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2024 (6) TMI 963 - HC - Companies LawIssues involved: The judgment involves the application of Section 430 read with Sections 58 and 59 of The Companies Act, 2013, in a case where the Trial Court rejected the plaint under Order VII Rule 11 (a) and (d) read with Section 151 of The Code of Civil Procedure, 1908, for rejection of plaint. Adjudication on the application under Order VII Rule 11: The appeal stemmed from the rejection of the plaint by the Trial Court under Order VII Rule 11 (a) and (d) read with Section 151 of The Code of Civil Procedure, 1908, based on an application filed by the defendants. The Trial Court directed the return of the plaint for filing before a proper forum, leading to the appellant challenging this decision. Jurisdiction of Civil Court vs. NCLT/NCLAT: The main issue before the Court was whether the appellant could be ousted from the domain of the City Civil Court by virtue of Section 430 read with Sections 58 and 59 of The Companies Act, 2013. The Trial Court's rejection was primarily based on the interpretation of Clause 8 of the Share Purchase Agreement (SPA) as a bar on the Civil Court's jurisdiction, directing parties to arbitration instead. Interpretation of Section 430 and Sections 58 & 59 of The Companies Act, 2013: The Court disagreed with the Trial Court's view and analyzed the provisions of Section 430 along with Sections 58 and 59 of The Companies Act, 2013. Section 430 acts as a bar on Civil Courts from entertaining matters within the jurisdiction of NCLT/NCLAT, delineating the zones of adjudication between the two. Sections 58 and 59, dealing with registration and rectification of securities, were invoked by the respondents to argue for NCLT jurisdiction, but the Court found these provisions inapplicable to the case. Relevance of Arbitration Clause and Remedies: The Court highlighted the importance of Clause 8 of the SPA, which provided for arbitration in case of disputes. It emphasized that the Trial Court could have referred the dispute to arbitration based on this clause but erred in rejecting the plaint under Sections 58 and 59 of The Companies Act, 2013. The judgment emphasized that no litigant should be left without a remedy and set aside the impugned order, allowing the appeal. Precedents and Conclusion: The judgment referenced similar cases to support its decision and concluded that the Trial Court's rejection of the plaint based on Section 430 read with Sections 58 and 59 of The Companies Act, 2013, was erroneous. The appeal was allowed, and the case was disposed of in favor of the appellant.
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