TMI Blog2016 (1) TMI 466X X X X Extracts X X X X X X X X Extracts X X X X ..... or the CLB to specifically use the words, prima facie case, balance of convenience and irreparable loss. It is sufficient if specific findings on the tests are given. Upon perusal of the order it is clear that the CLB has given findings in page 6, 7 and 8 of its order. Therefore, this court does not agree with the contentions of the Learned Senior Counsel for the petitioners that the CLB has not considered the questions raised before it. In so far as the personal grievance of the 7th respondent is concerned, there are specific findings in para 6 of the order of the CLB at pages 6 and 7 of the order. The communication of the 7th respondent has been referred to in page 7 of the order of the CLB indicating that the grievance is not just the elections. Again considering all these aspects only, this court in a nutshell held that there is no perversity in the findings of the CLB and the questions raised are not pure questions of law. Hence, there is no error apparent on the face of the record, warranting interference. In so far as oppression is concerned, any decision on the same can be arrived at only if the other questions are decided. On the face of it, the 7th respondent has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cess and oppression, the petition was filed seeking many reliefs. Interim reliefs in the nature of injunction to enable the 7th respondent to continue as a Director and also for certain directions were also filed. The Company Law Board refused to grant the interim reliefs. Aggrieved the appeals were filed. This court after elaborately hearing the parties, dismissed the appeals concurring with the views of the Company Law Board and issued directions for the early disposal of the Company petition. The orders were passed by this Court on 27.04.2015. It appears that though the present revision petitions were filed, the petitioners were not in a hurry to give life to it and moved Special Leave Petitions before the Supreme Court. Ultimately, they withdrew the SLPs with a liberty to rejuvenate the sleeping review petitions. While disposing of the SLPs, the Honourable Supreme Court has directed this Court to consider the review petitions at the earliest preferably within two weeks. The Review Petitions were listed on several dates at the convenience of the parties and heard at length. 3. The Learned Senior Counsel Mr.P.Chidambaram, appearing for the petitioner in R.P.No 95 of 2015 art ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the CLB is incorrect. The Learned Senior Counsel in support of his contentions relied upon the judgements reported in AIR 1961 SC 1633 (Commissioner of Income Tax, Bombay Vs. scindia Steam Navigation Co. Limited), AIR 1957 SC 49 (Sree Meenakshi Mills Limited Vs. Commissioner of Income Tax, Madras), AIR 1969 SC 460 (Oriental Investment Co. P Limited Vs. Commissioner of Income Tax, Bombay), AIR 1964 SC 1379 (Naunihal Kishan and others Vs. R.s.Ch.Partap Singh and another), 2014 7 BOMB CR 464 (Godrej Industries Limited), 2010 15 SCC 118 (Gian Singh Vs. State of Punjab and another) and 1990 69 Company Cases 372 (Guj) (Saurashtra Cement and Chemicals Industries Limited and others Vs. Esma Industries P Limited). 4. The Learned Senior Counsel Mr.R.Murari, appearing for the petitioners in R.P 94/15, adopting the arguments of the Learned Senior Counsel Mr.P.Chidambaram submitted that in view of the non-consideration of the questions of law raised in the appeals, there is an error apparent on the face of the record and also contended that each of the appellants are espousing their own cause and the petitioner has been defeated by adopting oppressive means and hence, the CLB ought to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and others) and sought for dismissal of the review petitions. 6. The Learned Senior Counsel Mr.T.K.Seshadri, representing Mr.T.K.Baskar, counsel for the Respondents 10 to 12 in Rev.A.No.94/2015/ Respondents 4 to 6 in Rev.A.No.95/2015, contended that there is no error apparent on the face of the record and hence the review petitions are not maintainable. The Learned Senior Counsel relied upon para 45 of the judgement reported in 2015 128 CLA 353 (SC) to contend that the deferment of the adjudication to a future point cannot constitute a question of law to be appealed therefrom. Since the CLB has held that the issue needs to be adjudicated at the final hearing after the counter of the parties are filed, there is no necessity to interfere. The Learned Senior Counsel also contended that the rights of the shareholders to vote cannot be ousted on technicalities and therefore, the orders of this Court does not require any reconsideration and sought for dismissal of the review petitions. 