BAKHTAWAR CONSTRUCTION CO PVT LTD Vs. BLOSSOM BREWERIES LTD

JUDGEMENT

(1.) THE applicant herein, namely, Bakhtawar Construction Company Limited, had filed a petition under Section 248/250 of the Companies Act, 1956, in Blossom Breweries Limited., In re. We dismissed this petition as not maintainable, vide our order dated November 12, 1997 (see [1998] 95 Comp Cas 28). THE applicant then filed an appeal against this order in the High Court of Bombay and the said High Court, while setting aside our order, has remitted the same back to us for considering the petition on the merits. In the said order, the High Court has also directed that we should consider the application for interim relief filed by the applicant (see [1998] 95 Comp Cas 28).

(2.) The applicant had filed an application C. A. No. 133 of 1997, dated April 24, 1997, seeking interim reliefs as sought for in the petition. The interim reliefs sought for in the petition are more or less on the same lines as provided under Section 250(2). However, when the matter was heard as per the directions of the High Court, the applicant sought for restraining the company from registering any shares allotted as promoters' quota, on the ground that the lock-in period in respect of these shares was coming to an end on May 25, 1998.

(3.) DR. Singhvi, senior advocate, appearing for the applicant submitted that the applicant has come before the Company Law Board in pursuance of the directions of the Bombay High Court which has, in the last para, of the order, directed the Company Law Board to consider the interim prayer. According to him, even though there is no specific provision either in Section 248 or Section 250(1) for grant of interim relief pending an order of investigation, in the absence of any specific fetter or prohibition to grant interim relief, it should be presumed that a judicial body will have the powers to grant interim relief to meet the ends of justice. He further submitted that one has to go by the purpose and objective of the provisions of a statute and as long as the interim relief sought is within the objective, then even in the absence of a specific provision, a judicial body is empowered to grant interim relief. According to him the interpretation of the provisions of the statute should be with a purpose to avoid the final relief becoming infructuous. Relying on ITO v. Mohamad Kunhi (M.K.) [1969] 71 ITR 815 (SC) and also on Gujarat Maritime Board v. Haji Daud Haji Harun Abu [1996] JT 11 SC 43 ; [1997] 89 Comp Cas 710, he submitted that the Supreme Court has held in the first case that even in the absence of any specific power of stay granted to the ITAT, the same should be treated as available to the Tribunal as an incidental and ancillary power to its jurisdiction. In the second case he pointed out that the Supreme Court has held that, where a substantive power is conferred on a court or Tribunal, all incidental and ancillary powers necessary for an effective exercise of the substantive power have to be inferred. Even otherwise, according to him, as per regulation 44 of the Company Law Board Regulations, the Company Law Board has inherent powers to make such orders as may be necessary to meet the ends of justice. Relying on the judgment of the Company Law Board in Gammon India Ltd., In re [1990] 3 Comp LJ 89 , he submitted that, in this case, the Company Law Board has recognised its powers to grant interim relief in a proceeding under Section 247/248/250, and therefore, the question of re-examining the issue as to whether it has the power to do so does not arise.