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of <h1>Court Rejects Applications for Lack of Jurisdiction and Merits</h1> <h3>RH. Patel Versus Reliance Industries Ltd.</h3> The court rejected both applications due to lack of territorial jurisdiction and on merits. It held that the issues raised did not fall within the ... Whether the new sovereign had waived his rights to ignore the rights given under the laws of the former sovereign? Held that:- There is also no dispute about the proposition that under sections 391 to 394 of the Companies Act, 1956, the court has ample power and jurisdiction to supervise the scheme as sanctioned under the Companies Act, 1956. However, such power in jurisdiction must be exercised keeping in mind the essential perquisites of the said sections. The court will have to act within the parameters laid down in these sections. Every grievance raised by the affected party cannot be raised nor can it be entertained by the court while exercising the powers thereunder. The applicants fail to satisfy the court that the issues raised by them squarely fall within the parameters of section 392 of the Act. Even otherwise, it is accepted for the sake of argument that it falls within such parameters, once IPCL is already dissolved, the appropriate court is the Bombay High Court to consider and decide such issues, in view of the provisions of section 2(11) read with sections 10 and 392 of the Companies Act, 1956 and hence, in any case, all these issues which are raised by the applicants cannot be and should not be allowed by this court, in their favour. Considering the foregoing discussion and taking overall view of the matter and keeping in mind the statutory provisions and the judicial precedents, the court is of the firm view that both these applications deserve to be rejected both on the ground of jurisdiction as well as on merits. Issues Involved:1. Territorial Jurisdiction2. Delay and Laches3. Modification of Scheme under Section 3924. Transfer of Undertaking (Appointed Date vs. Effective Date)5. Disinvestment Policy and Shareholders' Agreement6. Specific Performance of Contract of Personal ServiceIssue-wise Detailed Analysis:1. Territorial Jurisdiction:The court examined whether it had jurisdiction to entertain applications against Reliance Industries Ltd. (RIL) after the dissolution of Indian Petrochemicals Co. Ltd. (IPCL). The court noted that, according to Section 2(11) and Section 10 of the Companies Act, 1956, the appropriate jurisdiction lies with the Bombay High Court, where RIL's registered office is situated. The court held that it lacked territorial jurisdiction to entertain the applications.2. Delay and Laches:The court addressed the issue of delay in filing the applications. The office memorandum reducing the superannuation age from 60 to 58 years was issued on March 8, 2007, and communicated to all supervisory employees. The applicants, aware of this memorandum, did not raise objections during the sanctioning of the scheme or immediately thereafter. The court found that the applications, filed in 2009, were barred by delay, laches, and acquiescence.3. Modification of Scheme under Section 392:The court considered whether it could modify the scheme under Section 392 of the Companies Act. It emphasized that Section 392 allows the court to supervise and ensure the proper working of a compromise or arrangement but does not extend to adjudicating disputes or claims arising from the scheme. The court concluded that the relief sought by the applicants, including quashing the office memorandum, did not fall within the ambit of Section 392.4. Transfer of Undertaking (Appointed Date vs. Effective Date):The court analyzed the significance of the appointed date (April 1, 2006) and the effective date (September 5, 2007) in the scheme of amalgamation. It held that while the appointed date was relevant for accounting purposes, the actual transfer of employees occurred on the effective date. Thus, the superannuation age of 58 years, as per the office memorandum dated March 8, 2007, was applicable on the effective date.5. Disinvestment Policy and Shareholders' Agreement:The applicants argued that the reduction in superannuation age violated the disinvestment policy and shareholders' agreement. The court found no provision in the scheme requiring preservation of service conditions as of the disinvestment policy date. It held that any breach of the disinvestment policy or shareholders' agreement was a disputed fact not within the scope of Section 392 proceedings.6. Specific Performance of Contract of Personal Service:The court reiterated that contracts of personal service cannot be specifically enforced, as per Section 14 of the Specific Relief Act, 1963. The applicants, being supervisory employees and not workmen, could not seek reinstatement or continuation of service through specific performance. Their remedy, if any, lay in claiming damages for breach of contract.Conclusion:The court rejected both applications on the grounds of lack of territorial jurisdiction and on merits. It held that the issues raised by the applicants did not fall within the parameters of Section 392 of the Companies Act and that any grievances should be addressed by the Bombay High Court.
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