TaxTMI 
TaxTMI 
TaxTMI 
1994 (9) TMI 235
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....tive industrial laminates. The company went for public issue of 23,65,000 equity shares of which 4 lakhs equity shares have been reserved for the NRIs of Rs. 10 each for cash at par aggregating to Rs. 236.50 lakhs. The company made applications to the Ahmedabad Stock Exchange and the Bombay Stock Exchange for per-mission to deal in and for an official quotation of the equity shares being offered in terms of its prospectus dated 10-8-1993. The company has filed a copy of its prospectus under section 60 of the Companies Act, 1956 ('the Act') with Registrar of Companies, Gujarat for registration. The issue opened on 9-9-1993. It was oversubscribed. Therefore, it was closed on 14-9-1993 being the earliest closing date. The latest closing date an-nounced in the prospectus was 20-9-1993. Hereafter strange happenings take place. A group of persons, Viren Thakkar and his associates seem to have entered into large scale out of the ring transactions in the sale arid purchase of company shares. On that account, they would be required to make good their speculative losses once the company shares are listed and traded in the market. To delay this the first suit C.S. No. 90 of 1993, was filed a....
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....plication for interim relief was directed to be posted on 18-12-1993. After midnight of 17/18-12-1993 Rashmin Ghadiya, who is stated to be a relative of the said Viren Thakkar filed a plaint through the Advocate, Mr. Tarun V. Shah before the Civil Judge (J.D.) at Prantij for a declaration that the company's issue was void since the requisite permission of stock exchange under section 73 of the Act was not obtained. An application for interim injunction restraining the company, the stock exchanges at Ahmedabad, Jaipur, Bombay, Rajkot Shareholders Association and Rajkot Share Dealers Association from issuing transferring, selling or dealing in any manner equity shares of the company and restraining the company from utilising the funds of the public issue in any manner till the disposal of the suit. On this day (18-12-1993), the Morvi Court dismissed the application for interim relief for default. However, Mr. Tarun V. Shah applied for resto-ration on the ground that he was delayed in reaching the Court on account of the farmers' agitation. That application stood adjourned to 20-1-1994. On 20-12-1993, it appears that the learned Judge of the High Court who was dealing with Special ....
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.... propriety and the correctness of these interim orders civil appeal arising out of SLP (C) No. 878 of 1994 against the judgment dated 9-1-1994 by the City Civil Judge (Senior Division), Baroda in Special Civil Suit No. 25 of 1984 and civil appeal arising out of SLP(C) No. 874 of 1994 passed by the City Civil Judge, Ahmedabad in C.S. No. 6683 of 1993 have come to be preferred. 10. T.P. Nos. 26 to 30 of 1984 have been filed for transferring Special Civil Suit No. 90 of 1993, Civil Suit Nos. 6630 and 6683 of 1993, Civil Suit No. 85 of 1993 and Special Civil Suit No. 25 of 1994 to the High Court of Gujarat at Ahmedabad or in the alternative for an order for transferring the said suits pending at Morvi, Prantij and Baroda to the City Civil Court at Ahmedabad. 11. The learned counsel for the appellant vehemently argues that all the suits and the writ petition are frivolous and vexatious in nature. They have been restored to by a caucus of individuals with a view to defeat or delay their liability in illegal speculative transactions in the shares of the company. They are determined to see the company shares are not dealt in Ahmedabad and Bombay exchanges or no quotations for them are av....
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....ld complete without any further delay the formalities mentioned in the enclosure to their earlier letter dated 27-9-1993. An affidavit Exh. 48 dated 8-1-1994 has been filed in the said Civil Suit No. 6683 of 1993 of J.J. Bhat, Joint General Manager of the Bombay Stock Exchange stating inter alia, that the stock exchange took a decision to approve the listing application seeking permission for the equity shares of the company to be dealt with on the stock exchange and that the stock exchange accordingly wrote a letter dated 23-11-1993 to the company informing the letter of the said decision, that earlier the stock exchange had written a letter dated 27-9-1993 to the company enclosing therewith the list of formalities to be completed by the appellant. 15. Even as a question of law in order to comply with the requirements of section 73, the annual listing is not required. By resorting to successive suits and obtaining the impugned interim orders the respondents have caused immense damage to the appellant and there by prevented the appellant-company the recovery of further call money which comes to about Rs. 63 lakhs. Therefore, this clear case in which this Court should award heavy ....
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....d it seems to us to be the only possible view to take. Any other view would make the rule futile. The words 'new case' have been understood to mean 'new set of ideas': Dornan v. J.W. Ellis & Co. Ltd [1962] 1 All ER 303. This also seems to us to be a reasonable view to take. No amendment will be allowed to introduce a new set of ideas to the prejudice of any right acquired by any party by lapse of time." (p. 98) If the matter is viewed as a contract no part of cause of action has arisen within the jurisdiction of Morvi Court. The same principle will be applicable to the suit before the Civil Court (Senior Division), Baroda; more so, in the light of Explanation to section 20 of the Act, the appellant-company having its registered office in Ahmedabad. Therefore, we could expect the Court to examine these aspects before granting an interim order. So much for cause of action. 18. The grevamen of charge by the plaintiffs in various suits and the writ petition before the High Court was that Ahmedabad and Bombay Stock Exchanges mentioned in the prospectus of the appellant-company have not granted permission for the shares or debentures to be dealt with in Stock Exchange as contemplated u....
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.... defendant No. 3 wrote to defendant No. 5 and informed them that the basis of allotment was approved by the Ahmedabad Stock Exchange and conveyed no objection of the Ahmedabad Stock Exchange for utilisation of issue funds." 21. This is besides the following letter dated 7-1-1994: "The Director, Bloom Dekor Ltd., 1/F, Dhanlaxmi Chambers, Ashram Road, Ahmedabad-380009. Sub: Listing of equity shares of your company on our Stock Exchange Dear Sir, We are in receipt of your letter dated 31-12-1993 along with the enclosure and wish to inform you that the stock exchange is pleased to approve your application seeking permission for the above referred equity shares to be dealt in on the exchange and to grant such permission under section 73 of the Companies Act, 1956 with effect from 22-11-1993 and that members of our stock exchange have been allowed to deal in equity shares of your company with effect from 10-1-1994 in the market unit of trading of 100 shares. Kindly acknowledge the receipt. Thank you, Yours faithfully, For, The Stock Exchange, Sd/- (K.K.Mishra) Company Secretary" 22. Similarly, Jagdish Jayashankar Bhatt, Joint General Manager of the Stock Exchange, Bombay....
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....ompany is situate. Courts outside the place where the registered office is located, if approached, must have regard to the following: Invariably, suits are filed seeking to injunct either the allotment of shares or the meetings of the Board of Directors or again the meeting of general body. The Court is approached at the last minute. Could injunction be granted even without notice to the respondent which will cause immense hardship and administrative inconvenience? It may be sometimes difficult even to undo the damage by such an interim order. Therefore, the Court must ensure that the plaintiff comes to Court well in time so that notice may be served on the defendant and he may have his say before any interim order is passed. The reasons set out in the preceding paragraphs of our judgment in relation to the fact which should weigh with the Court in the grant of ex parte injunction and the rulings of this Court must be borne in mind." (p. 37) 26. It is not difficult to perceive that all these actions are nothing but attempts by one caucus of persons to bulk the appellant-company from issuing or dealing with shares or debentures; the plaintiffs or the petitioner in the writ petitio....