2012 (4) TMI 733 - HC - Companies Law

Summary

Issues involved: Delay in disposal of appeal, amendments sought by appellants before Company Law Board, justification for allowing/disallowing amendments, legal principles regarding grant of amendments to pleadings, consideration of real controversies between parties, question of delay in seeking amendments.

Delay in disposal of appeal: The appellants had to wait for about four years for disposal of the appeal, causing them to suffer as their main grievance before the Company Law Board could not be redressed.

Amendments sought by appellants: The appeal arose out of the amendments sought by the appellants to their petition before the Company Law Board. The Board initially passed an order allowing some amendments and disallowing others. The amendments sought were related to various paragraphs of the original petition, with the effect of the amendments described in a table presented to the Court.

Justification for allowing/disallowing amendments: In the impugned order, the increase in capital was allowed, but the increase in paid-up capital was disallowed. The Court found justification for allowing the amendments that were permitted but did not find any justification for disallowing the others. The Court opined that all the amendments should have been allowed as they did not change the case or cause prejudice to the respondents.

Legal principles regarding grant of amendments to pleadings: The Court referred to legal judgments emphasizing that a liberal approach should be taken in granting amendments, as long as no new case is introduced or any claim is barred by limitation. The amendments should aim to appreciate the real controversies between the parties to ensure justice.

Question of delay in seeking amendments: The Court was satisfied with the submissions made by the appellants regarding the delay in seeking the amendments, as the knowledge of the subject matter of the amendments was gained after the filing of the original petition.

Decision: The appeal succeeded, and the impugned order of the Company Law Board was partly set aside. The order allowing some amendments was reinstated, and the amendments made in accordance with that order were affirmed. Any stay application was disposed of accordingly.