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TMI Blog2015 (5) TMI 325X X X X Extracts X X X X X X X X Extracts X X X X ..... hile referring to Order XLVII of the Code of Civil Procedure. On a cursory glance and a combined reading, everyone would agree, the scope to reopen the issue by the same Bench would be little difficult. Keeping in such mind set, let us now try to understand what the petitioner would seek in the application for review. The appeal would relate to an order passed in C.P. 33 of 1988 whereby the learned Single Judge dismissed the application of the appellant on the ground, the appellant did not have requisite shareholding although, the appellant would contend, its 50 per cent shareholding could not be ignored merely because the same was attached by the Income Tax Department. On being aggrieved, the applicant approached the Division Bench, the Division Bench, however, did not entertain the appeal and disposed of the same vide order dated September 29, 2003 holding it as infractuous in view of a settlement, that the applicant did not recognize. The applicant would contend, he was the Chairman of the Hungerford Investment Trust Limited. In his absence, the Division Bench could not have passed the said order. The applicant filed the Special Leave Petition as against the order dated Septem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreement the 49 per cent of the shares in 'TML' were sold and transferred to 'Mundhra' and his nominee British Indian Corporation. Thereafter a suit for specific performance of contract being suit no.600 of 1961 was filed by 'Mundhra' against 'Hungerford', 'TML' and others in the Original Side of this Hon'ble Court praying inter alia for specific performance of the agreement to sell the 51 per cent shares. 'Mundhra' however, ultimately did not proceed against 'TML' and the said suit was decreed against 'Hungerford'. The decree provided that the agreement relating to the sale of 50 per cent ordinary shares of 'TML' ought to be specifically performed and directed 'Hungerford' to deliver to 'Mundhra' the 50 per cent shares against payment of the consideration of Rs. 86,60,000/-. An injunction was also obtained restraining 'Hungerford' and other defandants in the suit from casting vote without instruction of 'Mundhra' and restraining 'Hungerford' from selling the shares to any person other than 'Mundhra'. 3. Against that decree 'Hungerford' preferred an appeal but did not proceed with the same ultimately. As a result the appeal was dismissed for non-prosecution. On 30th August, 1965 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court that after the shares were taken by 'Mundhra' on payment of the price in terms of the direction of the Court of appeal the lien if any, as claimed by 'TML' would shift on to money which the receiver may not recover from 'Mundhra'. Against the said order 'TML' preferred appeal and also made an application for stay of the order. Ultimately the stay was refused but the appeal was partly allowed on September 2, 1968 by setting aside the direction given to the receiver to tender shares to 'Mundhra' as also the direction that the lien of 'TML' would shift to the purchase money to be paid by 'Mundhra'. Further on March 21, 1967 'Hungerford' made an application praying that agreement dated October 30, 1956 and the decree dated February 25, 1964 passed in suit no.600 of 1961 be rescinded, that the injunction granted by the decree in the suit would be vacated also unless 'Mundhra' deposited Rs. 86,60,000/- in Court or with the receiver in suit no.2005 of 1965. The said application was disposed of by the Learned Single Judge with the observation that 'Mundhra' committed breach of contract which he was directed specifically to perform, therefore, the agreement dated October 30, 1956 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only issue no.1, 2, 3 and 4 which are as follows were dealt with by the Appeal Court. "1. Is the petitioner entitled to maintain this application or claim any of the relief ?" "2. Is the application maintainable in the absence of the subsidiary companies and their directors and share holders ?" "3. Whether in the facts and circumstances alleged in paragraphs 77, 92, 93(4), 93 (8) and 97 of the petition, the affairs of the respondent company no.1 were and are being conducted in a manner (a) oppressing to the petitioner or (b) prejudicial to the to the interest of respondent company no.1 or (c) in a manner prejudicial to the public interest?" "4. Are the respondents 2 to 10 guilty of (a) mis-management and (b) acts prejudicial to the interest of the affairs of the respondent company no. 1 as alleged in paragraphs 87 to 89 of the petitioner ?" 8. The said company appeal no. 274 of 1967 was disposed of by the judgment and order dated 21st May, 1981 interalia as follows:- " It is ordered that the order of trial Court dated the twenty fourth day of June in the year one thousand nine hundred and seventy be and the same is hereby set aside And it is further ordered that the affairs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccordingly." 10. Feeling aggrieved by the said order the 'TML' preferred the instant appeal being APO No.289 of 1994. Thereafter by the order dated 13th April, 1993 the Division Bench passed an order in terms of prayer 'A' of the petition and directed the 'TML' to furnish a bank guarantee for the entire amount of Rs. 12,16,350/- with any nationalised bank in favour of Registrar, Original Side. 'Hungerford' also preferred a cross appeal against the order dated 22nd February, 1994. 