Dismissed

Gulab Jain and Others v. Union of India and Others

Chhattisgarh HC10 Nov 2017COMP/7/2004

Case brief

AI extract

What is this about?

The High Court of Chhattisgarh, Bilaspur, in Comp No. 07 of 2004, held that a company petition directly filed before it under sections 397, 398, 399 read with section 402 of the Indian Companies Act, 1956, is not maintainable as section 10FB of the Companies (Second Amendment) Act, 2002 mandates complaints to be filed before the Company Law Board.

What did the court decide?

The company petition is dismissed as not maintainable. The petitioner is directed to avail remedy before the Company Law Board.

Gulab Jain and Others Vs Union of India and Others — Company and Corporate | Chhattisgarh HC (2017)

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NAFR

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HIGH COURT OF CHHATTISGARH, BILASPUR

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COMP No. 07 of 20 0 4

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Gulab Jain, S/o. Shri Lal Chand Jain, aged 44 years, R/o. Shanichar Bazar, Durg (C.G.)

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Kishorechand Jain, S/o. Lalchand Jain, Age 41 years, R/o. Shanichari Bazar, Durg (C.G.)

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Harikrishna Thakur, S/o. Shri P.C. Thakur, Age 49 years, R/o. Kota, Raipur (C.G.)

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Mangal Yadav, S/o. Shri Jagdev Prasad Yadav, Age 46 years, R/o. Deepak Nagar, Durg (C.G.)

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Chhannulal Yadu, S/o. Shri Jagdish Prasad Yadu, Age 42 years, R/o. Purani Basti, Raipur (C.G.)

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Prakash Bagmar, S/o. Shri Jugrajji Bagmar, Age 35 yers, R/o. Dondi, Durg (C.G.)

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Ramesh Jain, S/o. Shri Gendmal Jain, Age 34 years, R/o. Brahmanpara, Rajnandgaon (C.G.)

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Smt. Anita Parekh, W/o. Shri Ramesh Jain, Age 28 years, R/o. Brahmanpara, Rajnandgaon (C.G.)

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Suresh Gupta, S/o Shri Baburam Gupta, Age 48 years, R/o. Amapara, Raipur (C.G.)

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Smt. Nisha Jain, W/o. Sanjay Jain, Age 38 years, R/o. Shailendra Nagar, Raipur (C.G.)

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Smt. Saroj Soni, W/o. Shri Kishore Soni, Age 36 years, R/o. Shanichari Bazar, Durg (C.G.)

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Smt. Usha Bagmar, W/o. Shri Prakash Bagmar, Age 37 years, R/o . Dondi, Durg (C.G.)

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Rahul Jain, S/o. Shri Kishore Jain, Age 19 years, R/o Shanichari Bazar, Durg (C.G.)

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Ankush Jain, S/o. Shri Gulab Jain, Age 17 years, R/o. Choubey Colony, Raipur (C.G.), through Legal guardian fate Gulab Jain S/o L.C. Jain

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Fanindra Jain, S/o. Shri Gulab Jain, Age 23 years, R/o. Choubey Colony, Raipur (C.G.)

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Gaurav Jain, S/o. Shri Gulab Jain, Age 19 years, R/o. Choubey Colony, Raipur (C.G.)

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Arvind Chatur, S/o. Shri P.M. Chatur, Age 52 yeas, R/o. Choubey Colony, Raipur (C.G.)

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Rajesh Baid, S/o Shri G.C. Jain, Age 35 years, R/o. Shailendra Nagar, Raipur (C.G.)

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Rakesh Baid, S/o Shri G.C. Jain, Age 33 years, R/o. Shailedna Nagar, Raipur (C.G.)

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Sunita Chatur, W/o. Shri Siddarth, Age 40 years,, R/o. Choubey Colony, Raipur (C.G.)

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Nirmal Kothari, S/o. U.C. Kothari, Age 38 years, R/o. Kamthee Line, Rajnandgaon (C.G.)

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Kamal Parakh, S/o. Shri Gendmal Parakh, Age 38 years, R/o. Brahman Para, Rajnandgaon (C.G.)

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Nalin Jain, W/o. Shri Umedchand Jain, Age 35 years, R/o. Kamthee Line, Rajnandgaon (C.G.)

