2018 (4) TMI 1773 - HC - Companies Law

Maintainability of plaint - service of notice - rejection of plaint on the ground that the defendant being a company registered under the Companies Act, there is a statutory bar under Section 430 of the Companies Act, 2013, to entertain Civil Suit - HELD THAT - This Court is of the opinion that the plaintiff has approached the forum which does not have jurisdiction over the subject matter in dispute, in view of Section 241 and 430 of the Companies Act, 2013 - Hence, the plaint is rejected.

Summary

Issues: Jurisdiction of the court over the subject matter; Compliance with statutory notice requirements for Annual General Meeting; Applicability of Sections 241, 244, and 430 of the Companies Act; Common law remedy versus statutory provisions for notice.

Jurisdiction of the Court: The plaintiff filed a suit against the Madras Christian College Association, claiming that the Annual General Meeting held without proper notice was null and void. The defendant argued that as a company under the Companies Act, the suit should be rejected under Section 241 of the Act, which deals with acts of oppression or prejudice to be addressed through the Tribunal, not civil suits. The court found that the plaintiff had approached a forum lacking jurisdiction due to the statutory provisions of the Companies Act and rejected the plaint, allowing the plaintiff to seek recourse through the Tribunal as per the Act.

Compliance with Statutory Notice Requirements: The plaintiff contended that not receiving a 21-day notice for the Annual General Meeting was deliberate, not accidental, as church nominees had long sought lawful representation. The defendant's counsel cited Sections 241, 244, and 430 of the Companies Act to support rejecting the plaint. The court noted that the plaintiff's entitlement to notice under Section 101 of the Companies Act did not apply due to the deliberate nature of the alleged omission, leading to the rejection of the suit.

Applicability of Sections 241, 244, and 430 of the Companies Act: The defendant's counsel highlighted these sections to argue for rejecting the plaint, emphasizing that the alleged oppression or prejudice fell under the purview of the Companies Act and should be addressed through the Tribunal. The court concurred, stating that the plaintiff's claims were subject to the provisions of the Act, and the civil suit was not the appropriate forum for redressal.

Common Law Remedy vs. Statutory Provisions: The plaintiff argued for a common law remedy based on the entitlement to notice as per the Companies Act, except for accidental omissions. However, the court found that the deliberate nature of the alleged omission precluded such relief, as the statutory provisions of the Companies Act, particularly Sections 241 and 430, governed the situation. Consequently, the court rejected the plaint but allowed the plaintiff to pursue remedies through the Tribunal under the Companies Act.