7. The Learned Counsel, Mr.R.Venkatavaradhan, appearing for the 1st respondent painstakingly contended that there is no error apparent on the face of the record. The Counsel also relied upon the fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts:- (1) Notwithstanding anything contained in this Act, the articles of a Company may provide that no member shall exercise any voting right in respect of any shares registered in his name on which any calls or other sums presently payable by him have not been paid, or in regard to which the Company has exercised any right of lien. (2) A Company shall not, except on the grounds specified in sub-section (1), prohibit any member from exercising his voting right on any other ground. (3) On a poll taken at a meeting of a Company, a member entitled to more than one vote, or his proxy, where allowed, or other person entitled to vote for him, as the case may be, need not, if he votes, use all his votes or cast in the same way all the votes he uses. Section 107:- Voting by show of hands:- (1) At any general meeting, a resolution put to the vote of the meeting shall, unless a poll is demanded under section 109 or the voting is carried out electronically, be decided on a show of hands. (2) A declaration by the Chairman of the meeting of the passing of a resolution or otherwise by show of hands under sub-section (1) and an entry to that effect in the bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b) may, in respect of any item of business, other than ordinary business and any business in respect of which Directors or auditors have a right to be heard at any meeting, transact by means of postal ballot,in such manner as may be prescribed, instead of transacting such business at a general meeting. (2) If a resolution is assented to by the requisite majority of the shareholders by meansof postal ballot, it shall be deemed to have been duly passed at a general meeting convened in that behalf. 11. Rule 20 of the Companies (Management and Administration) Rules as it stood before amendment reads as under:- 20. Voting through electronic means:- (1) Every listed Company or a Company having not less than one thousand shareholders, shall provide to its members facility to exercise their right to vote at general meetings by electronic means. Provided that the Company may provide the facility referred to in this sub rule on or before the 1st day of January 2015. (2) A member may exercise his right to vote at any general meeting by electronic means and Company may pass any resolution by electronic voting system in accordance with the provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at least once in a vernacular newspaper in the principal vernacular language of the district in which the registered office of the Company is situated, and having a wide circulation in that district, and at least once in English language in an English newspaper having a wide circulation in that district, about having sent the notice of the meeting and specifying therein, inter alia, the following matters, namely:- (a) statement that the business may be transacted by electronic voting; (b) the date of completion of sending of notices; (c) the date and time of commencement of voting through electronic means; (d) the date and time of end of voting through electronic means; (e) the statement that voting shall not be allowed beyond the said date and time; (f) website address of the Company and agency, if any, where notice of the meeting is displayed; and (g) contact details of the person responsible to address the grievances connected with the electronic voting; (vi) the e-voting shall remain open for not less than one day and not more than three days: Provided that in all such cases, such voting period shall be completed thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... solution shall be deemed to be passed on the date of the relevant general meeting of members. ' 12. The Learned Senior Counsel for the review petitioners has relied upon the following judgements. 13. In AIR 1961 SC 1633 (Commissioner of Income Tax, Bombay Vs. scindia Steam Navigation Co. Limited), the Honourable Supreme Court has held as under :- 10. On these provisions, the question that arises for decision is whether in a reference under section 66, the High Court can consider a question which had not been raised before the Tribunal and/or dealt with by it in its order even though it be one of law. On the answer to be given to it there has been a difference of opinion among the High Courts and that turns on the meaning to be given to the words, any question of law arising out of the order of the Tribunal. There is no pronouncement of this court which concludes this question, though there are decisions which afford guidance in the determination thereof. These decision will now be considered. 39. The result of the above discussion may thus be summed up : (1) When a question is raised before the Tribunal and is dealt with by it, it is clearly one aris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch cases that an inference from facts is a question of law. In this respect, mixed questions of law and fact differ from pure questions of fact in which the final determination equally with the finding or ascertainment of basic facts does not involve the application of any principle of law. The proposition that an inference from facts is one of law will be correct in its application to mixed questions of law and fact but not to pure questions of fact. The following observations of Lord Atkinson' in Herbert v. Samuel Fox and Co., Ltd.