IN RE: BIRLA CORPORATION LTD. Vs. STATE

JUDGEMENT

(1.) C .A. No. 567 of 2008 in C.P. No. 57 of 2004 filed by the twenty -fifth respondent was mentioned on October 15, 2008, seeking for various interim reliefs. After hearing counsel, I passed the following order: "Application mentioned. Counsel appearing for the respondents seek time to file a reply. To be done by October 25, 2008 and rejoinder by November 2, 2008. The application will be heard on November 2, 2008, at 2.30 p.m. In the meanwhile, there shall be no board meeting in any of the respondent -companies except that for the purpose of approving quarterly results, board meeting may be held, if required". This order was taken on an appeal before the Kolkata High Court, which by an order dated October 24, 2008, set aside the said order on the ground that the order was bereft of reasons. The High Court also directed that this Board should proceed to hear out the said application on November 5, 2008, without granting adjournment to any of the parties. While, doing so, the court also had directed the parties to maintain status quo in regard to the composition of the board. On an application by one of the respondents seeking for certain clarifications of the order of the High Court dated October 24, 2008, by an order dated November 4, 2008, while clarifying its earlier order, the High Court also gave liberty to the parties to raise all points before this Board.

(2.) THE application was heard on November 5, 2008. Shri Arvind Datar, senior advocate, appearing for the first respondent submitted: Before entering into the merits of the application, its maintainability should be decided first as this application is not maintainable for various reasons. The applicant is not a petitioner in C.P. No. 57 of 2004. It is the twenty -fifth respondent. It has no personal interest in regard to the relief sought for in the application. In terms of Section 41(j) of the Specific Relief Act, 1963, injunction cannot be granted if the applicant has no personal interest in the matter. When there are five petitioners in C.P. No. 57 of 2004 and when none of the petitioners has chosen to file the interim application, the twenty -fifth respondent could not have filed this application. The main relief sought in the application is that the board of directors should not appoint a chairman in the place of Shri Lodha who had expired recently. When article 151 of the articles of association of the company authorises the board to appoint a chairman, no shareholder can seek injunction against such appointment. Even though, in terms of Section 403, any party can make an application, in doing so, the twenty -fifth respondent should have pleaded that the petitioners are not interested but in a representative capacity it has filed this application. There is no such averment in the application. Further, the holding of twenty -fifth respondent in the first respondent in only 280 shares constituting less than 0.0003 per cent, of the paid -up capital of the company. It has no shares in any other respondent -companies and as such has no locus standi to seek any relief against the other companies. The twenty -fifth respondent, the applicant herein, has filed an affidavit earlier seeking for dismissal of the petition and as such it cannot seek any relief in aid of the petition. Even though, it has filed C.A. No. 260 of 2006 seeking for withdrawal of the earlier affidavit, yet, that application is still pending. Similarly, its application for transposition as a petitioner is also pending. Unless these two applications are decided, it has no locus to file this application. Further, the affidavit accompanying the application has been signed by one Shri Yashwant Mishra in his capacity as finance officer and constituted attorney of the twenty -fifth respondent. No board resolution of the twenty -fifth respondent nor a copy of the power of attorney has been annexed with the application. Therefore, this application is not maintainable and as such should be dismissed at the threshold.

(3.) SHRI Pratap Chatterjee, senior advocate, appearing for respondents Nos. 3, 5, 7 and 8 submitted: The applicant has earlier supported the other respondents and had actually filed an affidavit on February 7, 2005, seeking for dismissal of the petition itself asserting that there was no mismanagement in the affairs of the company. Further, while seeking for withdrawal of the earlier affidavit, by an application C.A. No. 260 of 2006, it had sought for similar reliefs as in the present application and the same was not considered by this Board and the said application is still pending. When the earlier application is pending, the question of filing another application seeking for similar relief does not arise. As on date, the only admitted affidavit of the applicant that is on record is the one dated February 7, 2005 and having taken a stand that the petition itself is not maintainable, the applicant cannot now take a completely contradictory stand. In Indira Rao v. Westcoast Paper Mills Ltd., [1989] 1 Kar. LJ 406, the Karnataka High Court has observed: "If the parties have taken up a particular position before the court at one stage of the litigation, it is not open to them to approbate and reprobate and to resile from that position. It is an elementary rule that a party litigant cannot be permitted to assume inconsistent position in court, to play fast and lose, to blow hot and cold, to approbate and reprobate to the detriment of his opponent". In the present case, since the applicant has already taken a stand and unless and until its application C.A. No. 260 is allowed, it cannot be allowed to change its earlier stand. Further, in Smt. Isabella Johnson v. M.A. Susai , the Supreme Court has held that the party cannot be allowed to approbate or reprobate and he is estopped by way of pleading to take up inconsistent plea regarding jurisdiction. This decision shows that even, in regard to jurisdiction, a party cannot take an inconsistent stand. In the present case, having sought for dismissal of the petition, the applicant cannot now seek relief in aid of the petition. Thus, the applicant has absolutely no locus to prosecute this application and therefore the application should be dismissed at threshold. Further, the respondents have already questioned the maintainability of the petition in terms of Section 399 and the Board has kept this application to be heard along with petition. In T.K. Lathika v. Seth Karsandas Jamnadas , in paragraph 9, the Supreme Court has held that when the issue of maintainability is pending, no issue on merit should be considered. Therefore, the maintainability of the application should be first decided before considering the reliefs sought for in the application.