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2020 (2) TMI 1659 - HC - Companies LawDeclaration, perpetual injunction and possession - edifice of the suit is constructed on the premise that the suit properties were owned by Kalpita Builders Private Limited and could have been alienated only with the consent of two Directors or the majority of Directors - HELD THAT - Section 430 is brought into force with effect from 01st June, 2016, vide Notification No. SO 1934(E), dated 01.06.2016. The submission of the plaintiff, that the jurisdiction of the Civil Court is barred, is on the premise that in view of the coming into force of Section 430, the jurisdiction of the Civil Court is barred, since the NCLT is empowered to deal with and decide the issues framed by the trial Court. It is not even the case of the plaintiff that the Civil Court did not have the jurisdiction to decide the suit. Indeed, the plaintiff invited the Civil Court to decide the legality and validity of the sale deeds executed by Respondent No.1 in favour of Respondents No.2 to 19 and agreement to sell in favour of defendant no.20. The submission is, that the amended provisions of the Act came into force during the pendency of the appeal and, therefore, the appellate Court ceased to have jurisdiction over the matter - the provisions, on which the plaintiff is heavily relying, came into effect from 01.06.2016. Even according to the plaintiff, the Civil Court did have the jurisdiction when the suit came to be decided. If this be so, the fact that Section 430 of the Act has come into effect during the pendency of the appeal, would not necessitate return of the appeal for being presented before the NCLT. Petition dismissed.
Issues:
Jurisdiction of Civil Court in light of Section 430 of the Companies Act, 2013. Analysis: The judgment pertains to a Special Civil Suit brought for declaration, perpetual injunction, and possession, where the plaintiff challenged the alienation of properties by the defendant. The trial Court dismissed the suit, finding that the defendant had the authority to execute the sale deeds. The plaintiff appealed this decision, seeking transfer of the appeals to the National Company Law Tribunal (NCLT) under Section 430 of the Companies Act, 2013. The plaintiff argued that the jurisdiction of the Civil Court was barred by the NCLT's authority. However, the Court noted that the plaintiff initially invoked the Civil Court's jurisdiction and that the NCLT's powers are broader and specialized. The Court highlighted that the NCLT's establishment does not automatically transfer pending appeals from Civil Courts to the NCLT. The Court examined Section 430 of the Companies Act, which restricts the Civil Court's jurisdiction in matters within the NCLT's purview. The plaintiff contended that the NCLT's powers under the Act supersede those of the Civil Court. The Court emphasized that the plaintiff did not dispute the Civil Court's jurisdiction when initiating the suit. Even though Section 430 came into effect during the appeal's pendency, the Court held that this did not mandate transferring the appeal to the NCLT. The judgment underscored that the Civil Court had jurisdiction at the suit's commencement, regardless of subsequent legislative amendments. In conclusion, the Court dismissed the petition, affirming the Civil Court's jurisdiction in the matter. The Court directed the appeals to be resolved promptly, preferably within three months. The judgment elucidated the legal principles governing the jurisdiction of the Civil Court vis-à-vis the NCLT under Section 430 of the Companies Act, 2013, providing clarity on the applicability of the said provision in ongoing legal proceedings.
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