2017 (1) TMI 124 - HC - Companies Law

Dismissed appeal due to time bar under Companies Act 1956; Court highlighted statutory time limits

Narmada E. Learning Pvt. Ltd. (Earlier Known as Narmada Prakashan Pvt. Ltd.), Narmada Appliances Pvt. Ltd., Narmada Publishing House (India) Pvt. Ltd., Keyscrip Investment and Trading Pvt. Ltd., Uptrend Securities Pvt. Ltd., Saptarung Securities Pvt. Ltd. Versus Umang Boards Pvt. Ltd. & Ors, Anup Dhanuka, Alok Dhanuka, Shubh Karan Dhanuka, Bhagwati Devi Dhanuka, Suresh Gaggar, Anil Kumar L. Jain, Suman A. Jain, Basanti Devi L. Jain, Anil Laxmi Lal Jain, Ashok Kumar B. Jain

The appeal was dismissed as time-barred against the 10.03.2015 order due to exceeding the 120-day limit under Section 10-F of the Companies Act 1956. The ... Maintainability of appeal - Limitation period under Section 10-F - Special provision for limitation for filing an appeal against the orders of the Company Law Board - Held that:- The order dated 04.03.2016 passed on petitioner’s application purporting to be one under Section 151, 152 CPC read with Regulations 44, 45, 46 before the Company Law Board cannot be said to entail merger of the order dated 10.03.2015 therein, for time beginning to run for filing an appeal qua the Company Law Board’s order dated 10.03.2015. The doctrine of merger applies to appeals not to application of varied kinds filed in respect of orders. For the aforesaid reasons, I am of the considered view that this appeal against order dated 10.03.2015 filed on 13.05.2016 is wholly beyond the prescribed limitation and cannot be entertained to that extent. Regulations 44 is in the nature of inherent power of the Company Law Board a la Section 151 CPC. It cannot possibly be argued that the inherent powers of the Company Law Board empower it to reconsider on merits its own order. The application under Section 151, 152 CPC read with Regulation 44, 45, 46 seeking reconsideration of the order dated 10.03.2015 has therefore rightly been dismissed by the Company Law Board which is not vested with the power of review of its orders. The said application despite its camouflage was not maintainable. Even otherwise the jurisdiction of this Court under Section 10-F of the Act of 1956 can only be exercised where a question of law arises from the impugned order challenged in appeal. And no question of law even remotely arises from the order dated 04.03.2016 nor was even so argued. Issues:Appeal under Section 10-F of the Companies Act 1956 against orders dated 10.03.2015 and 04.03.2016 passed by the Company Law Board.Analysis:The appeal involved a company petition under various sections against alleged operation and mismanagement by majority shareholders. The Company Law Board, through an interim order on 10.03.2015, struck off certain reliefs sought by the petitioners. A subsequent application under Section 151/152 CPC was dismissed on 04.03.2016 as it was deemed a review of the earlier order, which the Board lacked the power to entertain. The respondent argued the appeal was time-barred, as per Section 10-F, with a 120-day limit for filing appeals. The appeal was filed on 13.05.2016, beyond the statutory limit, precluding any condonation of delay under the Limitation Act 1963. The appellant contended that the order dated 10.03.2015 merged with the one on 04.03.2016, allowing the appeal within the time limit. However, the Court found the appeal against the 10.03.2015 order was time-barred, as the doctrine of merger did not apply to varied applications filed concerning orders.The Court analyzed Section 10-F, emphasizing the 120-day limit for filing appeals against Company Law Board orders. It noted that the Limitation Act 1963 was excluded, and the appeal filed on 13.05.2016 was beyond the prescribed time limit. The Court clarified that the doctrine of merger applied to appeals, not to applications of different kinds concerning orders. The appeal against the 10.03.2015 order was thus considered time-barred and not entertainable. As for the 04.03.2016 order, the Court examined Regulations 44, 45, 46 of the Company Law Board Regulations 1991. It highlighted that these regulations did not grant the Board the power to review its own orders but allowed for corrections of clerical errors or amendments in proceedings. The Board's power to review was explicitly excluded by an amendment in 1992. The Court concluded that the application under Section 151, 152 CPC seeking reconsideration of the 10.03.2015 order was rightly dismissed, as the Board lacked the power to review its orders. Moreover, the appeal did not present any question of law from the 04.03.2016 order, leading to its dismissal.In summary, the appeal was dismissed due to being time-barred against the 10.03.2015 order, and the application under Section 151, 152 CPC was rightly rejected as the Board lacked review powers. The Court emphasized the statutory time limit for appeals and the limitations on the Board's authority to review its orders.