2012 (3) TMI 629

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....ure, 1908 (CPC) is to the impugned judgment of the trial Court dated 4.4.2005 rejecting the plaint under Order 7 Rule 11 CPC on the ground that disputes which were subject matter of the suit under the Companies Act, 1956 (hereinafter referred to as 'the Act') had to be decided by the Company Law Board by virtue of Section 111 of the Act. 2. The facts of the case are that the plaintiffs filed the subject suit for declaration and mandatory injunction on the pleading that the shareholding of defendant Nos.3 and 6 to 9 of the defendant No. 1 was of Redeemable Preference Shares issued in the year 1957 for a term of 10 years redeemable in the year 1967; that the defendant No. 1-company issued a notice dated 12.10.1996 for holding of an E....

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....which were due for redemption in the year 1967. The trial Court has dismissed the suit by making the following observations:- 9. It is true that for deciding an application U/O 7 Rule 11, the averments made in the plaint are to be considered. Defence of the defendant in the Written Statement has to be ignored. In the suit plaintiff prayed for decree of declaration declaring that 3065 6% Tax Free Cumulative Redeemable Preference Share cannot be substituted by fresh issuance of shares. The second declaration sought was that after due date of redemption of 3065 Preference Shares the right of shareholders was only to recover the share money. Since 29 years had passed, the debt had become time barred. The third prayer was for decree of mandato....

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.... trial Court held that the jurisdiction of the Civil Court was barred as the Company Law Board has jurisdiction under Section 111 of the Act. In my opinion, the trial Court has misdirected itself in holding that the jurisdiction of the Civil Court is barred. Section 111, sub-sections (4) and (5) of the Act are in fact reproduction of the erstwhile Section 155 of the Act. The repealed Section 155 of the Act reads as under:- 155. Power of Court to rectify register of members.-(1) If- (a) the name of any person- (i) is without sufficient cause, entered in the register of members of a company, or (ii) after having been entered in the register, is, without sufficient cause, omitted therefrom; or (b) default is made, or unnecessary dela....

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....hall apply in relation to the rectification of the register of debenture holders as they apply in relation to the rectification of the register of members. 5. While dealing with the provision of Section 155, the Supreme Court in the case of Claude-Lila Parulekar (Smt) Vs. Sakal Papers (P) Ltd. and Ors. (2005) 11 SCC 73 had held that the jurisdiction of the Company Court under Section 155 of the Act and of the Civil Court under Section 9 of CPC is concurrent. I may also refer to the judgment of the Supreme Court in the case of Ammonia Supplies Corporation (P) Ltd. Vs. Modern Plastic Containers Pvt. Ltd. and Ors. (1998) 7 SCC 105 which holds that highly disputed questions of fact in fact ought to be decided by the Civil Court and not by the ....