(1) clearly bring out the principle above stated: .... Your Lordships were pressed with the usual argument, that as the County Court judge though a judge of law and facts, is the sole judge of fact, his findings cannot be disturbed if there was any evidence before him upon which he, as a reasonable man, could find as he has found. That argument is quite sound if it be applied to pure findings of fact. It is utterly unsound if it be applied either to findings on, pure questions of law or on mixed questions of law and fact .... It is wholly illegitimate, in my view, in cases such as the present, by finding in the words of the statute to endeavo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be raised in a reference may turn out to be a pure question of fact and if that be so, the finding of fact recorded by the Appellate 'Tribunal must be regarded as conclusive in a proceeding under s. 66(1). But i would be open to challenge the conclusion of fact drawn by the Appellate Tribunal on the ground that it is not supported by any legal evidence or material or that the conclusion of fact drawn by the Appellate Tribunal 'is perverse and is not ration,ally possible. It is within these narrow limits that the conclusions of fact by the Appellate Tribunal can be challenged under s. 66(1). Such conclusions can never be challenged on the ground that they are based on misappreciation of evidence. There is, however, a third class of cases in which the assessee or the department may seek to challenge the correctness of the conclusion reached by the Tribunal on the ground that it is a conclusion on a question of mixed' law and fact. Such a conclusion is no doubt based upon the primary evidentiary facts, but its ultimate form is determined by the application of relevant legal principles. To put it differently, the proper construction of statutory language is always a mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect the real controversy between the parties. It is therefore, expedient in the interest of justice that the questions should be modified as suggested by the assessee Company in its .petition under s. 66(1) of the Act to the High Court and the Appellate Tribunal should be asked to make a fresh statement of the case. 16. In AIR 1964 SC 1372 (M/s.Thungabhadra Industries Limited Vs. The Government of Andhra Pradaesh), it has been held as under:- What, however, we are now concerned with is whether the statement in the order of September 1959 that the case did not involve any substantial question of law is an error apparent on the face of the record . The fact that on the earlier occasion the court held on an 'identical state of facts that a substantial question of law arose would not per se be conclusive, for the earlier order itself might be erroneous. Similarly, even if the statement was wrong, it would not follow that it was an error apparent on the face of the record , for there is a distinction which is real, though it might not always be capable of exposition, between a mere erroneous decision and a decision which could be characterised as vitiated by error appar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing their votes by postal ballot or by electronic voting, the later being either from a remote location or at the meeting itself. 18. In 2010 15 SCC 118 (Gian Singh Vs. State of Punjab and another), it has been held as under:- 7. We are of the opinion that the above three decisions require to be reconsidered as, in our opinion, something which cannot be done directly cannot be done indirectly. In our, prima facie, opinion, non compoundable offences cannot be permitted to be compounded by the court, whether directly or indirectly. Hence, the above three decisions do not appear to us to be correctly decided. 19. Per contra, the Learned Senior Counsel for the respondent has relied upon the following judgements 20. In AIR 1960 SC 137 (Satyanarayanan Laxminarayan Hedge and others Vs. Millikarjun Bhavanappa Tirumale), it has been held thus:- 18. ... If it is clear that the error if any is not apparent on the face of the record, it is not necessary for us to decide whether the conclusion of the Bombay High Court on the question of notice is correct or not. An error which has to be established by a long drawn process of reasoning on points where there may conceivabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estions of law is involved in this appeal. No substantial question of law is involved to entertain the CMA. 23. In 2012 108 CLA 25 Kar (D.Victor Samuel Vs. Pretechplast (P) Limited), it has been held as under:- 6. We have given careful consideration to the contention of the learned counsel for the Appellant and scrutinised the material on record. The appeal is filed against an interim order passed by the Company Law Board. The prayer that was sought for in the application and considered by the Company Law Board in the impugned order was to restrain holding of the meeting on 12.5.2011 and to prevent Respondents 2 and 3 from removing the Appellant from the Board of Directors of 1st Respondent Company under Section 284(3) of the Companies Act. It is well settled that this court in appeal, would be slow to interfere with the discretion exercised by the Company Law Board while granting or rejecting the interim application for directions, unless some exceptional ground is made out for interference. Having regard to the above said facts, we are of the opinion that no exceptional ground is made out and the Company Law Board has observed that convening of EGM and decision taken t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he recorded facts and the documents at a later stage. 