9911796707
TMI Blog1971 (9) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... September 17, 1964, the Union of India (first respondent) filed an application before the Company's Tribunal (respondent No. 2) constituted under section 10A of the Companies Act, 1956 (hereinafter referred to as "the Act"), against the appellant under sections 388B and 388E of the Act. The application was also directed against the appellant, his father, Shanti Prasad Jain, and two others, namely, Fian Chand Jain and P. K. Ray. In that application the Union of India prayed for a finding that the respondents in that application were not fit and proper persons to hold the office of directors or any other office connected with the conduct or management of Benett Coleman and Co. Ltd. and/or any other company. There was also a prayer for such further or other orders as the circumstances of the case might require. The Tribunal admitted the application and numbered it as Case No. 1 of 1964. A second application was filed before the Tribunal by the first respondent, under section 388C of the Act, asking for an interim direction upon the petitioner and some other persons not to discharge their duties as directors of Benett Coleman and Co. Ltd. until further orders of the Tribunal. On this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1965, the appellant moved this court under article 226 of the Conftitution praying for a declaration that sections 388B to 388E of the Act were ultra vires the Constitution, and as such void, and for appropriate writs directing the respondents in this appeal not to proceed with Case No. 1 of 1964 and to withdraw the said proceedings. A rule nisi was issued along with an interim order restraining the respondent from proceeding in Case No. 1 of 1964, for a period of three weeks in the first instance and thereafter until disposal of the rule. By a judgment and order dated April 20, 1966, Banerjee J. discharged the rule and this appeal is directed against this judgment and order. Before proceeding any further it is to be noticed that by Act 17 of 1967, Chapter IV of of the Companies Act, 1956, was extensively amended. The effect of the amending Act was that the Tribunal ceased to exist and all cases pending before the Tribunal stood transferred to the High Court which would have had jurisdiction in the matter. The result is that the pending application regarding the appellant before the Tribunal stood transferred to the High Court of Bombay and is now pending before that court. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bombay High Court. He further argued that the powers of the High Court under article 226 were wide enough to enable it to issue any writs, orders or directions, and, therefore, appropriate orders could be made restraining the respondents from proceeding with the Case No. 1 of 1964 now pending before the Bombay High Court. He submitted that his client was not disentitled to relief in the writ petition merely because the Tribunal ceased to exist by virtue of the amendment to the Act. These are the contentions of the parties on the question of relief to the appellant in this appeal having regard to the subsequent event, namely, the amendment to the Act, by which the Tribunal was abolished. In order to appreciate the rival contentions of the parties it is necessary to refer to the relevant provisions in Act No. 17 of 1967. Section 2 provides that on the commencement of the Act the Companies Tribunal constituted under section 10A of the Companies Act, 1956, shall stand abolished. Sub-section (3) of section 3 runs as follows : "(3) Save as otherwise provided in sub-section (1) and sub-section (2), every proceeding under the said Act, pending before the Tribunal immediately before it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as not been, conducted by the respondent in that application in accordance with sound business principles. This charge is covered by clause ( b ) of section 388B(1) of the Act. The third charge is that the business of the company has been conducted and managed by the respondent in that application for a fraudulent or unlawful purpose or in a manner prejudicial to public interest. This charge is covered by clause ( d ) of section 388B(1) of the Act. In paragraph 31 it is stated that after due consideration of the facts presented to the applicant, the applicant is of opinion that there are circumstances suggesting the charges mentioned above and also an additional charge, namely, that the respondents in that application have been conducting and managing Benett Coleman and Co. Ltd. in a manner which has or is likely to cause serious injury and damage to the interest of the industry and business to which the company pertains. This charge is in conformity with clause ( c ) of section 388B(1) of the Act. It is to be noticed that this charge was not set out in paragraph 5 of the application. I shall refer to the particulars of the charges at greater length later in the judgment. Mr. S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is to be noticed that the first, second and third respondents in the application before the Tribunal are members of a family and the charge against them was conspiracy, collusion and concert. Thirdly, the appellant was a director of the company, participated at board meetings which affirmed, acted upon and gave effect to the various resolutions of the board as well as those passed at the meeting of the company. In support of his contention mentioned above Mr. Deb, firstly, relied on a decision of the Supreme Court Barium Chemicals Ltd. v. Company Law Board [1966] 36 Comp. Cas. 639 , 662 ; [1966] Supp. S.C.R. 311 A.I.R. 1967 S.C. 295 . In that case the question that arose for decision of the court was whether the words "If in the opinion of the Central