Inherent procedural powers do not create substantive jurisdiction, but court supervision may guide interim management in company disputes.

Rule 9 of the Companies (Court) Rules is only a procedural reservoir of inherent power and does not by itself confer substantive jurisdiction, while Section 151 of the Code of Civil Procedure cannot be used to create a fresh source of authority or affect substantive rights. The note also states that, where interim management has been appointed in oppression and mismanagement proceedings under Sections 397, 398 and 402 of the Companies Act, 1956, the Court may issue directions needed for effective supervision and to resolve practical administrative difficulties arising under its earlier relief.

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Issues: (i) Whether the application for directions was maintainable under Rule 9 of the Companies (Court) Rules and Section 151 of the Code of Civil Procedure, 1908. (ii) Whether, in proceedings under Sections 397, 398 and 402 of the Companies Act, 1956, the Court had supervisory power to issue directions to the interim management of the company.

Issue (i): Whether the application for directions was maintainable under Rule 9 of the Companies (Court) Rules and Section 151 of the Code of Civil Procedure, 1908.

Analysis: Rule 9 is only a procedural provision preserving the Court's inherent powers and does not itself confer substantive jurisdiction. Section 151 of the Code of Civil Procedure, 1908 is confined to procedural powers and cannot be used to affect substantive rights or create a fresh source of authority for granting the relief sought. The application was therefore not maintainable under either provision.

Conclusion: The objection to maintainability under Rule 9 of the Companies (Court) Rules and Section 151 of the Code of Civil Procedure, 1908 succeeded.

Issue (ii): Whether, in proceedings under Sections 397, 398 and 402 of the Companies Act, 1956, the Court had supervisory power to issue directions to the interim management of the company.

Analysis: Relief had already been granted under Sections 397, 398 and 402 of the Companies Act, 1956, and the interim board was functioning under the Court's supervision until further orders. In such a setting, the Court retained authority to guide the interim management and resolve practical difficulties arising in the administration of the company. The supervisory order would be frustrated if the Court could not issue necessary directions to protect the purpose of the relief already granted.

Conclusion: The Court had competence to issue directions and instructions to the interim management under its supervisory powers.

Final Conclusion: The application was sustained on the basis of the Court's supervisory authority over the interim management, and the requested corporate resolution was approved.

Ratio Decidendi: In proceedings for oppression and mismanagement, where the Court has appointed interim management under Sections 397, 398 and 402 of the Companies Act, 1956, it may issue directions necessary for effective supervision of the company, but procedural provisions and inherent powers under the Code of Civil Procedure cannot themselves confer substantive jurisdiction.

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