25. In the present case, admittedly the contentions raised now were also raised earlier before this Court and also before the CLB. This court after considering the contentions, is of the view that the questions have already been answered in paragraphs 18,19,20 and 23 of the order dated 27.04.2015 which is extracted as under:- 18. Upon consideration of the grounds and the impugned order, this court is of the view that the questions that have been raised before this court are not purely questions of law, but are only mixed questions of law and fact, which cannot be entertained by this court. Even though, as per the judgement relied upon by the learned senior counsel for the appellants, a perverse finding or non-consideration of relevant documents can amount to question of law, this court is of view that there is no perversity in the impugned order of the Company Law Board and therefore, the appeals are not maintainable. The interim relief as sought in this case are in the nature of prohibitory and mandatory injunction for which the Petitioners must satisfy the mandatory tests of prima facie case, balance of convenience ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view may not justify interference with the trial court's exercise of discretion. After referring to these principles Gajendragadkar, J. in Printers (Mysore) Private Ltd. v. Pothan Joseph : These principles are well established, but as has been observed by Viscount Simon in Charles Osention Co. v. Johnston the law as to the reversal by a court of appeal of an order made by a judge below in the exercise of his discretion is well established, and any difficulty that arises is due only to the application of well settled principles in an individual case. 20. The grant of interim relief is only discretionary. Hence, sitting in appeal, this court is not inclined to interfere with the impugned order of the Company Law Board. The appellants have alleged various acts of oppression and mismanagement. Necessarily, the Company Law Board Board will have to go into the same at the time of final hearing. 23. In the facts of the case, whether the proceedings held on Annual General meeting on 26.09.2014 is as per law and the implication of the same with regard to allegations of oppression and mismanagement and whether the acts complained constitute independent acts of oppres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings. Therefore, in the circumstances narrated above, it is only a mixed question of fact and law. It is the main relief and it cannot be isolated from the questions of facts as indicated above and decided at the introductory stage. 28. The judgements relied upon by the Learned Senior Counsel for the Appellants, clearly lay down the propositions regarding the question of law and the question of fact. What emerges is that when a question of construction of a provision is raised, it is a pure question of law. Also, the facts have to be applied to give a finding on the question of law. The Judgements are not relevant at this stage because, what was under appeal before this court is the order of refusal by the CLB, exercising its discretionary relief by giving specific findings. As held by the Various Courts and also by this Court, the scope for interference in the matter of discretionary reliefs is very limited and this court has already rendered its findings. Error if any has to be established by long drawn process, then the error is not an error apparent on record. In order to interfere with the orders of the CLB, the order must be perverse or a patent error in fundamental princ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e grievance is not just the elections. Again considering all these aspects only, this court in a nutshell held that there is no perversity in the findings of the CLB and the questions raised are not pure questions of law. Hence, there is no error apparent on the face of the record, warranting interference. 31. In so far as oppression is concerned, any decision on the same can be arrived at only if the other questions are decided. On the face of it, the 7th respondent has been permitted to participate in the elections and his family members have been permitted to vote. Therefore, again mindful of the prejudice, that may be caused before the CLB, this court held in para 23 that the same would have to be decided by the CLB during the final hearing. 32. The CLB has exercised its discretion against the appellants after giving reasons. Even if prima facie case, regarding a question of law is made out, the interim relief can be denied. All the tests required for grant of interim relief must be satisfied. This court has already given its findings in Paragraphs 18 and 19. It is pertinent to mention here that this Court has only held that no pure question of law have been raised. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainable:- (i) A repetition of old and overruled argument is not enough to reopen concluded adjudications. (ii). Minor mistakes of inconsequential import. (iii). Review proceedings cannot be equated with the original hearing of the case. (iv). Review is not maintainable, unless the material error, manifest on the face of the order, undermine its soundness or results in miscarriage of justice. (v). A review is by no means an appeal in disguise whereby an erroneous decision is re-heard and corrected but lies only for patent error. (vi). The mere possibility of two views on the subject cannot be a ground for review. (vii). The error apparent on the face of the record should not be an error which has to be fished out and searched. (viii). The appreciation of evidence on record is fully within the domain of the appellate Court, it cannot be permitted to be advanced in the review petition. (ix). Review is not maintainable when the same relief sought at the time of arguing the main matter had been negatived. 34. On consideration of facts, no new grounds have been made out and the points agitated were already negated by th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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