2014 (6) TMI 644

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..... gi and others Vs. M/s Shree Jagdish Cement Pvt. Ltd. and others. The petition before the Company Law Board was filed under Sections 397 and 398 of the Act complaining about the oppression and mismanagement of the company M/s Shree Jagdish Cement Pvt. Ltd. The company petition was allowed with certain directions. In challenging the above order apart from merits it has been argued that the impugned order passed by the Company Law Board stand vitiated in law for want of notice under Section 400 of the Act to the Central Government. The appellants have taken specific ground to this effect in the second supplementary memo of appeal to which the respondents have replied contending that no such objection was taken by the appellants before the C .....

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..... ment so that all difficulties with regard to Section 400 of the Act are obviated. The Division Bench clarified that if the court does not summarily dismissed the petition and admits it or accepts it otherwise than the office will immediately issue notice to the Central Government and the petition will come up for hearing after the central government has been served. The aforesaid decision reveals that ordinarily the practice is to effect service of notice upon central government in dealing with a petition under Section 397 or 398 of the Act once it is entertained. In Cosmosteels Private Ltd. and others Vs. Jairam Das Gupta and others AIR 1978 Supreme Court 375, three Judges Bench of the Supreme Court in paragraph 14 clearly laid down that .....

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..... of the Act except for its summary dismissal, without giving notice to the Central Government as contemplated vide Section 400 of the Act. The decision of the learned single Judge of the Madhya Pradesh High Court in the case of Marble City Hospital and Research Center (P) Ltd. Vs. Sarabjeet Singh Mokha (2010) 6 Comp. LJ 345 (MP) that the non issuance of notice under Section 400 of the Act would not be fatal to vitiate the proceedings as there is no provision which provides for the effect of non issuance of the notice to the Central Government would not be of any help to the petitioners as it fails to take into account the ratio of the decision of the Supreme Court in Cosmosteels Private Ltd. (Supra). In the instant case there is nothing i .....

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