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1975 Supreme(Mad) 168

High Court of Judicature at Madras
THE HONOURABLE CHIEF JUSTICE MR. K. VEERASWAMI, THE HONOURABLE MR. JUSTICE NATARAJAN & THE HONOURABLE MR. JUSTICE MOHAN
Century Flour Mills Limited and Another - Appellant
Versus
S. Suppiah and Another - Respondent
Case No : Civil Misc. Petition No. 10347, 10935, 13855 and 13856 of 1974 in O. S. A. No. 64 of 1974
Decided On : 11 March 1975

Advocates Appeared:N. Panchapagesa Iyer, Anand Dasgupta, Sagar, S. Govind Swaminathan, Advocates.

Judgment :-

VEERASWAMI C.J.

An extraordinary general body meeting of the shareholders of the Century Flour Mills Ltd., Madras, was fixed for September 14, 1974. The appellants in the original side appeal had applied under section 186 of the Companies Act for naming an advocate-chairman, and fixing the venue of the meeting. Though it was contended that the court had no power to appoint an advocate-chairman, the learned judge sitting on the company side declined to appoint an advocate on the ground that there was no need therefor. The appeal is from that order. Pending the appeal, a Division Bench of this court by an order dated September 12, 1974, on a relative application directed

"that the convening of the general body meeting of the respondent herein on September 14, 1974, be and is hereby stayed pending further orders on this petition" *

. A certified copy of this order, as we find from the record of evidence, was served at the registered office of the company on September 13, 1974. Nevertheless, the meeting as notified was allowed to take place the next day. An application for contempt was taken out in consequence against one of the managing directors and another. But, on their tendering apology, which the Division Bench accepted since it was unqualified, the contempt petition was closed. C.M.P. No. 10935 of 1974 has been taken out in the form of a judge's summons under rule 9 of the Companies (Court) Rules, 1959, read with section 151 of the Code of Civil Procedure, to declare as void, illegal and inoperative the resolutions passed at the meeting of September 14, 1974. On the other hand, an application has been taken out by the respondents to dismiss the appeal itself on the ground that it has become infructuous since the meeting had already taken place. In the first instance, these matters were heard by a Division Bench, to which two of us were parties, but because of one or two decisions of this court rendered by Division Benches, it was considered necessary to refer the matters to a fuller Bench and that is how these matters have come before us.The only question for decision in these matters is whether the resolutions passed at the meeting on September 14, 1974, can validly stand, notwithstanding the fact that the meeting was held in violation of the inhibitory order aforesaid. What the appellants contend is that, since the meeting was held in violation of the inhibitory order, no wrong doer in respect thereof should be allowed to derive any benefit out of his own wrong. Alternatively, it is also put that in exercise of the inherent powers of this court under section 151 of the Code of Civil Procedure, this court should, in such circumstances, and in order to meet the ends of justice, put back the parties in the same position as they had been immediately before the order staying the proposed meeting was issued. We shall first examine whether in such circumstances this court can invoke its inherent power under section 151 of the Code of Civil Procedure.

Since the matter is not res integra, the best way to approach the question is to refer to the decided cases and in the light of it, to come to a conclusion. Cases are all agreed that, whether it is a stay order, or an injunction, essentially, there is no difference between them except that in the case of stay order, it is addressed to the court concerned, and in the other to the person inhibited from doing a certain thing. There is also no difference that, so far as Order XXXIX of the Code of Civil Procedure is concerned, it confers only limited powers and would not be of assistance in circumstances as in the present case. In Mulraj v. Murti Raghunathji the Supreme Court observed :

"As we have already indicated, an order of stay is as much a prohibitory order as an injunction order and unless the court to which it is addressed has knowledge of it, it cannot deprive that court of the jurisdiction to proceed with the execution before it. But there is one difference between an













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