1961 (10) TMI 9 - SC - Companies Law

Whether the application for execution was barred by limitation as it was not preferred within three years from the order of the High Court? Held that - The High Court was right in holding that the application for execution filed by the official liquidator was within limitation. The appeal, therefore, fails and is dismissed with costs

Summary

Issues:
1. Application of Limitation Act to the execution of an order under the Indian Companies Act, 1913.
2. Jurisdiction of the High Court in directing payment under section 187 of the Indian Companies Act, 1913.
3. Interpretation of "ordinary original civil jurisdiction" in the context of High Court's authority.

Analysis:

1. The judgment dealt with the application of the Indian Limitation Act to the execution of an order under the Indian Companies Act, 1913. The High Court initially ordered payment by certain appellants, which was later transferred for execution. The appellants argued that the application for execution was time-barred under article 182 of the Limitation Act, while the official liquidator contended it was governed by article 183. The Civil Judge held the application barred, but the High Court of Allahabad reversed this decision. The Supreme Court determined that the application for execution was not time-barred under article 183, as it was within the prescribed period, ultimately dismissing the appeal.

2. The judgment also delved into the jurisdiction of the High Court in directing payment under section 187 of the Indian Companies Act, 1913. The appellants argued that the High Court's authority in such matters was not ordinary, original, or civil. However, the Supreme Court clarified that the High Court's jurisdiction to order payment under section 187 was ordinary, original, and civil in nature. The Court emphasized that the High Court had the authority to direct payment of amounts due by contributories, and the jurisdiction was not dependent on extraordinary actions but was part of the High Court's ordinary functions.

3. The interpretation of "ordinary original civil jurisdiction" in the context of the High Court's authority was crucial in this judgment. The Court referred to precedents and legal provisions to establish that the High Court's jurisdiction in matters related to companies ordered to be wound up was part of its ordinary civil jurisdiction. The judgment cited cases like Candas Narrondas In re and Munia Servai v. Hanuman Bank Ltd. to support the conclusion that the High Court's jurisdiction in such cases was ordinary and fell within the scope of article 183 of the Limitation Act. The Court upheld the High Court's decision that the application for execution was within limitation, emphasizing the ordinary civil nature of the High Court's jurisdiction in such matters.

In conclusion, the Supreme Court upheld the High Court's decision, emphasizing the ordinary, original, and civil nature of the High Court's jurisdiction in directing payment under the Indian Companies Act, 1913. The judgment clarified the application of the Indian Limitation Act to execution orders under the Act and highlighted the precedents supporting the interpretation of "ordinary original civil jurisdiction" in the context of the High Court's authority.