TMI Blog1983 (3) TMI 309X X X X Extracts X X X X X X X X Extracts X X X X ..... ors and Shanti Parkash Malik was re-elected as Chairman of the company. The cinema of the company was being run by M/s Golden Movies, M/s Sheet Pictures and M/s Haneet Films Exchange upto 27th March, 1975, and some other firms for subsequent period. Smt. Harmohinder Kaur is the wife and Jasmeen Chug Saveen Chug and Paveen Gyani are the daughters of Gurdeep Singh, and Smt. Inderjeet Kaur is the wife of Daljit Singh Gurdeep Singh, Daljit Singh, Smt Harmohinder Kaur, Smt. Inderjeet Kaur and Miss Jasmeen Chug were directly or indirectly interested in the theatre hire agreements with M/s Harneet Film Exchange but they did not disclose their direct or indirect interest in the meeting of the Board of Directors on 16th September. 1974. As such, due to contravention of the provisions of Section 299 of the Companies Act (hereinafter called the Act), their offices stood automatically vacated from 16th September, 1974, onwards. 3. Rakesh Malik Petitioner and Ors. filed suit No. 336 of 1976 in the Court of the Subordinate Judge, Rohtak, after they came to know about the above-said facts against Gurdeep Singh, Daljit Singh, Smt Harmohinder Kaur and some others on 31st July, 1976, claiming a d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eased to be members of the company and also its Directors Consequently, they Sled a suit in the Court of Senior Subordinate Judge, Rohtak, praying that a decree for permanent injunction restraining Gurdeep Singh, Smt. Harmohinder Kaur, Daljit Singh, Smt. Inderjeet Kaur, Miss Jasmeen Chug and the company, Defendants, from holding meetings or election of the office bearer of the company without inviting the Petitioners and permitting them to participate in such meetings be granted They further prayed the above persons be restrained from acting as. Directors of the company. 8. In the written statement, it is averred, the allegations of the Petitioners were controverted by the said defendants The inter alia pleaded that Gurdeep Singh, Daljit Singh, Smt. Inderjeet Kaur, Smt. Harmohinder Kaur and Ors. had been elected as Directors, and that the Petitioners had sold their shares of the company and, therefore, they had not been invited to attend the meeting held on 2nd January, 1977. 9. In view of the written statement, the Petitioners filed another suit on 2nd February, 1977, seeking a declaration to tie effect that the proceedings dated 2nd January. 1977, of the extraordinary gener ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l for the Petitioners agreed that he had no objection if the Respondents were allowed to raise the question at the time of arguments even in the absence of plea. In view of the aforesaid statement, the Respondents were allowed to argue on this question in the first instance and it is being decided as a preliminary issue. 15. The contention of the Learned Counsel for the Respondents is that the petition contains various questions of law and fact which cannot be decided in summary proceedings under Section 155 of the Act. He urges that the proper remedy for the Petitioners is to get the matter decided from a Civil Court. 16. On the other hand, Mr. Chanchil Singh, counsel for the Petitioners, has strenuously urged that the question involved is whether the Respondents transferred the shares in breach of the provisions objection 108 of the Act and to decide that question, the proper forum is the High Court. 17. I have heard the Learned Counsel at a considerable length and given my thoughtful consideration to their arguments. Section 155 inter alia provides that if the name of any person is, without sufficient cause, entered in the register of members of a company, or after havi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Supreme Court in Public Passenger Service Ltd. Chidambaram v. M.A. Khadar A.I.R. 1966 S.C. 489. R.S. Bachawat, J., speaking for the Court, held that where by reason of its complexity or otherwise the matter can more conveniently be decided in a suit, the Court may refuse relief under Section 155 in exercise of the desoretionary jurisdiction and relegate the parties to a suit. 18. It is not necessary to multiply the authorities at it is n w well-settled that the scope of Section 155 is restricted and the proceedings thereunder are of a summary nature. If the care involves complicated questions, the proper course is to direct the parties to have recourse to a suit. 19. Mr. Chanchll Singh made a reference to People's Insurance Company Ltd. v. M/s C. R E Wood and Company Ltd A.I.R. 1960 P H. 388, Mannalal Khetan etc v. Kedar Natk Khetan A.I.R. 1977 S.C. 536 and Shrl Gulabrai Kalidas Naik end others v. Shri Laxmidas Lallubhai Patel of Bareda (1979) 48 Comp. Case 438. People's Insurance Company Ltd's case (supra), was also decided by Tek Chand J. Who, after referring to his earlier judgment in S. Bhagat Singh's case (supra) and some other cases, said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lready taken cognizant e of this matter and the suit is still pending. The decision in that suit shall be bidding on the parties 21. Even otherwise, after going through the facts of the case, it is evident that several controversies arise in it which require detailed investigation. It may be highlighted that the Petitioners have alleged that Shri Gurdeep Singh, Shri Daljit Singh, Smt. Inderjit Kaur, Smt. Harmohinder Kaur and Miss Jasmeen, Directors, ceased to be so as they violated the provisions of Section 299 of the Act. Thereafter, a meeting was convened by Ashok Malik and Kamla Malik Directors of the Company, for 3rd July, 1976, to fill up the vacancies on account of the vacation of office by the above said Directors and Smt. Krishna Devi, Anil Malik and Rakesh Malik were unanimously appointed as Directors. Thus, there came into existence two Boards of Directors. The shares were transferred by the Board in which Sh. Gurdeep Singh etc. were the Directors. The Petitioners have challenged the transfer of shares Inter alia on the ground that the meeting of the Board of Directors had not been convened by the persons legally entitled to convene the same. Therefore, for deciding th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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