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IN the HIGH COURT at CALCUTTA the Hon'ble the Chief Justice IN THE HIGH COURT AT CALCUTTA Civil Appellate Jurisdiction Original Side Present: The Hon’ble The Chief Justice Jyotirmay Bhattacharya And The Hon’ble Justice Shekhar B. Saraf APO 112 of 2017 ACO 48 of 2017 CA 563 of 2013 CC 43 of 2014 CP 611 of 1988 Prasanta Kumar Mitra & Ors. Versus India Steam Laundry (P) Ltd. & Ors. For the appellants : Mr. S. Pal, Sr. Advocate, Mr. Raj Ratan Sen, Advocate, Mr. Gautam Kumar Ray, Advocate. For the respondents : Mr. S. B. Mookherjee, Sr. Advocate, Ms. Roopa Mitra, Advocate For Respondent no. 3 Mr. Jayanta Kumar Mitra, Sr. Advocate, Mr. Soumitra Dutta, Advocate For Respondent no. 4 Mr. Joydip Kar, Sr. Advocate, Mr. Sirsanya Bandopadhyay, Advocate For Respondent no. 16 & 17 Mr. Joy Saha, Advocate, Mr. Subhojit Saha, Advocate For Respondent No. 13, 14 and 15 Heard on : 26/10/2017, 27/11/2017, 06/12/2017, 08/12/2017, 03/01/2018, 10/01/2018, 11/01/2018, 17/01/2018, 19/01/2018, 25/01/2018, 02/02/2018, 17/05/2018, 21/06/2018, 22/06/2018, 28/06/2018, 05/07/2018 Judgment on: September 5, 2018 Shekhar B. Saraf, J. : 1. This is an application arising out of an appeal in connection with a judgment passed by the Learned Single Judge on March 22, 2017 in the matter of Prasanta Kumar Mitra and Ors. –v- India Steam Laundry (P) Limited and Ors. (in C.A. 563 of 2013 with C.P. 611 of 1988; C.C 43 of 2014). The company petition above relates to mismanagement and oppression under sections 397 and 398 of the Companies Act, 1956 (hereinafter referred to as “the 1956 Act”). By the said order, the Single Judge held that from 15th December, 2016, the High Court had lost jurisdiction to hear and dispose of the above proceedings in the High Court and the same stood transferred to the National Company Law Tribunal (hereinafter referred to as ‘NCLT’). Factual Background 2. The facts leading to this application and appeal are as follows: - a. The Companies Act, 1956 came into force on April 1st, 1956. b. The Companies (Amendment) Act, 1988 (hereinafter referred to as “Amendment Act, 1988”) came into force on May 31, 1991. From this day onwards, several matters including matters relating to mismanagement and oppression (Section 397 to 405 of the 1956 Act) were transferred to the Company Law Board. c. The Amendment Act, 1988 had a provision being Section 68 that retained matters and proceedings that were pending before the High Court prior to coming into force of the Amendment Act, 1988. The relevant section is set out below: “Section 68: (1) Any matter or proceeding which, immediately before the commencement of the Companies (Amendment) Act, 1988 was pending before any Court shall, notwithstanding that such matter or proceeding would be heard by the Company Law Board after such commencement, be continued and disposed of by that court after such commencement in accordance with the provisions of the Principal Act as they stood immediately before such commencement. (2) Any matter or proceeding which immediately before the commencement of the Companies (Amendment) Act, 1988, was pending before the Company Law Board by virtue of any notification issued by the Central Government shall, unless such matter or proceeding would be heard by the Company Law Board after such commencement, be heard and disposed of by the Central Government.” d. The Companies Bill, 2011 was introduced in Parliament on December 2, 2011. The Notes on Clauses to the said bill explained two provisions of the bill including that of clause 434, which dealt with transfer of proceedings from various forums to the proposed tribunal. The said clause is set out below: “Clause 434: This Clause corresponds to sections 10F and 647A of the Companies Act, 1956 and seeks to provide that on foundation of Tribunal, all matters pending before CLB shall stand transferred to the Tribunal. Similarly, all proceedings relating to compromise, arrangements and reconstruction and winding up of the companies pending before District Court and High Courts shall be transferred to the Tribunal except winding up proceedings pending before District Courts or High Courts.” e. On June 1, 2016 the NCLT was notified and came into existence. Further, sub-section 1(a) and 1(b) of Section 434 of the Companies Act, 2013 (hereinafter referred to as “the 2013 Act”) were also notified on the date mentioned above. f. On December 7, 2016, Clause (c) of sub-section (1) of Section 434 of the 2013 Act was notified with effect from December 16, 2016. Section 434 of the 2013 Act is provided below: “434. Transfer of certain pending proceedings.