TaxTMI 
TaxTMI 
2018 (12) TMI 963
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.... and other business relating to information technology. The registered office of the company was in Delhi and the two became Directors with 50% each shareholding in the company. Over a period of time differences cropped up between them. In August 2011 to avoid differences they discontinued the relationship. As per the understanding arrived at they agreed to partition/transfer the assets and liabilities of respondent No.1, an MOU dated 9.11.2011 was prepared. The properties in Uttam Nagar and Pitam Pura were to be exchanged. Giving effect to the understanding the appellant executed a sale deed on 8.11.2011 in favour of respondent No.2 transferring the properties in Uttam Nagar. The grievance of the appellant is that respondent No.2 failed to register the sale deed of the Pitampura properties in favour of the appellant. The appellant also pleads that respondent No.2 has forged her signatures on the documents. Allegations of siphoning of funds from the respondent No.1 company has also been made. It is also urged that Board Resolution and resignation letter of the appellant from the Board of Directors were also allegedly forged by respondent No.2. 3. The respondent No.2 has refuted th....
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....ve started as the terms of MOU have not been carried out as agreed upon by respondent No.2. The learned Tribunal took the view that though the reliefs in the suit and the company petition may be different but the subject matter of the suit and the company petition are identical. It also holds that if CLB were to exercise jurisdiction, it would bring one court's order in conflict with another court's order. The order further holds that the acts alleged to have been conducted by respondent No.2 would have to be viewed whether such acts happened pursuant to the MOU or were on account of oppressive acts done by respondent No. 2 to cause prejudice to the appellant and the Company. If latter was to follow, then the case would fall under the ambit of Sections 397 and 398 of the Companies Act. If former was to follow, then the appellant would not be entitled to any relief sought as the conduct of the respondent would be based on the MOU entered into and acted upon. Accordingly, the CLB noted that the subject matter of the company petition is the same as that of the suit and stayed the proceedings before the CLB under Section 10 CPC. 6. I have heard learned counsel for the parties. 7. Lea....
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.... applies only in cases where the whole of the subject matter in both the suits is identical. The key words in Section 10 are "the matter in issue is directly and substantially in issue" in the previous instituted suit. The words "directly and substantially in issue" are used in contra-distinction to the words "incidentally or collaterally in issue". Therefore, Section 10 would apply only if there is identity of the matter in issue in both the suits, meaning thereby, that the whole of subject matter in both the proceedings is identical." 11. The Calcutta High Court in Anup Agarwalla & Ors. vs. Castron Mining Ltd. & Ors., (2012) 111 CLA 405 (Cal) on the issue held as follows:- "1. This appeal has been filed by Anup Agarwalla and his group from the order dated 17th April, 2009 passed by the Company Law Board (CLB). Sections 397 and 398 proceedings were filed by the appellant before the CLB on grounds of oppression. An interim order was passed on 8.5.2007 restraining the respondents from using the name of the Company or acting on its behalf. On an application for vacating the interim order the proceedings before the CLB has been stayed till disposal of the Title Suit filed in Alipore....
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....eedings, if the foundation of those principles could be traced to public policy. Keeping this in mind, if we have a look once again at section 4(1) of the Code of Civil Procedure, (to which I have already made a reference in paragraph-above) it will be clear that the provisions of the Code do not limit or otherwise affect any special or local law or any special jurisdiction or power conferred or any special form of procedure prescribed by any other law. .... 73. Therefore, I hold on the 2nd question of law that the power under regulation 44 of the CLB (Regulations) 1991, would include a power to stay its own proceedings pending the adjudication of a dispute in a previously instituted suit. This is due to the fact that one test for the applicability of Section 10 of the Code is whether or not, the final decision in the previous suit would operate as res judicata in the subsequent suit. Therefore, if principles analogous to res judicata could be applied to proceedings to which CPC would not apply, then on the same analogy, the principles upon which the power under Section 10 of the Code is based, could also be invoked by the Tribunals, to which CPC would not apply. The absence in t....
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.... funds, contravention of statutory provisions etc. The court noted that the scope of enquiry in the Company Petition filed by the respondents was entirely different and distinct from the scope of enquiry in the suit previously instituted before the Civil Court. Hence, the court held that the proceedings before the CLB has nothing to do with the proceedings in the suit previously instituted and that the proceedings in the two forums are not even remotely identical. On those facts the court held as follows:- "25. The scope of enquiry in the Company Petition filed by the respondents before the Company Law Board, in relation to the matters alleged therein, is entirely different and distinct from the scope of enquiry in the suit previously instituted by the appellants before the Civil Court, which rests on the resolution dated 29-12-2001. The proceedings before the Company Law Board, have nothing to do with the proceedings in the suit previously instituted by the appellants before the Civil Court. The proceedings before both the forums are independent and distinct of each other and are not identical even remotely. In that the various reliefs sought for and the provisions under which su....
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....r property and the Pitampura Property were both valued at identical amount of Rs. 1.21 crores and hence, the transfers were being affected. The plea of the appellant is that respondent No. 2 took advantage of the said arrangement and attempted to usurp the Uttam Nagar property. It is prayed that respondent No. 2 played a fraud on the appellant and the appellant became entitled to rescind the MOU. Further, till March 2012, respondent No. 2 misappropriated above Rs. 2 crores from the account of respondents No. 3 and 4. Based on these allegations, the acts of default/oppression/mismanagement have been stated in the petition which include siphoning of funds of respondent No. 1 Company, default in making payment of government revenues and illegal control and management of the respondent No. 2 Company. 18. I may only note that I have perused the file of the suit that is pending before this court being CS(OS) 1632/2012 titled as Neeru Kapoor vs. Blue Star Infotech Pvt. Ltd. & Ors. A perusal of the plaint shows that the appellant has sought the following reliefs:- "PRAYER It is, therefore, most respectfully prayed that the Hon'ble Court may be pleased to: (A) pass a decree of DECLARATI....
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....explained and unauthorised withdrawals from bank accounts of the defendant No.1 Company having following acounts at (a). State Bank of Hyderabad, Dwarka Branch, New Delhi having account no. 62196208367, (b) UCO Bank, Tagore Garden Branch, New Delhi having account no. 06100200000412, (c) HDFC Bank Ltd., Rani Bagh, Delhi having account no. 0152560007771 and (d) ICICI Bank, Rjouri Garden, New Delhi having account no. 629305037873 and those of the order business entities namely M/s Blue Star Travels (India), having bank accounts State Bank of Hyderabad, Dwarka having account no. 62228295234 and also from opening any new bank accounts on behalf of/in the name of any of the said business entities including in the name of Defendant no.1 company; (F) pass a decree of MANDATORY INJUNCTION in favour of the Plaintiff and against the Defendant no. 2 thereby directing the Defendant no.2 to return (i) cheque books, (ii) documents executed in terms of final draft of the unsigned MOU dated 09.11.2011 (which was subsequently rescinded by the Plaintiff vide Legal Notice dated 27.03.2012); (G) pass a decree of DECLARATION in favour of the Plaintiff and against the Defendants thereby declaring that ....