Government" in section 237( b ) of the Act required that existence of circumstances suggesting inference of what has been set out in sub-clause ( i ), ( ii ) or ( iii ) must be made out or whether those words merely required formation of opinion as a subjective process. The majority of the Supreme Court was of the opinion that though the formation of the opinion was subjective, the existence of circumstances relevant to the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued that on the materials disclosed in the affidavit-in-opposition filed in the writ petition and the application filed before the Tribunal, it could not be said that there were circumstances which would entitle the respondent No. 1, so far as the appellant was concerned, to file the application before the Tribunal for a report. The above contention of counsel for the appellant is founded on the fact that the appellant became a director of the company some time after the events complained of had happened, and, therefore, the appellant could not have participated in the acts of misfeasance, fraud and corrupt practice. It was argued that since the appellant was not. a director of the company at the time when the wrongful acts were alleged to have been committed there could be no occasion for investigation into the conduct of the appellant by an application under section 388B of the Act. Counsel for the appellant further contended that his client became a director of the company on April 13, 1963, but resigned the directorship on September 13, 1964. Before the appellant became a director of the company the Central Government in exercise of its power under section 237 of the Act ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the paper book), in which it is alleged that the allegations against the directors can only be substantiated if the top management, namely, general manager, upwards was removed even if for a temporary period. In this memorandum there is also an allegation of threatened destruction or removal of material evidence by the top management of the company. Taking all these materials into consideration I do not think that there is any substance in the contention of counsel for the appellant that the action taken against the appellant under section 388B of the Act was based on irrelevant materials or that the decision of the Central Government to commence proceedings was unjustified. It was next argued that the word "may" used in the section should not be read as "shall" or "must" and should be construed to invest the Central Government with absolute discretion. It was further contended that there was nothing in section 388E to hold that discretion was coupled with duty, so as to construe the word "may" to mean "shall" or "must" ( sic ) in so far as the two sections invested the Central Government with absolute discretion to proceed against one individual under the penal sections 388B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he words of the Lord Chancellor on this point: "But, there may be something in the nature of the thing empowered to be done, something in the object for which it is to be done, something in the conditions under which it is to be done, something in the title of the person or persons for whose benefit the power is to be exercised, which may couple the power with a duty, and make it the duty of the person in whom the power is reposed, to exercise that power when called upon to do so". The next case relied on by counsel for the appellant was a decision of the House of Lords, Padfield v. Minister of Agriculture, Fisheries and Food [1968] A.C. 997 (H.L.) . In that case a parliamentary statute contained provisions relating to the milk marketing scheme. The statute provided that if a complaint was made to the minister regarding the operation of any scheme, the Minister shall appoint a committee of investigation, which should report to the Minister on the complaint. The producers in one region made a complaint to the Minister but he refused to appoint a committee of investigation. Thereupon the complainants applied to the court for an order of mandamus. Following the decision in F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Central Government to make a reference whenever circumstances indicated in the section exist, and, indeed, when such circumstances exist, the Central Government has got no choice or opinion in the matter but must make a reference as contemplated by the section. I now proceed to deal with the question if circumstances existed to justify proceedings against the appellant under sections 388B and 388E of the Act. In the two decisions of the Supreme Court mentioned earlier, namely, Barium Chemical's case ( supra ) and Rohtas Industries case ( supra ), it was held that if the existence of circumstances suggesting an inference of matters set out in clause ( i ), ( ii ) or ( iii ) of section 237( b ) was challenged, the existence of such circumstances had to be proved at least prima facie, and it was not enough to assert that circumstances existed and give no indication of what they were. But it was also held, however, that formation of opinion by the Central Government was a subjective process and could not be questioned. In this case the Central Government came to a decision that a reference should be made under section 388B of the Act and the formation of the opinion by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent and that similar arrangements should be made for him to receive unaccounted money from Bennett Coleman Co. Ltd. It is next alleged that S. P. Jain suggested that purchases made by the company should be inflated both as to quantity and price, and so inflated, purchases should be entered in the company's books and the difference between actual price and the inflated price should be paid