-(1) On such date as may be notified by the Central Government in this behalf,- (a) all matters, proceedings or cases pending before the Board of Company Law Administration (herein in this section referred to as the Company Law Board) constituted under sub-section (1) of section 10-E of the Companies Act, 1956 (1 of 1956), immediately before such date shall stand transferred to the Tribunal and the Tribunal shall dispose of such matters, proceedings or cases in accordance with the provisions of this Act; (b) any person aggrieved by any decision or order of the Company Law Board made before such date may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the Company Law Board to him on any question of law arising out of such order: Provided that the High Court may if it is satisfied that the appellant was prevented by sufficient cause from filing an appeal within the said period, allow it to be filed within a further period not exceeding sixty days; (c) all proceedings under the Companies Act, 1956 (1 of 1956), including proceedings relating to arbitration, compromise, arrangements and reconstruction and winding up of companies, pending immediately before such date before any District Court or High Court, shall stand transferred to the Tribunal and the Tribunal may proceed to deal with such proceedings from the stage before their transfer. (d) any appeal preferred to the Appellate Authority for Industrial and Financial Reconstruction or any reference made or inquiry pending to or before the Board of Industrial and Financial Reconstruction or any proceeding of whatever nature pending before the Appellate Authority for Industrial and Financial Reconstruction or the Board for Industrial and Financial Reconstruction under the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986) immediately before the commencement of this Act shall stand abated: Provided that a company in respect of which such appeal or reference or inquiry stands abated under this clause may make a reference to the Tribunal under this Act within one hundred and eighty days from the commencement of this Act in accordance with the provisions of this Act: Provided further that no fees shall be payable for making such reference under this Act by a company whose appeal or reference or inquiry stands abated under this clause. (2) The Central Government may make rules consistent with the provisions of this Act to ensure timely transfer of all matters, proceedings or cases pending before the Company Law Board or the Court, to the Tribunal under this section.” g. Further, on 7th December 2016 the Companies (Transfer of Pending Proceedings) Rules, 2016 and the Companies (Removal of Difficulties) Order, 2016 formulated under Section 470 of the 2013 Act were also notified. The said Order is provided below: “In the Companies Act, 2013, in Section 434, in sub-Section (1), in Clause (c), after the proviso, the following provisos shall be inserted, namely;- ‘Provided further that only such proceedings relating to cases other than winding up, for which orders for allowing or otherwise of the proceedings are not reserved by the High Courts shall be transferred to the Tribunal: Provided further that- (i) All proceedings under the Companies Act, 1956 other than the cases relating to winding up of companies that are reserved for orders for allowing or otherwise such proceedings; or (ii) The proceedings relating to winding up of companies which have not been transferred from the High Courts; Shall be dealt with in accordance with provisions of the Companies Act, 1956 and the Companies (Court) Rules, 1959’.” h. The Single Judge held that all the matters should be transferred to NCLT as per the 7th December, 2016 notification under the 2013 Act, holding that Section 434 of the 2013 Act had impliedly repealed the transitional provision brought in by the Amendment Act, 1988. The relevant portion of the order is delineated below: “25. Mr. Sen contended that the Court will be slow to hold that an earlier statute or a provision thereof has been impliedly repealed by a subsequent statute or a provision thereof. In this connection, learned Senior Counsel relied on the Apex Court decisions in Union of India-vs.- Venkateshan S. (supra) and Lal Shah Baba Dargah Trust-vs.- Magnum Developers (supra). As a proposition of law there cannot be any dispute with such contention. Where a subsequent statute does not expressly repeal a previous statute covering the same field, to the best extent possible, the courts will endeavour to give effect to both the statutes by resorting to the principle of harmonious construction. However, when the words of the later statute are crystal clear leaving no scope for confusion and if such words cannot under any circumstances be construed harmoniously with the words of the previous statute, the earlier statute must be held to have been impliedly repealed. Where the earlier and the later provisions of law cannot stand together, where the words of the two enactments are absolutely irreconcilable, where the two provisions of law are plainly repugnant to each other, the earlier law would stand abrogated by the later law.
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