BANSIDHAR SHANKARLAL Vs. MOHAMMAD IBRAHIM

JUDGEMENT

(1.) Mohammed Ibrahim (hereinafter called "the plaintiff") instituted an action in the Court of the Subordinate Judge, Alipore for a decree in ejectment in respect of land occupied by the Luxmi Spinning and Weaving Mills Ltd. as his tenant. The suit was decreed on October 1, 1953. Before the decree was passed, the Company had executed on January 31, 1951 a deed in favour of Bansidhar mortgaging its fixed assets for securing repayment of Rs. 1,25,000/-. After the decree of the Trial Court, the Company executed on January 21, 1954 a second deed also in favour of Bansidhar mortgaging the fixed assets for repayment of an additional sum of Rs. 2,00.000/-. The decree of the Subordinate Judge in the plaintiff's suit was confirmed on August 4, 1951 Against that decree the Company and Bansidhar preferred Second Appeal No. 1380 of 1954 to the High Court of Calcutta. Bansidhar also filed a suit in the High Court of Calcutta on its original side to enforce the two mortgages in his favour and obtained a preliminary mortgage decree in the suit on May 13, 1955. Another creditor of the Company applied for and obtained on August 22, 1955 an order directing that the Company be wound up. The liquidators of the Company and Bansidhar prosecuted the Second Appeal No. 1380 of 1954. The decree of the District Court was confirmed by the High Court in its appellate jurisdiction on February 22, 1958. The plaintiff then instituted an application for enforcement of the decree in ejectment against the Company without obtaining leave of the High Court of Calcutta under Section 171 of the Indian Companies Act. 1913. On December 17, 1958, Bansidhar filed a petition contending that the application for enforcement of the decree was not maintainable without leave of the High Court which ordered that the Company be wound up. On the motion of the plaintiff the Company Judge granted leave to execute the decree in Second Appeal No. 1380 of 1951. The Subordinate Judge before whom the proceedings were pending, dismissed the application filed by Bansidhar, and the order of dismissal was confirmed by the Additional District Judge and by the High Court in Second appeal Bansidhar's petition for a certificate for appeal to this Court under Article 133 (1) 16) and (c) of the Constitution was also rejected. Bansidhar then preferred two petitions for special leave to this Court - one against the order of the High Court dismissing his Second Appeal against the order in the execution proceedings, and the other against the order of the High Court refusing to certify the appeal under Article 133 (1) (b) and (c) of the Constitution. This Court dismissed the petition against the order of the High Court in Second Appeal and granted special leave to appeal against the order of the High Court refusing to certify the case.

(2.) The order passed by the High Court in Second Appeal having affirmed the order of the District Court unless the appeal preferred to this Court involved some substantial question of law, of public or private importance, the case could not be certified under Article 133 (1) (b) even if the proposed appeal involved directly or indirectly some claim or question respecting property of value not less than Rs. 20,000/-. The High Court could not also certify the case as a fit one for appeal under Article 133 (1) (c) if in the view of the Court unless it raised a question of some general or public importance.

(3.) Counsel for the appellant says that the Subordinate Judge was incompetent to entertain the application for executing the decree in Second Appeal No. 1380 of 1954, unless the High Court of Calcutta in its company jurisdiction granted leave to execute the decree under Section 171 of the Indian Companies Act. 1913. Counsel urged that leave of the High Court is by the terms of Section 171 of the Indian Companies Act made a condition precedent to the institution of a proceeding against a Company ordered to be wound up by the Court, and that the application for execution of the decree without in the first insistence obtaining leave of the High Court was entertained without authority. The question sought to be raised in the proposed appeal, it was urged, was of general or public importance. In any case it was contended that them is conflict of opinion among the Courts in India on the true interpretation of Section171 of the Indian Companies Act, 1913, and Section 446 of the Companies Act 1956 (which replaced Section 171 of the Act 0f 1913) , and the High Court was bound to grant the certificate applied for either under Section 133 (1) (b) or under Article 133 (1) (c) or both the clauses.