1979 (4) TMI 138 - HC - Companies Law

Summary

Issues Involved:
1. Jurisdiction and power of the court under section 446(3) read with section 518(1)(b) of the Companies Act, 1956.
2. Conduct of the District Board, Rohtas.
3. Balance of convenience and the location of evidence.
4. The nature of the claim by the District Board, Rohtas.
5. Transfer of the Title Suit No. 164 of 1978 from the Sub-Judge's Court, Sasaram, to the High Court of Calcutta.

Detailed Analysis:

1. Jurisdiction and Power of the Court:
The petitioner argued that the court has jurisdiction and power under section 446(3) read with section 518(1)(b) of the Companies Act, 1956, to transfer Title Suit No. 164 of 1978 from the Sub-Judge's Court, Sasaram, to the High Court of Calcutta. The court referred to an unreported decision in the case of Agra Electric Supply Company Ltd. (In voluntary liquidation) v. Nagar Mahapalika, Agra, which fully covers the question of the court's jurisdiction and power to transfer a suit under the mentioned sections.

2. Conduct of the District Board, Rohtas:
The petitioner highlighted the conduct of the District Board, Rohtas, which included initiating multiple criminal proceedings under section 144 of the Cr. PC and filing a suit to obtain an ex parte injunction. The court found this conduct to be unreasonable and harassive, aimed at preventing the liquidators from discharging their duties. The court noted that the District Board's actions were intended to obstruct the winding-up proceedings and prevent the purchaser from taking delivery of the goods.

3. Balance of Convenience and Location of Evidence:
The petitioner argued that the balance of convenience favored the trial being held in Calcutta since the company's registered office, joint liquidators, books, papers, and documents were all located in Calcutta. The purchaser, Technical Steel & Alloy Company Ltd., also had its office and business in Calcutta. The court agreed, noting that the material evidence, both documentary and oral, was mostly in Calcutta, making it more convenient and less expensive to try the suit there.

4. Nature of the Claim by the District Board, Rohtas:
The claim by the District Board, Rohtas, was identified as a money claim involving the interpretation of certain documents. The court noted that such a claim could be conveniently tried by the winding-up court, which has jurisdiction over the company in voluntary liquidation. The court emphasized that the liquidators would have enough funds to pay any valid claims from the sale proceeds.

5. Transfer of the Title Suit:
The court concluded that it was a fit and proper case to exercise its power to transfer the suit under section 446(3) read with section 518(1)(b) of the Companies Act, 1956. The court ordered the transfer of Title Suit No. 164 of 1978 from the Sub-Judge's Court, Sasaram, to the High Court of Calcutta for expeditious trial. The Registrar, Original Side, of the High Court of Calcutta was directed to transmit a certified copy of the order to the Subordinate Judge's Court at Sasaram, which was then to transmit the records of the suit to the High Court of Calcutta.

Conclusion:
The High Court of Calcutta exercised its jurisdiction under section 446(3) read with section 518(1)(b) of the Companies Act, 1956, to transfer Title Suit No. 164 of 1978 from the Sub-Judge's Court, Sasaram, to itself. The court found that the balance of convenience, the conduct of the District Board, Rohtas, and the nature of the claim warranted the transfer for a more efficient and just resolution of the matter. The court's decision was guided by the principles laid down in the Agra Electric Supply Company Ltd. case and other relevant legal precedents.