1960 (2) TMI 32 - SC - Companies Law

Whether the Act of 1956 indicates that it was intended thereby to destroy the rights created by section 153-C of the Act of 1913? Held that - Section 10 of the Act of 1956 deals only with the jurisdiction of courts. It shows that the District Courts can no longer be empowered to deal with applications under the Act of 1956 in respect of matters contemplated by section 153-C of the Act of 1913. This does not indicate that the rights created by section 153-C of the Act of 1913 were intended to be destroyed. section 24 of the General Clauses Act puts an end to the notification giving power to the District Judge, Poona, to hear the application under section 153-C of the Act of 1913 as that notification is inconsistent with section 10 of the Act of 1956 and the District Judge cannot, therefore, continue to deal with the application.Section 24, therefore, does not cancel the notification empowering the District Judge of Poona to exercise jurisdiction under the Act of 1913. It seems to us that since under section 6 of the General Clauses Act the proceeding in respect of the application under section 153-C of the Act of 1913 may be continued after the repeal of that Act, it follows that the District Judge of Poona continues to have jurisdiction to entertain it. If it were not so, then section 6 would become infructuous. Appeal dismissed.

Summary

Issues:
Jurisdiction of the court post-repeal of the Companies Act of 1913 under the Companies Act of 1956.

Analysis:
The case involved shareholders (Respondents) of a company (Appellant) who filed an application under section 153-C of the Companies Act of 1913, seeking relief. However, before the application could be decided, the Companies Act of 1913 was repealed and replaced by the Companies Act of 1956. The Appellant argued that the court lacked jurisdiction post-repeal, but the District Judge and the High Court dismissed this argument, leading to the appeal in the Supreme Court.

The Supreme Court examined the provisions of the Companies Act of 1956, specifically sections 644 to 657, which dealt with repeals and saving provisions. The Appellant contended that the proceeding under section 153-C of the Act of 1913 was not saved by any provision in the Companies Act of 1956. However, the Court invoked section 6 of the General Clauses Act, which states that legal proceedings can continue post-repeal unless a different intention appears.

The Court further analyzed the intention behind the repeal and re-enactment of the legislation. Referring to a previous judgment, it highlighted that the new Act must manifest an intention to destroy old rights and liabilities for the repeal to affect ongoing legal proceedings. The Court found no such intention in the Companies Act of 1956 to abolish the rights created by section 153-C of the Act of 1913.

Moreover, the Appellant argued that the District Court's jurisdiction to hear the application had ceased post-repeal due to changes in the Companies Act of 1956. However, the Court clarified that changes in jurisdiction did not imply an intention to destroy existing rights. Section 24 of the General Clauses Act was also discussed, emphasizing that it did not terminate the notification empowering the District Judge to hear the application under the Act of 1913.

Ultimately, the Court held that the legal proceeding could continue post-repeal under section 6 of the General Clauses Act, and the District Judge retained jurisdiction to entertain the application. The appeal was dismissed, affirming the lower courts' decisions, and costs were awarded to the Respondents.