The NCLT's authority under the Companies Act, 2013 ousted the jurisdiction of the civil court, and suppression of material facts can lead to the dismissal of an application for injunction.

SHEKHAR B. SARAF, J.

1. This is an interlocutory application praying for orders as enumerated below:

(a) An order of injunction be made restraining the defendants from giving any effect or further effect to the purported resolutions dated 15th October, 2018, 14th November, 2018 and 1st December, 2018 or from in any manner representing or holding out that the authorized capital of the defendant No. 1 company has been increased from its original authorized value of Rs.1.5 crores or that any bonus shares have been issued or allotted to the defendant Nos. 2, 3, 4 and 5 or any of them, consequent on increase of the authorized capital of the company or otherwise;

(b) An order of injunction be made restraining the defendants or any of them from issuing or allotting any share or allotting any share in the defendant No.1 or from transacting any business of the said defendant or from in any manner dealing with any of its assets or properties or from convening any meeting of the defendant No. 1 or passing any resolution thereat to deal with, dispose of, alienate, encumber or part with possession of any part or portion of the property of the defendant No. 1 at 10, Middleton Street, Kolkata - 700071;

(c) An ad interim order be made in terms of the prayers above;

(d) Costs of this application be directed to be paid by the defendants;

(e) Such further or other order or orders be made and/or direction or directions be given as to this Hon'ble Court may seem fit and proper.

2. The factual matrix of the case is that the defendants owed the plaintiffs a huge sum of money to the tune of approximately Rs. 30 crores and they had been reneging on their payments. Ultimately, defendants 2 to 5, who own the entire shareholding in the defendant no. 1 company, pledged their shareholding as security for the debt on 25th July, 2018. They failed to pay the outstanding amount and, thereafter, on 24th December, 2018, they transferred the entire shares of the company to the plaintiffs by signing on transfer deeds. It came to the plaintiffs' knowledge on a later date that the defendants had amended the memorandum of association of the company and increased the authorised share capital of the defendant no. 1 company and thereafter issued bonus shares to the defendant nos. 2 to 5. Upon enquiry it transpired that three resolutions were passed between July, 2018 and December, 2018 - first one on 15th October, 2018, another on 14th November, 2018 and the third one on 1st December, 2018. These resolutions authorised the increase in share capital, issuance of bonus shares, and allotment of the said bonus shares. The plaintiffs claimed that they had an oral agreement with the defendants whereby it was implied that no changes would be made in the shareholding of the company and, thus, the defendants committed fraud on the plaintiffs by carrying out the said changes behind their backs.

3. It was brought to light by the counsel for the defendants, Mr. Jishnu Chowdhury, that the plaintiffs had also instituted proceedings before the National Company Law Tribunal (hereinafter referred to as "NCLT") on the 15th of February and that the present interlocutory petition and the plaint before this Court does not disclose this fact. In reply to this, the counsel for the plaintiffs, Mr. Jishnu Saha, stated that he is willing to provide an undertaking to not press the interim prayers before the NCLT. Additionally, he also refers to paragraph 33 of the plaint to state that he had already disclosed that an application has been filed before the NCLT.

4. Mr. Saha further stated that the application filed before the NCLT was under Sections 58 and 59 of the Companies Act, 2013 for registration of the shares already transferred to the plaintiffs, which the defendants had refused to carry out. Further, he argued that an application for oppression and mismanagement under Sections 241 and 242 of the Companies Act, 2013 can only be made by a member of the company and since their share transfer