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Gayan Chand Kothari, S/o Shri Hukum Chand Kothari, Age 40 years, R/o. Azad Chowk, Rajnandgaon (C.G.)

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Sulochana Parekh, S/o. Shri C.S. Parekh, Age 43 years, R/o. Shanti Colony, Dhamtari (C.G.)

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---- Petitioners

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Versus

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Union of India, through the Secretary, Company Affairs, New Delhi, India

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The Registrar of Companies, Madhya Pradesh & Chhattisgarh, Post Box No.2, Sanjay Complex, A Block, 3^rd Floor, Jayendraganj, Gwalior (M.P.)

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Santosh Golchha, S/o. Late Shri Kewalchan Golchha, Aged about 52 years, R/o. Usha Kiran Malviyanagar, Durg (C.G.)

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Dilip Golchha, S/o. Manohar Lal Golchha, Aged about 30 years, R/o. Ayodhya Apartment, Malviyanagar, Durg (C.G.)

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Himalaya Commercial Complex Pvt. Ltd. Through Director, Santosh Golchha, Supela Square, Bhilai (C.G.)

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For Petitioner : Mr. M.L. Sen, Advocate on behalf of Mr. S.C. Verma, Advocate.

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For Respondent No.5 : Mr. S. Rajeshwar Rao, Advocate.

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Hon'ble Shri Justice Sanjay K. Agrawal

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Order On Board

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1 0 / 11/2017

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(1) Learned counsel appearing for respondent No. 5 would submit that application under Sections 397, 398, 399 read with Section 402 of the Indian Compaines Act, 1956 for appropriate relief in cases of oppression directly filed to this Court is not maintainable because as per Section 10FB of the Companies (Second Amendment) Act, 2002, Company Law Board has been constituted and any person, who is aggreived by the affairs of the Company, has to file complaint before the Company Law Board but in the instant case without availing the remedy as prescribed undre Companies (Second Amendment) Act, 2002, the petitioner has directely filed the Company petition before this Court, which is not maintainable in law.

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(2) Counsel for the petitioner would submit that the Company petition as framed and filed is maintainable before this Court for hearing and objection so raised be overruled.

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(3) I have heard learned counsel appearing for the parties and perused the order impugned with utmost circumspection.

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(4) At this stage, it would be appropriate to notice Section 397 and Section 10FB of the Companies (Second Amendment) Act, 2002, which read thus:-

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“ 397. Application to [Tribunal] for relief in cases of oppression- (1) Any members of a company who complain that the affairs of the Company [are being conducted in a manner prejudicial to public interest or] in a manner oppressive to any member or members (including any one

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or more of themselves) may apply to the [Tribunal] for an order under this section, provided such members have a right so to apply in virtue of section 399.

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(2) If , on any application under sub-section (1), the [Tribunal] is of opinion -

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(a) that the company's affair [are being conducted in a manner prejudicial to public interest or] in a manner oppressive to any member or members; -

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(b) that to wind-up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the making of a winding-up order on the ground that it was just and equitable that the company should be wound-up;

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Section 10 FB of the Companies (Second Amendment) Act, 2002:

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“10FB. Constitution of National Company Law Tribunal.- The Central Government shall, by notification in the Official Gazette, constitute a Tribunal to be known as the National Company Law Tribunal to exericse and discharge such powers and functions as are, or may be, conferred on it by or under this Act or any other law for the time being in force.”

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(5) A bare perusal of the aforesaid provisions of law would show that application under Sections 397, 398, 399 read with Section 402 of the Indian Compaines Act, 2002 for appropriate relief in cases of oppression directly to this Court is not maintainable because as per Section 10FB of the Companies (Second Amendment) Act, 2002, Company Law Board has been constituted with effect from 13.01.2003 and any person, who is aggreived by the affairs of the Company, has to complaint before the Company Law Board. Thus, the application under Section 397, 398, 399 read with Section 402 of the Indian Compaines Act, 1956 filed before this Court is held to be not maintainable before this Court.

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(6) Accordingly, the company petition fails and is hereby dismissed as not maintainable. However, the petitioner is at liberty to avail remedy before the Company Law Board as per Section 10FB of the Act. No cost(s).

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Sd/-

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(Sanjay K. Agrawal) Judge

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D/-

Gulab Jain and Others v. Union of India and Others

Case brief

What is this about?

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Gulab Jain and Others v. Union of India and Others

Case brief

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