KHETAN INDUSTRIES PRIVATE LIMITED Vs. MANJU RAVINDRAPASAD KHETAN

JUDGEMENT

(1.) TWO questions of law arise for consideration in this revision application viz. , (1) which is the principal Civil Court for Bombay for the purpose of proceedings for removal of the trustees under Chapter 7 of the Indian Trusts Act, 1982 and (2) whether a civil suit lies for removal of directors of a private limited company incorporated under the Companies Act, 1956.

(2.) A suit was filed by the respondents against the petitioners (original defendants) in the City Civil Court, at Bombay claiming following reliefs :

(3.) DEFENDANT No. 1 in the original suit is Khetan Industries Private Ltd. , a company incorporated under the Companies Act, 1956. Defendant No. 2 is "putra Vadhu Family Trust", a private trust registered under the Indian Trusts Act. Defendants 3 to 5 are the trustees of the said trust. Defendants 6, 7 and also defendant No. 3 are the directors of defendant No. 1 company. In para 22 of the plaint it is specifically stated that the suit is for declaration and injunction. Prayers (a) to (d) are deemed to be valued at Rs. 300/- each and Court fees paid accordingly. It was further stated that other prayers were of consequential nature and no separate Court fees were payable. It is evident from the above statement in para 22 of the plaint that prayer (e) is only consequential to prayers (a) to (d) set out above. The respondents herein (original plaintiffs) also took out a Notice of Motion for grant of ad-interim relief. The defendants (present petitioners) contested the Notice of Motion on the ground, inter alia, of lack of jurisdiction of the Civil Court to entertain and try the said suit. The trial Court, therefore, framed the following preliminary issue : whether this Court has jurisdiction to entertain and try this suit ?" it was contended by the defendants before the trial Court that in view of the provisions of sections 73 and 74 of the Indian Trusts Act the relief claimed in the suit for removal of defendants 3 to 5 from the trusteeship of the trust and for restraining them from functioning as trustees is not maintainable. According to the defendants, the proper forum for such a relief is the High Court which is the principal Civil Court for Bombay. It was also contended that in view of the provisions of the Companies Act, 1956, which deals with the entire gamut of appointment, functioning and removal of directors and more particularly the provisions of section 10 of that Act, no suit is maintainable in a Civil Court for removal of the duly elected directors of a company incorporated under that Act. Anyone seeking removal of the directors has to avail of the specific remedy provided under the Companies Act for that purpose. The trial Court decided both the issues against the defendants and held that it had jurisdiction to try the suit. The above order has been challenged by the defendants in this revision application.