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TMI Blog2006 (2) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... present appellants-S.L.M. Industries Limited. The petitions remain pending for some time and when the matters came up at the admission stage, the parties were heard and by the impugned Order dated 12-9-2002 passed, in Company Petition No. 131 of 1989 and the connected group matters, the Company Court, without admitting the petitions, taking into consideration the Board s opinion formed under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985 (for short SICA ) straightway allowed the Company Petitions, directed winding up of the appellant-Company and also appointed an Official Liquidator to take possession of the properties of the Company. Being aggrieved by the said order, directing winding up of the Company, the appellant-Company is before this Court with twofold submissions. 4. Mr. R. S. Sanjanwala, learned Counsel for the appellants, submits that as the Board, constituted under the provisions of the SICA, has forwarded its opinion to the High Court of Bombay, then, the Bombay High Court only could have jurisdiction to pass orders after taking into consideration the Board s opinion. The submission is that during the pendency of these Company Peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Company Petition is required to be filed in a Court within whose jurisdiction the registered Office of the Company is situate. Section 10 of the Companies Act reads as under : " 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 being the jurisdiction conferred ( a )in respect of companies generally, by sections 237, 391, 394, 395 and 397 to 407, both inclusive; ( b )i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 18, the Board is authorised to prepare and sanction some Scheme for revival of the Company or so. Once such a Scheme is sanctioned, then, under section 19, the Board still has jurisdiction and authority to issue directions to some of the financial institutions to provide financial assistance. Under section 20, the Board is authorised to record its opinion that it would be just, proper and equitable to direct winding up of the Company. After recording such an opinion, it shall forward the opinion to the concerned High Court. Though the word "High Court" has not been defined in the SICA, but, sub-section (2) of section 3 provides that the words and expressions used and not defined in this Act shall have the meanings, if any, respectively assigned to them in the Companies Act, 1956 (1 of 1956). For appreciating which would be the concerned High Court, we will have to adopt the definition from the Companies Act and in relation to the jurisdiction, we again will have to refer to section 10 of the Companies Act. Clause ( b ) of sub-section (2) of section 3 of the SICA further provides that the words and expressions used but not defined either in the SICA or in the Companies Act, 1956, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uding the Company, or anybody at the instance of the Company, including the beneficiary or an employee, challenged the Board s opinion before the competent Court, to this Mr. Sanjanwala submitted that to the best of his knowledge, nobody has challenged the Board s opinion before any competent Court and the Company itself has not taken an exception to the Board s opinion. 13. From the order of the learned Single Judge, it appears that in light of the concession made before him and the Board s opinion, which was not challenged by anybody, instead of admitting the matters, he proceeded to pass an order of winding up of the Company. 14. In our considered opinion, change of the office/change of the registered office of the Company during the pendency of the Company Petitions, would not oust the jurisdiction of the High Court, which had the jurisdiction to entertain the matter at the time of institution of the Company Petitions. If simple change of registered office of the Company would decide the jurisdiction of the Company Court, then, it is likely to create a havoc and would give a handle in the hands of the Company. Before the matters are finally heard or are admitted, the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rojecting himself to be a creditor in connivance or collusion with the Company. A possibility of a collusive petition cannot be ruled out in a case where the Company is unable to discharge its debts. At the same time, a running Company, which can survive its life, is required to be protected from the onslaught made by the unscrupulous people. Rule 96 directs that the matter be heard by the learned Company Judge and if it is admitted, then, the hearing is to be advertised, then, such direction contained in rule 96 cannot be ignored. 17 In our opinion, the learned Single Judge, though was absolutely justified in observing that it had jurisdiction to entertain the petitions and pass an order of winding up, went a little wrong in passing the final winding up order without admitting the petitions. The direction of winding up, for the reasons stated above, deserves to and is accordingly quashed. Instead, we direct admission of all the company petitions and further direct that the date of hearing be advertised and the matters may be heard by the learned Single Judge after giving due opportunity to the parties. As the petitions are of the year 1989, we hereby direct the Registry to p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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