to S. P. Jain. The officers of the company pointed out that the main item of purchase was newsprint, the rate of which was well-known, and any manipulation of price would be impossible. S. P. Jain thereupon directed that the company's sales should not be accounted for truly or in full in the books of the company. S. P. Jain also directed that the proceeds shown in the company's books should be lower than those actually received, and the difference should be paid to him. The items in respect of which such operations were to be carried out were newsprint waste, machinery and other miscellaneous items. In accordance with this suggested practice, full sale proceeds of newsprint wastes were not credited in the company's books, but only a part thereof was recorded and the balance was handed over t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is also alleged that irregular payments of various sums, namely, Rs. 6,000, Rs. 14,876, Rs. 1,000 and Rs. 57,600 were made to various parties. The next allegation relates to payment of arrears of dividends on preference shares from 1948 to 1954 amounting to Rs. 26,63,710 to Bharat Union Agencies, on a mandate from Ram Krishna Dalmia, the previous chairman of the company. It is alleged that the company's minute books show that it was decided on August 9, 1955, that as the company's profit for the year was not sufficient to declare dividend, no dividend could be paid in the year ended December 31, 1954. Yet, on October 5, 1955, it was resolved to borrow Rs. 30 lakhs from Bharat Nidhi Ltd., a company controlled by S. P. Jain and his associates, and a resolution was passed on October 28, 1955, to pay out the aforesaid, amount representing arrears of dividend on preference shares up to December 31, 1954. The payment of dividend was made without compliance with the prescribed procedure for approval and declaration of dividends. It is next alleged that the accounting practice followed by the company is in violation of section 209 and section 211 read with Schedule VI, Parts ( i ) and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e charges and it is for them to prove that the charges are unfounded or false or are such as not to merit an investigation under section 388B of the Act. On the materials, such as they are, we have no hesitation in holding that there were sufficient materials in existence to enable the Central Government to form an opinion that an investigation under section 388B of the Act is called for. I now proceed to deal with the next contention of counsel for the appellant that sections 388B to 388E confer unanalyzed and uncontrolled discretion on the Central Government to pick and choose between one person and another and, for that reason, powers to discriminate between person and person have been created and conferred by those sections, which, therefore, should be held to be violative of article 14 and declared void. It was argued that in similar circumstances the Central Government might pick and choose among several persons and might commence proceedings under section 388B of the Act against a particular individual, while ignoring same or similar charges against others. Secondly, it was argued that after the Tribunal had found several individuals guilty of the charges under section 388 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... among different classes or groups of persons likely to be affected by a statute. In that case the question was whether the Punjab Forward Contract Tax Act, 1951, was ultra vires the powers conferred upon the State Legislature. This decision was relied on for the proposition that in a writ petition a declaration may be prayed for that an Act or a particular section thereof is ultra vires the Constitution. In our view, this contention of the counsel for the appellant that in an appropriate case a declaration to the effect mentioned above may be prayed for and allowed is sound. No doubt, in an appropriate case a declaration may be prayed for, and the court, in exercise of its power under article 226, is competent to grant such a prayer. But the question in this case is not merely whether a declaration such as mentioned above should be granted but whether a writ should be issued or an order made to stop the proceedings before the Bombay High Court, where the proceedings now stand transferred by reason of the operation of the statute. The next case relied on was also a decision of the Supreme Court in Kunnathat Thathunni Moopil Nair v. State of Kerala A I.R. 1961 S.C. 552 . I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... infringed, complete relief could not be granted merely by declaring the existence of the right or that the right had been infringed and that the court would be justified in giving a consequential relief by directing refund of taxes paid under a statutory provision which had been struck down. This decision again is of no assistance to the appellant in this case because we are in no doubt that if section 388B of the Act violated article 14 and if the reference was pending before a Tribunal and not a High Court, this court could not only have struck down the reference itself but would have stayed, by injunction, further proceedings in that reference. As it is, however, we are of the view that section 388B of the Act does not infringe article 14 and also of the view that no writ or order can be issued by this court to stay, stop or interfere with a proceeding before another High Court in an application under article 226 of the Constitution. Reliance was next placed on a decision of the Supreme Court in Ha ri Chand Sarda v. Mizo District Council A.I.R. 1967 S.C. 829 . In that case certain regulations relating to tribals in Mizo Hills were held to be void as they provided no principl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or, to