11. Mr. Utpal Bose, learned senior counsel appearing for the appellant contended that payment of dividends order was passed by the Single Bench but no payment order was made by the Division Bench vide Division Bench order dated 21st May, 1981. 12. Mr. Bose further vehemently contended that execution application filed on 9th May, 1983, but there was no indication in the order dated 21st May, 1981 passed by the Division Bench to make payment therefore execution application is not at all maintainable. 13. Mr. Bose further submitted that from the year 2002-2005 Justice G.N. Roy (former Supreme Court Judge) was functioning as Chairman of 'Hungerford' and from 9th May, 2005 Justice Murari Mohan Dutta (former ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nature of N.S. Hoon Chairman of 'Hungerford' and there is similar acknowledgement in the balance-sheet for the year 31st December, 1983 containing the signature of Mr. Hoon, where it is mentioned that there is no liabilities on account of the unpaid dividend. Therefore, in conclusion Mr. Bose submitted that the impugned judgment and order should be set aside by allowing the appeal. 20. Mr. Bose in respect of Section 38 and 47 of the Civil Procedure Code relied on a Supreme Court decision reported in (1996) 8 Supreme Court Cases Page-37, Para-3 (Rajasthan SRTC and Another vs Ladulal Mali) where it is held that "....It is settled law that executing Court cannot go behind the decree. In view of the fact that the decree contained only a declaratory relief without any consequential payment of monetary benefits, the executing court was right in refusing to grant the relief. The High Court was, therefore, clearly in error in directing payment of back wages". 21. On the same point Mr. Bose also relied on a Supreme Court decision reported in (2009) 2 Supreme Court Cases Page-294 Para-8 (Deepa Bhargava And Another vs Mahesh Bhargava And Others) and also a decision reported in (2009) 5 Supr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ears and if the execution application has been made within a period of 12 years it would be within the time and the executing Court can interpret a decree for payment of money as has been laid down under Section 47 of the Code of Civil Procedure. 32. Mr Hoon further vehemently urged that the non-payment of dividend by the company amounts to criminal offence under the Companies Act and therefore, Directors and Principal Officers are liable to be prosecuted and it is a settled position that such offences are continuing offences so long payment is made. Therefore there is no question of limitation as it is a continuing offence. He also urged that the judgment dated 21st May, 1981 further held that there cannot be any limitation in respect of non-payment of dividend sum amounted to continuous oppression/offences. 33. Mr. Hoon also vehemently contended that the Division Bench clearly held that withholding of dividend payable to 'Hungerford' from 1963-1965 clearly indicates a direction to make payment. Mr. Hoon further drew our attention to some passage of Division Bench order which is quoted below :- "..Therefore, the question is no longer a debatable one and it must be held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re empowered the executing Court to interpret a decree and hold that it was a decree for payment of money. In this connection Section 47 of the Code of Civil Procedure is quoted herein below :- "Section 47-Questions to be determined by the Court executing decree .-(1) All questions arising between the parties to the suit in which the decree was passed, or their representatives, and relating to the execution, discharge or satisfaction of the decree, shall be determined by the Court executing the decree and not by a separate suit." 40. From the conduct of the 'TML' it creates a doubt in our mind that it was the intention of 'TML' not to transfer the unpaid dividend in favour of the 'Hungerford'. Therefore, they prepared purported resolution dated 27th January, 1975 with the intention that in the balance sheet signed on 3rd November, 1975 with resolution dated 21st January, 1975, the Directors would not disclose the same in the balance sheet though in the auditor's report for the said year did not reflect such resolution. Therefore, from the conduct of the ''TML'' we have no hesitation to hold that the purported resolution dated 27th January, 1975 was fraudulently fabricated to depr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted by the 'TML' for which limitation is not a bar. Therefore, question of payment of dividend by the 'TML' to 'Hungerford' reached its finality by judgment of the Division Bench dated 21st May, 1981 within the same parties which was put into execution by that proceedings. 45. The decisions referred by Mr. Utpal Bose, the learned senior Counsel on the ratio that executing Court cannot go beyond the decree have no manner of application considering the aforesaid discussions that non-payment of money to the 'Hungerford' by the 'TML' towards the unpaid dividends clearly indicates that the appellant was directed by the said Division Bench order to make payment towards the unpaid dividend in respect of the specific period. Therefore, to realize the same the 'Hungerford' has no alternative/option but to put the decree in execution which in the present case has been rightly done by the 'Hungerford'. 46. With regard to limitation we find and hold that non-payment of unpaid dividend is a continuous offence committed by the 'TML' of which limitation cannot be a bar. 47. With this aforesaid discussions we hold that the impugned judgment and order passed by the Learned Trial Court is a we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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