Decided on April 19,1995



A.R. Ramanathan, (Member) - (1.) THIS case relates to three applications being applications Nos. 4, 5 and 6 of 1994 filed by Mrs. Bimala Mallick, Shri S. K. Mallick and Suhas Kumar Dey Mallick, respectively. The applicants seek to set aside the dismissal order dated August 17, 1993, under Regulation 26(2) of the Company Law Board Regulations, 1991 (hereinafter called the "CLB Regulations"), by which the original applications of these three applicants under Section 58A(9) of the Companies Act, 1956, were dismissed for non-prosecution. The grounds for all the three applications are that the applicants were prevented from briefing their counsel due to old age, serious illness and in the case of the third applicant, due to his residing at Allahabad and working for gain there. It is also stated that the counsel for all the three applicants, viz., Shri D.K. Bhar could not represent his clients on the date of hearing due to serious illness. THIS has also been confirmed through an affidavit signed by Shri Bhar. All the three applications were served on the respondent-company and replies and counter replies have also been filed.
(2.) It is argued by Shri S.N. Choudhury, advocate, appearing on behalf of all the three applicants that the Company Law Board has inherent power under Regulation 44 of the Company Law Board Regulations to make such orders as may be necessary for the ends of justice. He also cited three decisions of the Supreme Court, viz., Padam Sen v. State of U. P., AIR 1961 SC 218, Newabganj Sugar Mills Co. Ltd. v. Union of India, AIR 1976 SC 1152 and Jaipur Mineral Development Syndicate v. CIT [1977] 106 ITR 653 ; AIR 1977 SC 1348, to substantiate his case. It was pleaded by Shri Choudhury that though the applications were dismissed on August 17, 1993, the order in this regard was signed on December 2, 1993, and was communicated to the applicants by a letter of the Company Law Board dated December 6, 1993. Thereafter, the revival applications were filed on January 13, 1994. Thus the applications are marginally delayed by a few days for which the Bench can exercise its inherent power and condone the delay. Shri A. Banerjee, counsel for the respondent-company, based his arguments on the ground that as per the requirements of Regulation 26(2) of the Company Law Board Regulations, 1991, the applicants should have filed the restoration applications within 30 (thirty) days from the date of dismissal and should also satisfy the Bench that there was sufficient cause for non-appearance. According to him, though the dismissal was made on August 17, 1993, the revival applications were filed only on January 13, 1994, i.e., after nearly five months and hence, the applications are not maintainable. He further stated that the applicants themselves have admitted in their applications that the juniors of the applicants' advocate were present on the date of dismissal of the petition and were, therefore, aware of the dismissal on the very same day. According to Shri Banerjee, though the non-appearance due to the personal inconvenience of the applicants or their advocate on record on August 17, 1993, could be condoned, there is no ground for condoning the inordinate delay of nearly five months in filing the revival applications. According to him, his client, therefore, should not be denied the benefit arising out of the default of the applicants.
(3.) THE pleadings and arguments were carefully considered. THE stakes involved in this case are very substantial. THE findings of the Supreme Court, in the three cases cited by the learned advocate for the applicants, in substance are as follows : Padam Sen v. State of U. P., AIR 1961 SC 218, 219 : "THE inherent powers saved by Section 151 of the Code are with respect to the procedure to be followed by the court in deciding the case before it.";

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.