prevent recurrence of the evil, the act of the Central Government in initiating proceedings could not be condemned as discriminatory nor could the action be declared to be bad, on the ground that it was violative of article 14. In support of this contention, counsel for the respondents relied on a decision of the Supreme Court in Ram Krishna Dalmia v. Justice S. R. Tendolkar A.I.R. 1958 S.C. 538 . Reliance was also placed by counsel for the respondents on another decision of the Supreme Court, Basheshar Nath v. Commissioner of Income-tax [1959] 35 I.T.R. 190; [1959] Supp. 1 S.C.R. 528 ; A.I.R. 1959 S.C. 149. Reliance was next also placed by counsel for the respondents on the decision of the Supreme Court in Manohar Lal Bhogilal Shah v. State of Maharashtra A.I.R. 1971 S.C. 1511 . In that case it was contended that for the offence of smuggling of goods a person could either be dealt with by the customs authorities by proceeding under section 167(8) of the Sea Customs Act, 1878, or in the alternative or in addition to such proceedings, by instituting a prosecution in a criminal court under section 187A read with section 167(81). It was contended that it was left ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 388B of the Act is violative of article 14 must fail and is accordingly rejected. I now turn to another question canvassed before us by counsel for the appellant. It was argued that the Central Government failed to apply its mind to the facts in coming to a decision that action should be taken against the appellant under section 388B and section 388E of the Act. In support of this contention, counsel for the appellant relied on the averments in paragraph 8( a ) of the affidavit affirmed by Davinder Singh Dang on December 4, 1965, which is to be found at pages 80-81 of the supplementary paper book. In that paragraph of the affidavit it is alleged that the appellant as a director of the company acted in violation of section 240 of the Act by denying or directing denial by the company's employees of production of relevant books, and also denying assistance to the inspector appointed to investigate into the company's affairs. It is also alleged that such denial embraced refusal to answer questions by the company's officers, and to produce books of the company before the inspector when requested to do so. There are also allegations of destruction of and tampering with relevant record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and if without giving any finding on any of the issues framed, and also without prejudice to the respondent's rights and contentions in certain criminal proceedings and proceedings under taxation laws, the court made any order with a view to prevent or render impossible the affairs of the company being conducted in a manner prejudicial to public interest or prejudicial to the interest of the company, or with a view to nullifying the effect of any change in the management and control of the company, they would submit to the orders of the court without objection. The second respondent in that petition, namely, S. P. Jain, further submitted that he would not only submit to the orders of the court without objection but would consent to such orders being passed whatever be the nature of the orders. Thereafter, the court invited learned counsel for the parties to make their submissions with regard to the nature of the orders that the court should make. Upon this direction, counsel for the 4th respondent in that petition (appellant in this appeal) stated that his client submitted to the orders of the court. On these submissions being made on behalf of the respondents in that petition, N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking to the minutes. We are told by counsel for the respondent that no stay of operation of the order of the Bombay High Court had been obtained, so that the order disqualifying that appellant from being a director of the company again, and the injunction restraining the appellant from interfering with or intermeddling with the affairs of the company remain in force and are binding. The application for speaking to the minutes was disposed of by an order, dated September 2, 1969. In that application it was contended on behalf of the respondents in that application before the Bombay High Court that although it was submitted by counsel on their behalf that an order should be made without making a finding, a finding had, in fact, been made in so far as it was held that some of the existing and former directors of the company were disqualified from becoming directors again and in so far as the order of injunction was issued restraining them from interfering or intermeddling with the affairs of the company. In dealing with this contention that the order made amounts to a finding, the learned judge observed as follows : "I do not agree with the contention that this amounts to a findi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... up by the directors of the company and also by lack of co-operation, suppression of material evidence and similar other reasons. This was followed by an application before the Companies Tribunal on September 17, 1964, under section 388B in which specific charges were made against the directors of the company and also the appellant, according to whom he had ceased to be a director on the day when the application was filed. Whatever other grounds may exist for assailing the order of reference, a charge of non-application of mind or failure to apply its mind by the Central Government cannot, in our opinion, be one of them. Failure to apply its mind implies indecisive conduct which is singularly lacking in this case. Far from there being any evidence of indecisive procrastination the Central Government appears to us to have been