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TMI Blog1975 (12) TMI 186X X X X Extracts X X X X X X X X Extracts X X X X ..... y be stated as follows : -- On January 4, 1974, the opposite party filed a Title Suit No. 2 of 1974 in the Court of the Munsif, Durgapur against the petitioner on the allegation that keeping in dark the opposite party and/or its other Directors, the petitioner though a permanent Director of the opposite party company carried on business of supply of spare parts and other materials in violation of Section 299 of the Companies Act, 1956, and by reason thereof the petitioner became disqualified to hold the office of the Director of the opposite party company. It was alleged that on December 3, 1973 Shri P. K. Basu, another Director of the opposite party company, learnt the said fact. It was further alleged that the nineteenth meet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to the effect that a decree for perpetual injunction be passed restraining the defendant from acting or attempting to acts as Director of the plaintiff company and from interfering, intermeddling with the plaintiff company's affairs. Long after the institution of the suit the petitioner came to know about the filing of such a suit against him, appeared in the suit and filed an application challenging the jurisdiction of the Court. It was submitted that the plaintiff has based its right and/or claim in the suit under the provisions of the Companies Act, 1958. The company and its Directors being creature of the said Companies Act, the plaintiff was not entitled to any relief in the suit on the basis of any common law right. The learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the company unless specifically empowered by the Board of Directors and any unauthorised act of a Director does not bind the company. In the scheme of the Act provision for declaration and permanent injunction against a Director on the ground of breach of Section 299(i) of the Companies Act was wholly unnecessary. Mr. Ray further contends that the learned Munsif ought to have appreciated that whatever remedy and/or steps necessary in case of breach of Section 299(i) of the Companies Act, 1956 have been provided fully and adequately in sections 299 and 203 of the said Act. 2. Mr. Ray first of all refers to Section 299 (1) of the Act which reads as follows : -- Every director of a company who is in any way whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny with effect from January 29, 1972, that is exactly the resolution of December 28, 1973. By the said resolution it must be deemed that the defendant has vacated the office of the Director of the company. It is again not understood what was the necessity for the plaintiff to get a declaration from a Civil Court that a resolution passed by the company is binding on the defendant and that on the basis of the said resolution it should be held that the defendant had vacated the office of the Director. The third declaration sought for was that the defendant had no manner or right, title and interest to act as Director of the company. If there was such a resolution and if there was a contravention of Section 299 the office of the Director has au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the First Class or, as the case may be, a Presidency Magistrate, having jurisdiction to try such office. Mr. Ray also refers to Section 10 of the Act which lays down as to which are the courts which have jurisdiction under the Companies Act. From Section 10 it is seen, that mainly the High Court has jurisdiction with regard to the matters under the companies Act. In certain cases the District Court may have jurisdiction and the Central Government by notification may empower any District Court to exercise all or any of the jurisdiction with regard to certain matters. Mr. Ray also refers to the relevant notification and from that we find that only with regard to certain sections, the District Courts have been empowered but Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rial dispute. Their Lordships held that if the dispute is not an industrial dispute, nor does it relate to enforcement of any other right under the Act, the remedy lies only in the Civil Court . It was further held that if the industrial dispute relates to the enforcement of a right or an obligation created under the Act then the only remedy available to the suitor is to get an adjudication under the Act . 6. The learned Advocate appearing on behalf of the opposite party submits that for the alleged acts done by the petitioner there is no remedy under the Companies Act and that being so, it must be held that the Civil Court is quite competent to enter in the suit. Provisions of the Companies Act have already been referred to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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