20", alleged that the respondents have been guilty of misfeasance, breach of trust and fraudulent conduct in relation to the company and they have misapplied or become l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, fourteenth respondent, do appear in this court to give evidence on examination on oath in open court on Wednesday, the third of April, 1963, at 2-45 p.m. They will continue to attend every day of the subsequent hearing of the application until they are permitted to retire from court. Out of these four respondents, two of them, viz., the third respondent, P.A. Tendolkar, and the seventh respondent, R.N. Kalgahatgi, are now present in court. They will take note of this order. In addition the office of the court will serve them with a formal notice under the seal of this court. Similar formal notices will issue by registered post to the second respondent, S.K. Samant, and D. B. Kulkarni. Because the trial has yet to proceed, I have stated above only the essential considerations leading to my making this direction. Further and fuller reasons will be stated in the final order, because to discuss them now is, in my opinion, likely to embarrass one or the other of the parties during the remaining stages of the trial. " Against the said order respondents Nos. 3, 5 and 7 in the misfeasance proceedings have preferred the above appeal. In the meanwhile, the first respondent is the of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder made or a decision given by a company judge in winding up and the second part which deals with " the manner and the conditions in which an appeal may be preferred " only refers to the procedural aspect of an appeal and the forum to which the appeal would lie : vide Bachharaj Factories Lid. v. Hirjee Mills Lid. [1955] 25 Comp. Cas. 227 The Bombay view was accepted by a Bench of this court in Premier Insurance Co. Lid. v. Davangere Cotton Mills Ltd. [1961] 31 Comp. Cas. 737 Section 4 of the Mysore High Court Act provides for an appeal from a judgment, decree or order of a single judge in the exercise of the original jurisdiction of the High Court to a Bench consisting of two other judges of the High Court. Section 4 reads thus: "4 Appeals from decisions of a single judge of the High Court. An appeal from a judgment, decree, order or sentence passed by a single judge in the exercise of the original jurisdiction of the High Court under this Act or under any law for the time being in force, shall lie to and be heard by a Bench consisting of two other judges of the High Court." While clause 15 of the Letters Patent states that an appeal shall lie to a Bench from the "j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order under appeal on the following two main grounds : IThat the court has no power to summon a party to an action against his wish to give evidence on oath. II.That the order is arbitrary since it has failed to note the objections urged and give reasons for the order. Re Point Number I : Learned counsel argued that section 235 of the Act provides for a summary mode of enforcing rights which must otherwise have been enforced by a regular suit, that the procedure prescribed by the Code of Civil Procedure is applicable to the trial of misfeasance proceedings to the extent they are consistent with the nature of the proceedings and that under the Code the court has no power to summon a party to the proceedings against his will to give evidence. He sought support for his argument from section 165 of the Evidence Act which empowers a judge to put questions to any witness or party before him. He further argued that it is only under section 195 or 196 of the Companies Act, that a judge has the power in winding up proceedings to summon any director or other officer of a company for examination on oath, but the power under the said sections cannot be invoked or relied upon for summon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 115 of the English Companies Act corresponding to section 195 of the Act. Shri Karanth cited some cases of the English courts wherein it is observed that justice is best done by a judge who holds a balance between the contending parties without himself taking part in their disputations and if a judge should himself conduct the examination of witnesses," he, so to speak, descends into the arena and is liable to have his vision clouded by the dust of the conflict." Learned counsel relied on the observations of the Court of Appeal in In re Enoch and Zaretzky Bock and Co.'s Arbitration [1910] 1 K.B. 327 , to the effect that a judge has no power to call witnesses in a civil dispute. That was a case arising out of arbitration proceedings where the award of the arbitrator had been challenged on the ground that the arbitrator had called witnesses of his own accord against the will of either of the parties to the arbitration, and that amounted to legal misconduct. It was observed by Fletcher Moulton L.J. that an arbitrator occupies a judicial position and exercises judicial powers and that a judge has no power to call such witnesses that he considers necessary in the inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the English Court of Appeal in a modern case changed its view, holding now that in a civil case the judge may not call a witness : In re Enoch and Zaretzky Bock Co. [1910] 1 KB. 327, 332 approved in Rex v. Harris . [1927] 2 KB. 587 But the reason given by L.C.J. He wart in the latter case is astonishing: In civil cases the dispute is between the parties and the judge merely keeps the ring. This philosophy is not only low in its standard, but is false to the conduct and status of the English judge during the last three centuries. It can hardly be doubted that before long in the highest tribunal these two rulings will be repudiated, and a return be witnessed to the principle laid down by Edmund Burke," At page 268 Professor Wigmore concludes his discussion by stating " that a trial judge may call a witness not called by the parties, or may consult any source of information on topics subject to judicial notice or may put additional questions to a witness called by the parties, or may ex mero motu exclude inadmissible evidence, or may take a view of a place or thing." He proceeds stating " that the trial judge has no power to cause the evidence produced by the parties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a witness against his will. The language of rule 14 assumes that there is an inherent power in the court to summon a party. In the absence of any statutory or constitutional bar precluding the summoning of a party by a judge, we are not prepared to accept the argument of the learned counsel that the court has no inherent power in a civil action to summon a party to give evidence in the case. Ordinarily,* there may be no occasion for a judge in a civil action to summon a party as a witness against his will. But in proceedings like the winding up of a company, where proceedings are initiated by the official liquidator, who is an officer of the court, and the directors and other officers of the company, who are the best persons to explain their Conduct in regard to the affairs of the company, stay away from the witness box, it may become necessary for the court in the exercise of its inherent power to summon even a party against his will to give evidence on oath. The first ground of objection that the courts has no power to summon the parties to give evidence in misfeasance proceeding a therefore, fails. Re : Point Number II: The second ground of objection also, in our view, is w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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