TaxTMI 
TaxTMI 
2018 (7) TMI 870
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....kram Bakshi were appointed as additional directors of respondent No. 3 Company. 3. Disputes arose between the parties. Mrs. Sonia Khosla wife of the appellant filed a petition under Sections 397 and 398 of the Companies Act, 1956 before the Company Law Board (CLB). The allegation of Mrs.Sonia Khosla in the petition was that she held 49% shares in the Company which have been reduced to 36% and that the affairs of the Company were being managed in a manner being oppressive to the minority shareholders. 4. There are events that arose thereafter. According, to the appellant, Mr. Wadia Prakash and Mr.Vinod Surha ceased to be directors of the Company on 30.09.2006. Further, on 18.12.2007 in a purported meeting of the Company held Mr. Deepak Khosla and Mr. R.K. Garg were appointed as directors of the Company and the Board allotted 6.58 lakhs equity shares to 11 persons being part of the Appellant Group. The Bakshi Group of course have stated that the alleged meeting of 18.12.2007 was illegal. 5. The CLB vide its order dated 31.01.2008 where the matter was pending directed the parties to maintain status quo with regard to the shareholdings and the directors of the Company as it existed ....
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....2009 came up for hearing on 13.04.2010 when this court issued notice in the appeal and the application for condonation of delay and ordered that the operation of the impugned order dated 31.01.2008 as far as it cancels the shareholdings of the appellant and his directorship shall remain stayed. 8. Against the said order dated 13.04.2010 and some other orders, an SLP being SLP No. 23796-98/2010 was filed by Mr. Vikram Bakshi before the Supreme Court. The SLP was disposed of by order dated 08.05.2014 with the directions to the CLB to decide Co. Pet. 114/2007 filed by Mrs. Sonia Khosla within a period of six months. The CLB was also directed to decide the application filed under Section 340 Cr.P.C. filed by Mrs. Sonia Khosla. Similarly, the question as to whether Sh. R.K. Garg was validly inducted as a director or not was to be gone into by the CLB and the proceedings in the company appeal i.e. Co. Appeal (SB) No. 23/2009 filed by Mr. R.K. Garg in the High Court were held to be otiose. 9. The present appeal is also emanating from the Company Petition No. 114/2007 that was filed by Mrs. Sonia Khosla. This appeal has been filed on 11.11.2008. It has been pleaded that there are two pri....
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....rson and learned counsel appearing for the respondent. The appellant has made various submissions. However, the broad contentions which can be culled out from his submissions are as follows:- (i) He submits that in view of the fact that Mr. Vikram Bakshi had moved an application under Section 8 of the Arbitration Act on 31.08.2007, the CLB ceased to have any jurisdiction to pass any further orders subsequently till it first settles the fundamental issue of its own jurisdiction. As it failed to do so all other orders passed subsequent to 31.08.2007 till 20.10.2008 are void ab initio and non-est. It is further pleaded that lack of jurisdiction by the CLB is further proved by the orders passed by CLB itself on 20.10.2008 and 28.07.2008 where the CLB has itself conceded that it does not have jurisdiction to pass any orders. (ii) It is pleaded that the appellant need not seek any declaration that the said orders are void ab initio as they are deemed to be a nullity. Reliance is placed on the judgment of the Supreme Court in Nawabkhan Abbaskhan vs State of Gujarat, (1974) 2 SCC 121 to support the said contention. (iii) It is further pleaded that this court may not go into the....
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....ed. 14. I may first look at the judgment of the Supreme Court dated 08.05.2014. As already noted above, one of the orders that was challenged in the Supreme Court was the order dated 13.04.2010 passed by this Court in Co. Appeal(SB) 23/2009 which appeal was filed by Mr.R.K.Garg. This appeal being Co. Appeal (SB) 23/2009 arose from the orders of the CLB dated 31.01.2008 whereby the CLB had directed status quo with regard to shareholdings and directors as it existed on the date of filing of the Co. Pet. i.e. 13.08.2007. 15. As noted above, two other appeals had already been filed before this court against the order dated 31.01.2008 of the CLB, namely, the first appeal was filed by Mr.R.P. Khosla, father of the appellant being Co.Appeal (SB) 7/2008 which was disposed of on 11.04.2008. Mrs. Sonia Khosla also filed an appeal being Co. Appeal (SB) No. 6/2008 which was disposed of by this Court on 22.04.2008. The review petitions filed by both Mr. R.P. Khosla and Mrs.Sonia Khosla were also dismissed/disposed off on 06.05.2008. 16. Noting these gamut of facts and the background of the dispute, the Supreme Court disposed of the SLPs noting as follows: "23. After considering the ....
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....urned the matter sine die. It has been pleaded by the appellant that all the orders passed by the CLB after 31.08.2007 till 20.10.2008 are void ab initio. The present appeal has been filed on 11.11.2008. Section 10F of the Companies Act, 1956 reads as follows: "10.F. Appeals against the order of the Company Law Board.-Any person aggrieved by any decision or order of the Company Law Board may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Company Law Board to him on any question of law arising out of such order: Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.]" As per the above provision, an appeal can be filed within 60 days from the date of the communication of the order. Condonation of delay up to another maximum period of 60 days is permissible on showing sufficient cause. Hence, no appeal can lie against an order of the Company Law Board to this court under Section 10F of the Companies Act after 120 days. 19. I may not....
