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TMI Blog2016 (10) TMI 1320X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel appearing for the appellants has pointed out that the learned Judge has misconstrued the provisions of Section 10GB of the Companies Act, 1956 to come to the conclusion that the jurisdiction of the Civil Court is barred. The learned Senior Counsel further pointed out that the suit filed by the Company as well as two directors of the Company is on the ground that there was a fraud committed by the respondent no.1 whilst running the affairs of the plaintiff no.1/Company. It is further pointed out that documents were not available but however documents were fabricated to defraud. Accordingly, the following reliefs were sought. (a) For a decree and order of this Hon'ble Court declaring that Form No.5 filed by the defendant no.1 at annexure-Q before the Registrar of Companies, purporting to be the Share Capital from 51% to 70% as null and void and/or inoperative and order, it to be cancelled. (b) For a Judgment and decree declaring that Form No.32 filed at Annexure-T and Annexure- U by the defendant no.1, before the Registrar of Companies, purporting to intimate the Registrar of Companies, that plaintiffs no.2 and 3 resigned as Directors and purporting to appoint defendan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irectors of the Company. It is the contention of the appellants that the plaintiff no. 2 has blood relationship with the Respondent no. 1 and that he had issued a General Power of Attorney which has been misused. It is also contended that the Respondent no.1 represented to the Appellant no.2 that the Company required money to complete the project as there was good demand for Block A. The main contention prima facie is to claim that there was mistrust and misuse of the authority by the Respondent no.1. Looking into the allegations in the plaint, the reliance to the provisions of the Companies Act and the judgment in the case of V. S. Krishnan & Ors ( supra ) is not applicable to the facts of the present case. The exclusion of jurisdiction cannot be readily inferred. Section 10GB has been inserted by the Companies (Second Amendment) Act, 2002 in order to provide for two main matters. One of them is that no Civil Court is to have any jurisdiction to entertain any suit or proceeding in respect of any matter vested in the Tribunal or Appellate Tribunal for its determination. The second is that no injunction is to be granted by any Court or other authority in respect of any action taken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said statute or not. (3) x x x x x x (4) x x x x x x (5) Where the particular Act contains no machinery for refund of tax collected in excess of constitutional limits or illegally collected, a suit lies. (6) Questions of the correctness of the assessment apart from its constitutionality are for the decision of the authorities and a civil suit does not lie if the orders of the authorities are declared to be final or there is an express prohibition in the particular Act. In either case the scheme of the particular Act must be examined because it is a relevant enquiry. (7) An exclusion of jurisdiction of the civil court is not readily to be inferred unless the conditions above set down apply. 8. In Santosh Poddars case (supra), the Division Bench of this court was dealing with a suit where the plaintiffs had prayed for a declaration that defendant 1 therein had ceased to be a director of Poddar Tyres Limited, defendant 3 therein, with effect from 31/12/1990. They sought a further declaration that all meetings of the Board of Directors of defendant 3 company held after 31/12/1990 and in particular, the meetings allegedly held on 23/3/1991 and 10/6/1991 are illegal, inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that whenever the term the court is used in any section of the Companies Act, the term Court will have to be interpreted with reference to section 10. These sections will have no application where any general civil suit is filed. The definition clause is attracted only when resort is had to a proceeding under the Companies Act under a section which prescribes resort to a Court. Under the Companies act, powers are conferred not only on Courts but also on other authorities like the Company Law Board, the Central Government and the Registrar. Where a power is vested by the Act in a Court, that Court has to be ascertained with reference to section 10. Beyond so specifying the Court competent to deal with such a matter, section 10 cannot be construed as investing the Company Court with jurisdiction over every matter which may arise in respect of a Company or as divesting Civil Courts of their jurisdiction." 10. The trial court has placed reliance on this judgment and I find the reliance placed on this judgment to be apt. It is pertinent to note that in that case also, the declaration was sought that all meetings of the Board of Directors of defendant 3 company and the resolutions pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ight of a shareholder to seek rectification of the register of members, and the jurisdiction of the civil court in appropriate cases is not barred where complicated questions of law and fact arise in an application for rectification under section 155 of the said Act and it is not possible for the court to grant relief without first adjudicating the disputed questions of law and fact. Relying on these observations, it was urged by the learned counsel for the petitioners that the plaintiffs have to first go to the Company Law Board and if the Company Law Board comes to the conclusion that disputed questions of law and facts arise then the Company Law Board can relegate the plaintiffs to the civil court." 12. Looking into the observations made in the said Judgment based on the Judgment of the Division Bench of this Court and the allegations made in the plaint, we find that the learned Trial Judge was not justified to come to the conclusion that the suit is barred in terms of Order 7 Rule 11 of the Civil Procedure Code. The jurisdiction of the Civil Court is not barred taking into account the relief sought by the Appellants which, prima facie, suggests that they are under the general ..... X X X X Extracts X X X X X X X X Extracts X X X X
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