TaxTMI 
TaxTMI 
2016 (12) TMI 1808
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....ction. Sections 111 and 111A of the Companies Act, 1956 stand replaced on 12th September, 2013 by insertion of new Sections 58 and 59 of the Companies Act, 2013. On 12th December, 2013, Mr. Mazda forwarded a copy of petition under Section 111A(2) of the Act to the appellant Company. Thereafter Sri Mazda presented the petition before the Company Law Board on 13th December, 2013. On 16th December, 2013, a letter was issued by the Bench Officer to rectify the defects and submitted further documents. On an advice that the said application may not be maintainable under the provisions of the old Act, since new Act by the time had come into force on 3rd February, 2014, Sri Mazda filed a petition under Section 58 of the Companies Act, 2013 along with an application under Regulation 44 of the Company Law Board Regulations, 1991 for condonation of delay and for enlargement of time. The Bench Officer of CLB by a letter dated 18th February, 2014 informed the Advocate of Sri Mazda that the petition filed on 13th December, 2013 being defective remained unnumbered. The subsequent petition for self-same relief was filed on 7th February, 2014 and registered as CP No.31 of 2014. The appellant fil....
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....tice or in case no notice has been sent by the company within a period of 60 days from the date on which the instrument of transfer or the intimation of the transmission as the case may be was delivered to the company. It is submitted that admittedly there is a delay of 249 days and since Section 58 sub-section 4 of the Companies Act does not permit any enlargement of time beyond the aforesaid periods, the Company Law Board has clearly erred in allowing condonation of delay. It is submitted that the Company Law Board has completely misdirected its mind and has assumed a jurisdiction which it does not possess. The learned Senior Counsel has referred to the following decisions of the Hon'ble Supreme Court in support of his submission that the Limitation Act does not apply to Tribunal or Quasi-Judicial bodies which includes Company Law Board:- 1) Town Municial Corporation, Athani Vs. Presiding Officer reported at (1969) 1 SCC 873; 2) Nityanand M. Joshi Vs. LIC Three Judge Bench reported at AIR 1970 SC 209, (1969) 2 SCC 199; 3) Sushila Devi Vs. Ramanandan Prasad reported at AIR 1976 SC 177, (1976) 2 SCR 845; 4) Sakura Vs. Tanaji reported at AIR 19....
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....ion and the appeal is a continuation of the original proceeding, the appellate court can always take notice of the change in law and apply the said provisions in order to do complete justice between the parties as failure to do so might result in multiplicity of proceedings. It is argued that even if the order of the Company Law Board is reversed nothing would prevent the petitioner to apply afresh for rectification with a prayer for condonation and the tribunal would be competent to decide the application on merits. That demonstrable injustice would be caused in the event such rectification is not allowed is also emphasized to pursue this Court to affirm the order passed by the Company Law Board. That the Court can take into account the change of law and the present position and mould its relief the following decisions were relied upon:- i) Mohanlal Chunilal Kothari Vs. Tribhovan Haribhai Tamboli & Ors. reported at AIR 1963 SC 358; ii) H.V. Rajan Vs. C.N. Gopal & Ors. reported at (1975) 4 SCC 302; iii) In re: Chattaranjan Bhadra & Ors. reported at 1986 (I) CHN 479. It was further argued that Section 111(4) of the Companies Act, 1956, however, has not ....
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....111A. Rectification of register on transfer. - (1) In this section unless the context otherwise requires, "company" means a company other than a company referred to in subsection (14) of Section 111 of this Act. (2) Subject to the provisions of this section, the shares or debentures and any interest therein of a company shall be freely transferable: [Provided that if a company without sufficient cause refuses to register transfer of shares within two months from the date on which the instrument of transfer or the intimation of transfer, as the case may be, is delivered to the company, the transferee may appeal to the [Tribunal] and it shall direct such company to register the transfer of shares.] (3) The [Tribunal] may, on an application made by a depository, company, participant or investor or the Securities and Exchange Board of India, if the transfer of shares or debentures is in contravention of any of the provisions of the Securities and Exchange Board of India Act, 1992 (15 of 1992) or regulations made thereunder or the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986) or any other law for the time being in force, within two months from the date of tr....
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....f the original proceeding before the Tribunal. The said Section can only apply prospectively and cannot affect a pending proceeding. The learned Counsel seeks to draw sustenance in support of the submission from the following decisions:- i) Lakshminarayan Guin & Ors. Vs. Niranjan Modak reported at AIR 1985 SC 111; ii) Gajraj Singh & Ors. Vs. State Transport Appellate Tribunal & Ors. reported at (1997) 1 SCC 650; iii) Moti Ram Vs. Suraj Bhan & Ors. reported at AIR 1960 SC 655; iv) Akshat Commercial Pvt. Ltd. & Anr. Vs. Kalpana Chakraborty & Ors. reported at AIR 2010 Calcutta 138. Under the provisions of Companies Act, 1956, the Company Law Board (CLB) is a Court in a restricted sense. Under Section 10E (4C) of the Companies Act, 1956, the CLB would have powers under the Code of Civil Procedure, 1908 (5 of 1908) only in respect of the matters specified in Section 10E (4C) (a) to (f) of the Companies Act. The Company Law Board is a quasi-judicial authority to be guided by the principles of natural justice in exercise of its power and discharge its functions under the Companies Act, 1956 and it shall act in its discretion. There cannot be any d....
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....vision covering application under Section 111, the residuary Article, namely, Article 137 would apply. In Smt. Nupur Mitra (supra), the Hon'ble Division Bench relying upon a decision of the Hon'ble Supreme Court in Canara Bank (supra) held that in proceedings under Section 111 of the Act the provisions of the Limitation Act would apply. The judgment was taken in appeal wherein the Supreme Court after observing, "various contentions are raised on behalf of both the parties before us and, in particular on behalf of the appellants as regards the limitation and delay. The respondents in their petition have made out a prima facie case for condonation of delay and if necessary, the respondents may file such documents as permissible in law to get the delay condoned", directed the Company Law Board to hear the matter afresh. Thus, in view of the Supreme Court upholding the decision of the Calcutta High Court that the provisions of the Limitation Act are applicable to the proceedings under Section 111 of the Companies Act, the said decision was binding on the Company Law Board. If so, then the application for condonation of delay can be considered under Section 5 of the Limitation Act. I....
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.... with any order visits the company with a fine. In regard to all those matters it has exclusive civil jurisdiction (except under the provisions of Special Courts Act, which is the issue before us). Certain observations of Supreme Court in Ammonia Supplies Corpn. Vs. Modern Plastic contained: (1998) 4 Com. LJ 211 (SC) would also appear to suggest that in certain matters the jurisdiction under section 111 is exclusive." A Co-ordinate Bench in M/s. Mackintosh Burn (supra) answered the said question in the manner following:- "Section 58(4) of the Act permits an application though the exact word used is "appeal" to be filed by a person within the time stipulated in such provision. The provision is for the benefit of the transferees of shares in a public company and the time-limits are 60 days from the date f the refusal to register the transfer or 90 days of the delivery of the instrument for transfer to the company without any intimation as to its fate. Though the provision sets the time-limits as above, nothing therein prevents the Company Law Board from receiving a petition or application thereunder beyond the stipulated period. Since it is now judicially r....