extremely prompt, diligent and active in bringing to an end the mismanagement in the affairs of the company. We have therefore no hesitation in rejecting the contention of the counsel for the appellant that the order of reference is bad on the ground of non-application of mind by the Central Government. I now turn to the effect of the judgment of the Bomba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oncerned in the management of the affairs of the company, against whom there is a decision of the High Court under Chapter IV-A of the Act. Sub-section (3) of section 388E bars a person, against whom an order of removal from office has been made, from holding the office of a director or any other office connected with the management of the affairs of a company for a period of 5 years from the date of order of removal. The combined effect of section 388B and section 388E is that a director or other person connected with the company's management against whom a decision has been recorded by the High Court, is to be removed, by an order of the Central Government, from the office held by him, and he is barred from holding the office for a term of 5 years from the date of the order. This is all that the appellant will suffer in the event of the decision of the Bombay High Court going against him in the proceedings under section 388B of the Act. But as I have noticed earlier the judgment and order of the Bombay High Court, dated August 28, 1969, imposes a very much more severe penalty upon the appellant, as he has been disqualified from becoming a director of the company again. Whereas, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e enactment is competent to make the amendment of the section, and the section so amended, must be held to be valid. Before passing I should refer to two decisions of the Supreme Court on which Mr. Deb relied in support of his contentions on this point. First of these cases is Saghir Ahmad v. State of U. P. A.I.R. 1954 S.C. 728. In that case the question of vires of the U. P. Road Transport Act, 1951, was under consideration of the Supreme Court. By that Act, the State Government was empowered to declare that road transport services on any route should be run by the State Government exclusively and it was held that the impugned Act violated article 19(1)( g ) of the Constitution and was not protected by clause (6) of the article as it stood at the time of enactment and before amendment of the Constitution by the First Amendment Act of 1951. After amendment of article 19(6) of the Constitution in 1951, the State Government was given the power to carry on any trade or business to the exclusion of private citizens wholly or in part. The question was whether this amendment which came after the impugned enactment could save the enactment from being void. It was held that the amend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s further argued, stood denuded of all its powers under section 388B of the Act. The power of delegation was exercised and a notification was issued by the Central Government in exercise of its powers under section 637(1) of the Act. Sub-section (2) of that section prescribes various sections, the powers under which cannot be delegated by the Central Government. Section 388B of the Act is not mentioned in sub-section (2). Sub-section (2A) provides that the Act shall apply in relation to the Company Law Board as they applied in relation to the Central Government in respect of any matter in relation to which the powers and functions of the Central Government had been delegated to the Company Law Board. These are the material provisions in the Act relating to delegation of powers by the Central Government to the Board. Before proceeding to deal with Mr. Deb's contentions, I should refer to sub-section (6) of section 10E of the Act which is as follows: "(6) In the exercise of its powers and discharge of its functions, the Company Law Board shall be subject to the control of the Central Government". Relying on the provisions mentioned above, Mr. Deb submitted that once having dele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were taken by the local authority. In considering the question whether any of the powers remained vested in the Minister after delegation, it was held that the Minister did not retain general powers of supervision. It was held that in any area of local Government if the Minister had by delegation transferred his powers to a local authority, he stood divested of those powers and that out of the wide executive powers which the primary delegated legislation contained in regulation 51(1) and had been conferred upon him to be exercised at his discretion, he retained only those powers which in his sub-delegated legislation he had expressly or impliedly reserved to himself. This decision, to our mind, is easily distinguishable from the facts in the appeal now before us because by virtue of sub-section (6) of section 10E of the Act, which I have quoted earlier, the Central Government retained the overall control over the Company Law Board in exercise of its powers under the Act. The Central Government, therefore, retained full control over the acts of the Board in discharge of its functions. But, in the decision mentioned above the Minister by his delegation had retained no power for himse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not justified in assuming jurisdiction which had been conferred on the licensing authority. The ratio of that decision was that the State Government which was an appellate authority under the statute could not convert itself into an original authority, and deal with the application for licence as an original authority. This decision again does not support the contention of the counsel for the appellant as the Supreme Court did