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2019 (5) TMI 609 - HC - Companies LawGrant of Leave to the Original Petitioner to bring the Official Liquidator of the Company on record in a suit - winding up of Company - HELD THAT - It is ex facie clear that Section 430 of the 2013 Act, which was not even a statutory provision in force at the relevant time of orders in the present Company Petition, can have no bearing on the authority or jurisdiction of this Court to grant leave under Section 446 of the 1956 Act in a petition that was and continues to remain within the jurisdiction of this Court. At the relevant time this Court undoubtedly had jurisdiction to consider the Application for leave under Section 446 of the 1956 Act. Section 465(2) of the 2013 Act states that notwithstanding the repeal of the 1956 Act, any Order made under the 1956 Act, shall be deemed to have been made under the corresponding provision of the 2013 Act, provided that such Order is not inconsistent with the provisions of the 2013 Act. Section 446 of the 1956 Act corresponds to Section 279 of the 2013 Act and is not, in any manner whatsoever, inconsistent with the provisions thereof - In any view of the matter the Order dated 17th September 2013 passed by this Court in exercise of its powers under Section 446 of the 1956 Act, shall be deemed to be an Order passed under Section 279 of the 2013 Act. Accordingly, any reliance on Section 430 of the 2013 Act to contend that the said Order is annulled or void by the enaction of Section 430 of the 2013 Act is without any basis whatsoever, as the said Order would be expressly saved by Section 465 read with Section 279 of the 2013 Act. The Company Application is accordingly dismissed.
Issues Involved:
1. Validity of the Order granting leave under Section 446 of the Companies Act, 1956 after the enactment of the Companies Act, 2013. 2. Application of the doctrine of estoppel in the context of simultaneous proceedings. 3. Jurisdiction of the High Court under Section 430 of the Companies Act, 2013. 4. Retrospective application of Section 430 of the Companies Act, 2013. 5. Repeal and saving provisions under Section 465 of the Companies Act, 2013. Detailed Analysis: 1. Validity of the Order granting leave under Section 446 of the Companies Act, 1956 after the enactment of the Companies Act, 2013: The Applicant sought a declaration that the Order granting leave under Section 446 of the 1956 Act is rendered null and void due to the repeal of the 1956 Act and its substitution by the 2013 Act. The Court concluded that the Order granting leave remains valid because the Company Petition is a 'saved Petition' and continues within the jurisdiction of the High Court. The Order was passed before the 2013 Act came into force and is thus not affected by the new legislation. 2. Application of the doctrine of estoppel in the context of simultaneous proceedings: The Applicant argued that the grant of leave under Section 446 of the 1956 Act is contrary to the doctrine of estoppel, allowing two proceedings to proceed simultaneously. The Court rejected this argument, clarifying that the doctrine of estoppel does not apply because the nature of the Suit for recovery of money and the winding-up proceedings are entirely different. The Suit is against the Company and the Applicant as guarantor, while the winding-up proceeding is a statutory right of a creditor resulting in an order in rem. 3. Jurisdiction of the High Court under Section 430 of the Companies Act, 2013: The Applicant contended that Section 430 of the 2013 Act ousts the jurisdiction of the High Court. The Court dismissed this contention, stating that Section 430 does not retrospectively invalidate Orders passed under the 1956 Act. The winding-up process for 'saved Petitions' continues under the provisions of the 1956 Act, and the High Court retains jurisdiction over such matters. 4. Retrospective application of Section 430 of the Companies Act, 2013: The Applicant argued that Section 430 is a procedural provision and operates retrospectively. The Court found no merit in this submission, stating that Section 430 is a substantive provision on the ouster of jurisdiction of a civil court and does not apply retrospectively. The Orders passed under the 1956 Act remain valid and are not affected by the enactment of Section 430. 5. Repeal and saving provisions under Section 465 of the Companies Act, 2013: The Court emphasized that Section 465 of the 2013 Act saves Orders made under the 1956 Act. Section 465(2) states that any Order made under the 1956 Act is deemed to have been made under the corresponding provision of the 2013 Act, provided it is not inconsistent with the new Act. The Order granting leave under Section 446 of the 1956 Act corresponds to Section 279 of the 2013 Act and is thus saved by Section 465. Conclusion: The Court dismissed the Company Application, finding no merit in the Applicant's contentions. The Order granting leave under Section 446 of the 1956 Act remains valid and is saved under Section 465 of the 2013 Act. The doctrine of estoppel does not apply, and the High Court retains jurisdiction over the winding-up proceedings for 'saved Petitions.' The Applicant's arguments on the retrospective application of Section 430 were also rejected. The Application was dismissed with no order as to costs.
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