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Mr. Ravi Rajnish and Mrs. Archana Rajnish Versus M/s. Jain Link Private Limited and Others

2016 (4) TMI 91 - COMPANY LAW BOARD KOLKATA

Demurrer application - Held that:- As the issue of maintainability involves the mixed question of law and facts. Therefore, in the interest of justice, the prayers made in the instant Company Application are partly allowed to the extent that the demurrer application be heard and decided first and for this purpose, the Respondents Advocate is hereby directed to file the reply to the Company Petition within 3 weeks and rejoinder, if any, be filed by the Petitioners Advocate within 2 weeks from the .....

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ala Bansal, Advocate ORDER In this case, the Petitioners filed a Company Petition being C.P. No. 151/2015 under Sections 397, 398, 399, 402, 403 & 406 of the Companies Act, 1956 and Sections 58 & 59 of the Companies Act, 2013, alleging the acts of oppression and mis-management in the affairs of the Respondent Company, which is pending for adjudication. In the meantime, the Respondents Advocate moved an Company Application bearing C.A. No. 1366/2015, praying for stay of the operation of t .....

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tions were given for filing of the reply in the main Company Petition. It has also been averred that in an earlier proceeding being C.P. No. 686/2010 in connection with the Respondent Company, the Petitioners/Non-Applicants, on the self same cause of action, had filed a Company Application being C.A. No.46/2011 seeking addition of the Petitioners/Non-Applicants as parties, but in a period of four years, the Petitioners/Non-Applicants could not establish themselves as shareholders of the Responde .....

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ted that it is settled law that when an issue as to the maintainability of a Petition is raised, the same should be decided first without going into the merits of the matter. Also, the question regarding the jurisdiction of a Court has to be decided first and not at the time of hearing of the matter on merits. It has also been contended that as the Respondents/Applicants has filed a Company Application being CA. No. 1231/2015 praying for dismissal of the main Company Petition, inter alia, challe .....

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tten statement is not sustainable in law. As such, this Hon'ble Board has the jurisdiction to hear out the application for dismissal as a preliminary issue before entering into the merits of the matter. 2. As recorded in the Order dated 03.09.2015, the Petitioners/Non-Applicants Advocate stated that he does not wish to file any reply in CA. No. 1366/2015 and hence, no rejoinder was required to be filed by the Respondents/Applicants Advocate. 3. The Petitioners/Non-Applicants Advocate argued .....

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e main Company Petition, it is now not open to the Respondents (Applicants herein) to contend that they need not file reply to the main Company Petition. In addition, the issue as to whether the reply to the Company Petition has to be filed or not, has become irrelevant since the last chance to file such reply has also come to an end, even before filing of the instant Company Application. Therefore, the Respondents (Applicants herein) do not have any right to file reply and nothing surfaced in t .....

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ion, the directions given for filing of the reply in the main Company Petition are wholly without jurisdiction which cannot be cured by the appearance of the parties in the proceedings, even if that is without protest because it is well settled that consent cannot confer jurisdiction Waverly Jute Mills -vs-. Raymon & Co. [AIR (1963) SC 90 (5 Bench)]. Further, as none of the Petitioners/Non-Applicants is the members of the Respondent Company, the question of the Company Law Board exercising a .....

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does not have to plead and prove locus standi. However, the provisions of Section 399 of the Act mandate pleading and proof regarding the locus standi of the Petitioner to maintain an Application under Section 397/398 of the Act. As such, the onus on the part of the Petitioners in C.P. No. 151/2015 is more than that of an ordinary plaintiff. Besides, the Petitioners in C.P. No. 151/2015 could not show any principle of law to the contrary. 4.1 The Respondents/Applicants Advocate, in support of hi .....

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on the Company Law Board, Kolkata Bench to decide on the issue raised in the demurrer application without going into the merits of the matter. (c) Saleem Bhai & Ors. -vs- State of Maharashtra & Ors. [2003] 1 SCC 557, wherein the Hon'ble Supreme Court has held "while deciding an Application under Order VII Rule 11 of the Code of Civil Procedure, direction given by the Court to file Written Statement is not in accordance with law. (d) Sushil Kumar Mehta -vs- Cobind Ram Bohra [1990 .....

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l parties, it is observed that the Company Petition is a composite petition under Sections 397, 398, 399, 402, 403 & 406 of the Companies Act, 1956 as well as Sections 58 & 59 of the Companies Act, 2013. Therefore, the issue of maintainability of the Company Petition entails the mixed question of law under Section 399 of the Companies Act, 1956 and the facts as to the "Nil" shareholding of the Petitioners and hence, it is imperative that all the relevant facts as to the allegat .....

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e into. However, this does not imply that the Order passed by the Court for completion of the pleadings in the form of reply and rejoinder well before filing the Demurrer Application, will not be complied with especially when there is involvement of question of law and facts. 5.1 Under the aforesaid facts and circumstances, it is clear beyond doubt that there was no Company Application challenging the maintainability of the main Company Petition on 07.07.2015 and hence, after hearing the submiss .....

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he request of the Respondents Advocate, further 10 days' time was allowed to file the reply and rejoinder was to be filed within 3 days from the date of receipt of the reply. In view of this, the Respondents Advocate is required to ensure compliance of the Orders dated 07.07.2015 and 17.08.2015 in letter and spirit. Moreover, the Petitioners Advocate has levelled the allegation that the Respondent No. l Company has illegally showed the shareholding of the Petitioners as "Nil". Thus .....

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