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2019 Supreme(Mad) 1784
IN THE HIGH COURT OF JUDICATURE AT MADRAS
S. MANIKUMAR, SUBRAMONIUM PRASAD, JJ.
Spicejet Limited and Others – Petitioners
Versus
Credit Suisse AG, a Stock Corporation and Others – Respondents
O.S.A. Nos. 287 of 2017, 477, 478, 479 of 2018, C.M.P. Nos. 18177 of 2017, 225885, 22886, 22889, 22902 of 2018
Decided On : 05-08-2019
Advocate Appeared:
For the Petitioners: Ramakrishnan Veeraraghavan, P.S. Raman.
For the Respondents: Ashok Menon, Rahul Balaji, R. Parthasarathy, Robin, R. David, Dhiraj Philip, M/s. Paul & Paul J. Hudson Samuel.
Headnote:
Companies Act, 1956 - Section 483 - Constitution of India - Article 141 –Removed from service - Transfer of certain pending proceedings – Condo nation of delay - 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 – Held, We have to bear in mind two maxims of equity which are well settled, namely, actus curiae neminem gravabit - An act of the Court shall prejudice no man. In Brooms Legal Maxims, 10th Edn. 1939 at Page 73 this maxim is explained that this maxim was founded upon justice and good sense and afforded a safe and certain guide for the administration of the law. The above maxim should, however, be applied with caution. The other maxim is lex non cogit ad impossibilia (Brooms Legal Maxims - Page 162). The law does not compel a man to do that which he cannot possibly perform. The law itself and the administration of it, said Sir W. Scott, with reference to an alleged infraction of the revenue laws, must yield to that to which everything must bend, to necessity the law, in its most positive and peremptory injunctions, is understood to disclaim, as it does in its general aphorisms, all intention of compelling impossibilities, and the administration of laws must adopt that general exception in the consideration of all particular cases - After the judgment impugned herein was passed, all the cases relating to petitions for winding up of companies under sub-clause (e) of Section 433, on the ground of inability to pay debts were transferred to National Company Law Tribunal (NCLT). In those cases where orders for stay were not obtained from this Court, the NCLT has proceeded under the Insolvency and Bankruptcy Code, 2016. To transfer those cases, where NCLT has proceeded in the absence of any stay order from this Court wherein Insolvency Resolutions Professionals have been appointed, Corporate Insolvency Resolution process have begun, Resolution plans have been submitted, Resolution plans have been approved, or Liquidation process have begun or are under challenge before the National Company Law Appellate Tribunal (NCLAT), back to this Court would cause prejudice to the parties - We are of the view that Rules 26 and 27 clearly refer to a pre-admission scenario as is clear from a plain reading of Rules 26 and 27, which make it clear that the notice contained in Form No. 6 has to be served in not less than 14 days before the date of hearing. Hence, the expression “was admitted” in Form No. 6 only means that notice has been issued in the winding up petition which is then “fixed for hearing before the Company Judge” on a certain day. Thus, the Madras High Court view is plainly incorrect whereas the Bombay High Court view is correct in law – Order accordingly
JUDGMENT :
SUBRAMONIUM PRASAD, J.
Prayer: Original Side Appeal filed under Section 483 of Companies Act, 1956 read with Clause 15 of Letters Patent against the order dated 07.09.2017 passed by the learned Single Judge in CP No. 363 of 2015.
Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent against the order dated 11.01.2017 passed by the learned Single Judge in CP No. 14 of 2015.
Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent against the order dated 18.08.2017 passed by the learned Single Judge in CP No. 172 of 2011.
Original Side Appeal filed under Order XXXVI Rule 1 of Original Side Rules read with Clause 15 of Letters Patent against the order dated 11.01.2017 passed by the learned Single Judge in CP No. 14 of 2015.
1. Judgments and orders passed by learned Single Judge of this Court in CP No. 14 of 2015 dated 11.01.2017, CP No. 172 of 2011 dated 18.08.2017 and CP No. 363 of 2015 dated 07.09.2017, has been challenged in OSA Nos. 477 & 479 of 2018, 478 of 2018 and 287 of 2017, respectively.
2. The question which arises for consideration is the scope and ambit of Rule 5 of the Companies (Transfer of Pending Proceedings) Rules, 2016, Companies (Removal of Difficulties) Fourth Order, 2016, and Rule 5 of the Companies (Transfer of Pending Proceedings) Second Amendment, Rules, 2017. The Companies Act, 1956, was amended by the Central Act, 18 of 2013. Section 434 of the amended Act reads as under:
"434. Transfer of certain pending proceedings:-
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 10E 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 m
