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TMI Blog1993 (10) TMI 230X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court having jurisdiction in relation to the place at which the Company Law Board makes the order under appeal. The material facts giving rise to the above question are only a few, as stated hereafter. A petition under section 397/398 of the Companies Act, 1956, was filed on behalf of the appellant, Stridewell Leathers Private Ltd., before the Company Law Board in respect of the company known as Shoe Specialities Pvt. Ltd. having its registered office at Madras. On May 28, 1993, the Company Law Board in the principal Bench at Delhi made an order in that petition against which an appeal was filed under section 10F in the Delhi High Court by a shareholder, respondent No. 1. The company, Shoe Specialities Pvt. Ltd., also filed an appeal against the same order of the Company Law Board in the Madras High Court (CMA No. 793 of 1993) which is pending. A preliminary objection to the maintainability of the appeal in the Delhi High Court was raised by the present appellants in the appeal filed in the Delhi High Court. The Delhi High Court rejected the preliminary objection on July 29, 1993, and admitted that appeal. This appeal by special leave is against the Delhi High Court's order d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication is found in section 10F of the Companies Act to indicate which High Court is meant as the forum of appeal in such situations, we heard elaborate arguments from both sides for deciding the point in controversy. The point was debated with considerable ability by learned counsel for the parties which has focussed attention on the several nuances of the two points of view. It is with this assistance, we proceed to consider and decide this controversy. The Companies (Amendment) Act, 1988, which has inserted section 10F with effect from May 31, 1991, and has also made some simultaneous changes in section 10E brings about the establishment of an independent Company Law Board to exercise the judicial functions exercised earlier by the courts or the Central Government while providing an appeal to the High Court under section 10F against such orders of the Company Law Board. The power under sections 397 and 398 of the Companies Act, exercised earlier by the court is one such power now exercised by the Company Law Board so constituted. In short, the original jurisdiction of the High Courts in respect of matters under sections 397 and 398 of the Companies Act is now transferred to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this Act, unless the context otherwise requires,‑ . . . (11)'the court' means,‑ (a)with respect to any matter relating to a company (other than any offence against this Act), the court having jurisdiction under this Act with respect to that matter relating to that company, as provided in section 10 ; . . ." "10. Jurisdiction of courts.-(1) The court having jurisdiction under this Act shall be- (a)the High Court having jurisdiction in relation to the place at which the registered office of the company concerned is situate, except to the extent to which jurisdiction has been conferred on any District Court or District Courts subordinate to that High Court in pursuance of sub-section (2) ; and (b)where jurisdiction has been so conferred, the District Court in regard to matters falling within the scope of the jurisdiction conferred, in respect of companies having their registered offices in the district. (2) The Central Government may, by notification in the Official Gazette and subject to such restrictions, limitations and conditions as it thinks fit, empower any District Court to exercise all or any of the jurisdiction conferred by this Act upon the Court, not bei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anies (Amendment) Act, 1988, with effect from May 31, 1991.] (4B) The Board may, by order in writing, form one or more Benches from among its members and authorise each such Bench to exercise and discharge such of the Board's powers and functions as may be specified in the order ; and every order made or act done by a Bench in exercise of such powers or discharge of such functions shall be deemed to be the order or act, as the case may be, of the Board. (4C) Every Bench referred to in sub-section (4B) shall have powers which are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit, in respect of the following matters, namely :- (a)discovery and inspection of documents or other material objects producible as evidence ; (b)enforcing the attendance of witnesses and requiring the deposit of their expenses ; (c)compelling the production of documents or other material objects producible as evidence and impounding the same ; (d)examining witnesses on oath ; (e)granting adjournments ; (f)reception of evidence on affidavits. (4D) Every Bench shall be deemed to be a civil court for the purposes of section 195 and Chapter XXVI of the Code of Crim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10(1)(a) for construing the meaning of the expression "the High Court" in section 10F since the context does not require otherwise and such a construction prevents a hiatus. Care was taken to define the expression "the court" in section 2(11) of the Act providing clearly that the meaning is as provided in section 10 unless the context otherwise requires ; and section 10 providing for the jurisdiction of courts then says that the court having jurisdiction under the Act would be the High Court or the District Court indicated therein. It is unlikely that with such care taken in the principal Act to define "the court" and also specify the court having jurisdiction under the Act, any ambiguity would be left while amending the principal Act in this manner for any doubt about the forum of appeal if it was intended to be different from the existing appellate forum indicated by section 10(1)(a). We have no doubt that an express provision would have been made in the amendment to indicate a different or a substituted appellate forum than the existing appellate forum if that was the intention of the amendment or the jurisdiction of the court for the purpose of appeal had been altered in any m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the Company Law Board to determine the forum of appeal by the choice of place of sitting under the Regulations for making the order. We have no doubt that the forum of appeal indicated in section 10F is a definite forum determined by the provisions of the Act and not by the Regulations framed by the Company Law Board under section 10E(6) or the place of its sitting under the Regulations. These Regulations framed by the Company Law Board to regulate its own procedure are, therefore, of no assistance for decision of the controversy. It may be mentioned that the original jurisdiction to try a petition for winding up of a company continues to remain in the concerned High Court even though the original jurisdiction in respect of a petition under sections 397 and 398 is transferred to the Company Law Board. It is obvious that the appeal against an order made by the company judge of the High Court in a winding up petition continues to lie before a Division Bench of the same High Court. If the construction suggested on behalf of the respondents is correct then that High Court would have no jurisdiction to entertain an appeal against the Company Law Board's order while an appeal from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the same company, except in the case of the Delhi High Court. No such distinction between the High Courts can be envisaged. It was precisely to remove such an anomaly in respect of the orders made by the Central Government or the other authorities situate in Delhi that the amendment was made in article 226 as originally enacted in the Constitution. It is difficult to accept that, after that experience, a retrograde step was taken while enacting section 10F, as suggested by the respondents. Both sides have placed reliance on section 54 of the Foreign Exchange Regulation Act, 1973 (for short "FERA") which provides an appeal to the High Court from any decision or order of the Appellate Board constituted under the Act. An explanation has been added therein to give the meaning of the expression "High Court". The absence of a similar explanation in section 10F of the Companies Act is relied on by both sides to support the rival contentions. In our opinion, the absence of a similar explanation in section 10F does not support the respondents' contention. In the absence of provisions like sections 2(11) and 10(1)(a) of the Companies Act in the FERA, the addition of the Explanation in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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