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TMI Blog2015 (10) TMI 2659X X X X Extracts X X X X X X X X Extracts X X X X ..... nged by way of an appeal under Order 43 Rule 1 (r) of the Code of Civil Procedure but this Revisional Application was entertained as there is no Vacation Bench sitting in the Court below for receiving the appeal and entertaining thereof. Since the litigant cannot be rendered remediless this Court proposes to entertain the instant application filed under Article 227 of the Constitution of India. 2. At the very outset this Court must record that the gist of the order enclosed with this Revisional Application appears to have been passed by the Trial Court is cryptic and does not reflect the clear state of affairs. Both the parties have not disputed the gist of the impugned order and proceeded to address this Court treating the same to have been passed by the Trial Court. 3. Bereft of unnecessary details, the Petitioners as promoters of the Opposite Party No. 2 Company claimed to have owned approximately 37% of shares. The Opposite Party No. 2 Company is engaged in the manufacture of the cotton, polyester and blended yarns and for smooth running of such business took a loan from various banks. Having faced difficulty in liquidating the loans obtained from the different banks, one tim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wful and void and perpetual junction as it appears from the plaint is prayed for restraining the Opposite Parties from taking any action in pursuance of the aforesaid transaction, more particularly the nomination of the Directors in the Board of Directors on the basis of the Share Subscription Agreement. 5. Mr. Pratap Chatterjee, learned Senior Advocate, appearing for the Petitioner, submits that Clause 28.3.3 of the Share Subscription and Shareholders' Agreement put a fetter on the part of the Opposite Party No. 1 being the investor to assign its right under the said agreement to any of its affiliates provided such affiliate shall sign the Deed of Adherence in the prescribed form and manner stated in Annexure 13.2 thereof. He put much stress upon the said clause and would contend that the Opposite Party No. 3 being not the affiliates of the Opposite Party No. 1 cannot assert any right under the said agreement. He would further contend that the act of nominating five persons as Directors in the Board of Directors under the said agreement is unlawful and void and in clear contravention thereto. He further refers the termination clause to support his contention that the agreement sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Block Deal or a negotiated trade or otherwise. He further submits that the SICA being a special statute and self contained code has a overriding effect on a general Act as held in case of Tata Motors (Supra). 7. He further placed reliance upon a judgment of the Supreme Court delivered in case of Vodafone International Holdings B.V. -Vs- Union of India and Anr. reported in (2012) 6 SCC 613 in support of his contention that the Shareholders' Agreement is a private contract which should not be contrary to the provisions of the Articles of Association. It is further stated that the control of the company vested in the voting powers of the majority shareholders and therefore the Petitioners can agitate their grievance in a domestic forum at the general meeting which is scheduled to be held in the month of December, 2015. According to him disputes allegedly raised in the instant suit are capable of being determined by BIFR exercising the jurisdiction under SICA and therefore the Civil Court has no jurisdiction to pass any injunction and placed reliance upon a judgment of the Supreme Court in case of Ghamashyam Sarda -Vs- M/s S.S. Trading Company reported in AIR 2015 Supreme Court 403. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company to any person whether by way of a block deal or a negotiated trade or otherwise. The reasonable interpretation which can be assigned to a different sub Clauses under the assignment Clause is that the right to assign the rights under the agreement can be exercised by the investor subject, however, to signing the Deed of Adherence in the prescribed form. Sub Clause 28.3.1 of the assignment Clause put a fetter on the part of the company and the promoter to assign any right or obligation under the agreement without prior consent of the investor. Sub Clause 28.3.2, from its meaningful reading does not put any restrictions on the investor to assign any of their rights under the agreement to a third party but such assignment should be followed by a Deed of Adherence strictly in terms of Annexure 13.2 thereof. Sub Clause 28.3.3 is an additional Clause which permits the investor to assign its right under the said agreement to any of its affiliates in the same manner as indicated in a proceeding Clause. On harmonious reading of the different Clauses including 13.4, there is no hesitation that the equity shares are freely transferable or assignable. 10. The Article of Association of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall not go contrary to the articles of association. The essential purpose of SHA is to make provisions for proper and effective internal management of the company. It can visualize the best interest of the company on diverse issues and can also find different ways not only for the best interest of the shareholders, but also for the company as a whole." 11. Furthermore, the person nominated by the Opposite Party No. 3 has already been appointed as a Director of the Opposite Party No. 2 Company before the institution of the suit. Form DIR-12 annexured to the Revisional Application corroborates the aforesaid facts and it is evident therefrom that such appointment was made w.e.f 23rd September, 2015. 12. There is no quarrel to the proposition of law that the temporary injunction is passed in aid of the final relief. An application for injunction is considered and decided on a well recognized three parameters, namely, existence of prima-facie case, plans of convenience and inconvenience and irreparable loss and injury. It admits no ambiguity to say that if the Court lacks inherent jurisdiction the prayer for injunction can be refused as the said order shall be a nullity. Though seve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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