2017 (8) TMI 1200 - SCH - Companies Law

Breach of principles of natural justice - non-observance of Principles of Natural Justice - whether CLB did not give any opportunity to make submissions to the appellant on the main company petition? - Held that - No reason to interfere with the impugned order passed by the High Court of Karnataka at Bangalore 2016 (8) TMI 826 - KARNATAKA HIGH COURT as held until the party approaches before the Civil Court, appropriate interim order could have been considered by CLB but, in our view, when no motion was made before CLB, all such aspects shall be a mere academic exercise but, suffice it to observe that as and when such contingency arises in law, the parties may move before CLB or may be before Civil Court as the case may be and at that stage, rights and contentions of both the sides would remain open. We do not find that the decision of CLB is against any law or is based on any irrelevant material or omission to consider the relevant material. Thus the appeal fails Accordingly, the Special Leave Petition stands dismissed. Having regard to the facts and circumstances of this case, the question of law with regard to Section 58 of the Companies Act is kept open. We make it clear that the observations made by the High Court in its impugned order shall not stand in the way of the final adjudication of the Company Petition pending before the learned Company Board.

Summary

The Supreme Court of India dismissed the Special Leave Petition and upheld the order passed by the High Court of Karnataka at Bangalore. The question of law regarding Section 58 of the Companies Act was left open for further consideration. The observations made by the High Court will not affect the final adjudication of the Company Petition pending before the Company Board.