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....end the limitation beyond sixty days in addition to the original period of sixty days (total 120 days) for filing an appeal as proviso to Section 10F does not permit such extension. Applying this principle enumerated hereinabove and the discussion, the maximum period available to the appellant for preferring the appeal was sixty + sixty days, i.e., 120 days up to March 24, 2007, subject to the condition that the appellant has shown sufficient cause for condonation up to sixty days beyond the prescribed period of sixty days. As noticed above, the initial period of 60 days in filing the appeal under Section 10F expired on January 23, 2007 and the extended period under the proviso to Section 10F expired on March 24, 2007. Hence, even if the contention of the appellant is accepted that he calculated initial period of filing the appeal as 90 days and the part of the period spent in the Delhi High Court is also considered to be the sufficient cause, it cannot be extended beyond 120 days, i.e., March 24, 2007. The present appeal having been filed on May 16, 2007, is barred by time." 21. The above judgment was upheld by the Supreme Court in SLP(C) 17522/2008 dated 16.4.2010. 22. I may n....
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....n sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof. (3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made." 26. Hence, a judicial authority before which an action is brought which is the subject matter of an arbitration agreement, the Court shall refer the parties to arbitration. The Supreme Court in Sukanya Holdings (P) Ltd. vs. Jayesh H.Pandya and Anr., (2003) 5 SCC 531 while interpreting Section 8 held as follows:- "12. For interpretation of Section 8, Section 5 would have no bearing because it only contemplates that in the matters governed by Part I of the Act, the judicial authority shall not intervene except where so provided in the Act. Except Section 8, there is no other provision in the Act that in a pending suit, the dispute is required to be referred to the arbitrator. Further, the matter is not required to be referred to the Arbitral Tribunal, if: (1) the parties to the arbitration agreement have not filed any s....
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....ication by public fora (courts and tribunals), may by necessary implication stand excluded from the purview of private fora. Consequently, where the cause/dispute is inarbitrable, the court where a suit is pending, will refuse to refer the parties to arbitration, under Section 8 of the Act, even if the parties might have agreed upon arbitration as the forum for settlement of such disputes. 36. The well-recognised examples of non-arbitrable disputes are: (i) disputes relating to rights and liabilities which give rise to or arise out of criminal offences; (ii) matrimonial disputes relating to divorce, judicial separation, restitution of conjugal rights, child custody; (iii) guardianship matters; (iv) insolvency and winding-up matters; (v) testamentary matters (grant of probate, letters of administration and succession certificate); and (vi) eviction or tenancy matters governed by special statutes where the tenant enjoys statutory protection against eviction and only the specified courts are conferred jurisdiction to grant eviction or decide the disputes." 28. Similarly, in Rashtriya Ispat Nigam Ltd. & Anr. vs. Verma Transport Co., (2006) 7 SCC 275, the Supreme Court held as foll....
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....the first statement on the substance of the dispute, in our opinion, the party cannot be said to have waived its right or acquiesced itself to the jurisdiction of the court. What is, therefore, material is as to whether the petitioner has filed his first statement on the substance of the dispute or not, if not, his application under Section 8 of the 1996 Act, may not be held wholly unmaintainable. We would deal with this question in some detail, a little later. xxx 38. In Janki Saran Kailash Chandra [(1973) 2 SCC 96] an application for time to file written statement was considered to be a step in the proceedings. We have noticed hereinbefore the respective scope of Section 34 of the 1940 Act vis-à-vis the scope of Section 8 of the 1996 Act. In view of the changes brought about by the 1996 Act, we are of the opinion that what is necessary is disclosure of the entire substance in the main proceeding itself and not taking part in the supplemental proceeding. 39. By opposing the prayer for interim injunction, the restriction contained in sub-section (1) of Section 8 was not attracted. Disclosure of a defence for the purpose of opposing a prayer for injunction would not ....
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....io as is sought to be argued. 31. I may note that no specific argument has been addressed as to the nature of the proceedings that have taken place between the said two dates, namely, 31.08.2007 to 20.10.2008. I may look at some of the orders passed by the CLB which are sought to be assailed in the present proceedings on the ground of being void ab initio. 25.09.2007: CLB noted that the application would be heard on 12.10.2007 and reply be filed. 26.10.2007: CLB noted that hearing on arbitration agreement concluded and order has been reserved. 12.11.2007: CLB adjourned the matter to 26.11.2007. 26.11.2007: CLB imply noted that the compromise efforts have failed. 24.12.2007: CLB noted that an application had been mentioned by the petitioner and stay was sought regarding the Board Meeting to be conveyed on 26.12.2007. The application was directed to be heard on 28.02.2008. CLB directed the respondent therein to defer the Board Meeting till disposal of the application. 03.01.2008: CLB again noted that an application has been mentioned. Interim orders were passed though no board meeting by either side be held. 08.01.2008: CLB noted that the order has been reserved....