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2023 Supreme(Mad) 839
HIGH COURT OF JUDICATURE AT MADRAS
RMT. TEEKAA RAMAN, J.
The Chairman, The Committee of Management, Chennai & Anr. - Appellants
Versus
K. Kaliyaperumal - Respondent
CMA Nos.2520 & 2521 of 2022 & CMP Nos. 19601, 19602, 19604 & 19605 of 2022
Decided On : 10-04-2023
For the Appellants:P.H. Aravind Pandian, Sr. Counsel, T. Balaji, Advocate. For the Respondent:G. Murugendran, Advocate.
The validity of election process conducted in compliance with the circulars issued by the Ministry of Corporate Affairs and the pending question of suit maintainability under Section 241 of the Companies Act.
Headnote:
Election - Mode of Conducting AGM - Companies Act, 2013, Rules 20 of the Companies (Management & Administration) Rules, 2014, General Circular No.20/2020 dated 05.05.2020, General Circular No.2/2022 dated 05.05.2022, General Circular No.11/2022 dated 28.12.2022 - Article 11, Article 19 of the Articles of Association of the Club - Section 241 of the Companies Act - OSA No.224 of 2022 - Validity of Election - Suit Maintainability
Fact of the Case:
The respondent filed a suit seeking declaration and injunction against the Annual General Meeting (AGM) of the Madras Race Club, challenging the mode of conducting the AGM and the election process. The trial judge granted an interim injunction, which was later suspended by the court.
Finding of the Court:
The court found that the election conducted by the committee, pursuant to its order, was valid. It clarified that the question of suit maintainability was pending before the court and directed the trial court to hear and dispose of the suit on its merits.
Issues: Validity of election process, Suit maintainability under Section 241 of the Companies Act
Ratio Decidendi: The court held that the election conducted in compliance with the circulars issued by the Ministry of Corporate Affairs was valid. It refrained from expressing an opinion on the suit's maintainability, as it was pending before the court.
Final Decision: The Civil Miscellaneous Appeals were partly allowed, modifying the trial judge's orders to the limited extent. The court directed the Secretary of the Madras Race Club to declare the election results and allowed the trial court to hear and dispose of the suit on its merits.
JUDGMENT
(Prayer in CMA No.2520 of 2022: This Civil Miscellaneous Appeal is filed under Order XLIII Rule (v) of Code of Civil Procedure, against the fair and decreetal order passed on 26.10.2022 in I.A.No.2 of 2022 in O.S.No.5031 of 2022, pending on the file of the learned Principal Judge, City Civil Court, Chennai.
CMA No.2521 of 2022: This Civil Miscellaneous Appeal is filed under Order XLIII Rule (v) of Code of Civil Procedure, against the fair and decreetal order passed on 26.10.2022 in I.A.No.3 of 2022 in O.S.No.5031 of 2022, pending on the file of the learned Principal Judge, City Civil Court, Chennai.)
Common Judgment:
Defendants in the suit are the appellants herein, in both the Civil Miscellaneous Appeals.
2. By consent of both parties, these Civil Miscellaneous Appeals are taken up together, heard and disposed of by this common judgment.
3. The brief facts that are required for determination of these Civil Miscellaneous Appeals, at this juncture, are as under:-
(i) The respondent herein had filed a suit in O.S.No.5031 of 2022 before the learned Principal Judge, City Civil Court, Chennai, for declaration and injunction as under:
(a) for a declaration, declaring that the Annual General Meeting (AGM) of the members of the Madras Race Club, to be held on 11.08.2022 at 04.30 p.m at Registered Office of the Club, situated at Guindy, Chennai-600 032 and also through Video Conferencing (-VC-) facility or Other Audio Visual Means (OAVM) or any other subsequent date, as illegal and void;
(b) for a permanent injunction restraining the defendants 1 and 2, their men, Agencies, Servants, Staffs, Subordinate, Legal representative assigns or anybody claiming through them, any manner, from conducting remote e-voting to enable the members to cast their vote online from 08.08.2022 till 10.08.2022 or any other subsequent date for the post of four Committee Members of Madras Race Club (in short -MRC-); and
(c) for a permanent injunction restraining the defendants 1 and 2, their men, Agencies, Servants, Staffs, Subordinate, Legal representative assigns or anybody claiming through them, any manner, conducting the Annual General Meeting (AGM) of the members of the Madras Race Club on 11.08.2022 at the Club premises, and also through Video Conferencing (-VC-) facility or Other Audio Visual Means (OAVM) or any other subsequent date, as illegal and void.
(ii). In the said suit, the respondent/plaintiff has also filed respective Interlocutory Applications seeking interim injunction restraining the defendants from in any manner, conducting remote E-voting to enable the members to cast their vote online on 08.08.2022 or any subsequent date for the post of 4 committee members and also permanent injunction in conducting AGM through Video Conferencing or OAVM.
(iii) Records reveal that the respondent/plaintiff filed the above suit in the month of July 2022 and an ad-interim injunction appears to have been passed by the learned trial Judge, against which, the present appellants have filed CRP.(PD).No.2485 of 2022 under Article 227 of the Constitution of India, to struck off the plaint.
(iv) It appears that the learned single Judge of this Court, by an order dated 04.08.2022 has passed an order to approach the trial Court by way of vacate stay petition under Order 7 Rule 11 of C.P.C., for rejection of the plaint.
(v) As against the said order dated 04.08.2022, the appellants have filed S.L.P(C) No. 145636 of 2022 before the Hon’ble Supreme Court and by an order dated 29.08.2022, the S.L.P was disposed off with a direction to this Court to convert C.R.P as an appeal under Order 43 of C.P.C and to hear and dispose of the same. Accordingly, the C.R.P. was converted into C.M.A and this Court by order dated 19.09.2022 in CMA Nos.2040 and 2081 of 2022, set aside the order pa