not deal with the question of delegation at all but with the question whether the State Government could assume original jurisdiction in a matter under the statute by which it was appointed an appellate authority. Reliance was next placed on a Bench decision of this court in State of West Bengal v. Ruttonjee Co. A.I.R. 1970 Cal. 548, for the proposition that the word "control" contemplated by section 8(1) of the Bengal Excise Act meant control to be exercised by issuing general instructions or directions, but that power could not authorise the State Government to issue specific instructions about the disposal of a particular application. Quite apart from the fact that words and terms used in a particular statute in one context cannot be interpreted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f their jurisdiction, the State Government was competent to pass an order of detention under rule 30. In that case counsel for the appellant relied on the decision of the Judicial Committee in King Emperor v. Sibnath Banerji A.I.R. 1945 P.C. 156 in support of his contention that once delegation of powers having been made, the delegating authority stood divested of all its powers. This contention was negatived by the Supreme Court and it was held that by issuing the notification the State Government had not denuded itself of the power to act under rule 30 of the Rules framed under the Defence of India Act. The next decision relied on by Mr. Banerjee was Huth v. Clarke [1890] 25 Q.B.D. 391 (Q.B.) . It was contended, on behalf of the appellant in that case, that delegation implied abdication or denudation of power and the power so delegated could not be resumed until the delegation had been specifically revoked. Lord Coleridge C.J., in rejecting the contentions, held as follows : "The word 'delegation' implies that powers are committed to another person or body which are, as a rule, always subject to resumption by the power delegating, and many examples of this might be giv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Board. Section 637 of the Act which authorised the Central Government to make the delegation does not indicate that a deligation made under that section has the effect of a complete abdication or surrender of power by the Central Government to the Board. In our view, the position of the Board is that by virtue of the delegation it is enabled to exercise powers and discharge functions, which, but for the delegation, it could not do. The Central Government, in our view, does not, by virtue of the delegation, stand denuded or divested of all its powers under section 388B of the Act. In that view of the matter the contention of the counsel for the appellant on this point fails and is accordingly rejected. I now turn to the question of the maintainability of the writ petition having regard to the amendment of the Act, by which the Companies Tribunal was abolished and the High Court was substituted in place of the Companies Tribunal and all proceedings pending before the Tribunal stood transferred to the High Court. But, before doing so, I will briefly refer to one other matter. The company involved in this case is Bennett Coleman Co. Ltd. The charges against the appellant relate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court was substituted in its place. By virtue of this amendment the respondents' application before the Tribunal, now stands transferred to the High Court of Bombay. The question is whether this court should issue a writ prohibiting the High Court of Bombay to proceed further with the hearing of the application or making an order quashing those proceedings, or making any other order which will have the effect of interfering with the hearing of the application by the Bombay High Court. The word "tribunal" used in Chapter IV-A of the Act was substituted by the words "High Court" by the Companies Tribunal (Abolition) Act, 1967. The result of the amendment is that all proceedings under Chapter IV-A are to be commenced before the High Court, having jurisdiction in the matter, and all pending proceedings before the Tribunal, stand transferred to the High Court. In this case, as I have noticed earlier, the proceedings stand transferred to the Bombay High Court and is now pending in that court. The amendment of the Act mentioned above, as I have noticed earlier, was made after the judgment of the trial court and during pendency of this appeal. In the petition, as it stands, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at a writ cannot be issued by this court against the Bombay High Court so as to stop further hearing of the application, counsel for the appellant pressed for a declaratory relief and also an injunction as mentioned above. It was not contended by Mr. Deb that this court had jurisdiction to issue a writ against the Bombay High Court so as to stop that court from proceeding with the hearing of the pending application. Mr. Deb said that although a writ or order could not be issued against the Bombay High Court, a declaratory relief as prayed for and an injunction should be granted to the appellant. Keeping in mind the fact that the application is now pending before the Bombay High Court, can such an order be made ? We think not. The effect of such an order would be plainly to stultify the hearing of the application which is now pending before another High Court. This would have the effect of doing indirectly what this court is prevented by law from doing directly. Any attempt to prevent or prohibit the hearing of the pending application before the Bombay High Court in exercise of its statutory jurisdiction would plainly be an abuse of the process of the court and if this court issues ..... X X X X Extracts X X X X X X X X Extracts X X X X
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