DILIP CHAND KANKARIA Vs. PRADIP KUMAR GHOSH

JUDGEMENT

(1.) This appeal arises out of an Order dated 20.06.03 passed by the learned Judge, 9th Bench, City Civil Court at Calcutta holding therein that the plaintiff/appellant has chosen a wrong forum in filing the plaint before the Civil Court at Calcutta and the learned Judge directed that the plaint along with all documents be returned to the plaintiff/appellant in view of the provisions of Order 7 Rule 10 of the Civil Procedure Code, 1908 for being presented before the appropriate forum.

(2.) The material facts of the instant case, which led to the said order, are as follows : A suit, being Title Suit No. 213 of 2002, for declaration and injunction was filed by the plaintiff/appellant in the City Civil Court at Calcutta alleging therein various mis-management in the affairs of the Company, namely Northern Properties Private Ltd., (hereinafter referred to as the 'said Company). It is not in dispute that the said Company was incorporated under the Companies Act, 1956 on or about 12.6.1972 and its registered Office is at 47, Pathuriaghata Street, P.S.-Jorabagan, Calcutta-700 006. These facts have been stated in the plaint itself. The substance of the allegations in the plaint were that some of the Directors taking advantage of close relationship with the family of the plaintiff/appellant indulged in several acts of mis-management and deceit, which ultimately led to improper allotment of shares. It is also alleged that all these acts have been done by the defendants by flouting the Company Law and other statutory provisions and many of the assets of the said Company have, thus, been wasted and mis-appropriated. It has also been stated that the shares of the said Company have been sold without offering it to the existing shareholders for achieving the said purpose and the statutory records of the said Company have been falsified and forged documents have been filed with the Registrar of the Companies and it was stated that all these things have been done to deprive the plaintiff/appellant of his right under the Company Law. In fact, serious mismanagement in the affairs of the said Company has been alleged by the plaintiff/appellant against the defendants. It has also alleged that the plaintiff is a major shareholder and his right as a shareholder has been infringed and affected and the affairs of the said Company have also been thoroughly mis-managed and on the basis of those allegations, a plaint was filed with several prayers. Some of the prayers in the plaint are set out below :- ?b) Declaration on the basis of the defendant Company's shareholding, the plaintiff is still the majority shareholder of the said defendant Company and the defendant No. 1 to 3 have no right and/or authority to create any new issue of shares without the preferential right to plaintiff to acquire the same. c) Declaration that the plaintiff is a director of M/s. Northern Properties (P) Limited at 47, Pathuriaghata Street, Calcutta - 700 006 and is entitled to discharge all power and functions as a director of the said Company in accordance with the provisions of the Companies. d) Declaration that the defendant Company was/is entitled to entire 50% of the floor area ratio of premises as 11/2, Sarat Bose Road, Calcutta leaving aside 50% receivable or money received by the Promoters and Asit Kumar Ghose (since deceased) have no right, title and interest in the said Property above and except as a lesser under the provisions of the Transfer of Property Act. e) Declaration that the defendant Nos. 1 and 3 and other persons have no right to function as a director and to take any decision and/or transact any business of the defendant-Company and only the Plaintiff can discharge his functions and participation in the management of the defendant-Company as a Director.?

(3.) After the plaint was filed and the defendants entered appearance, an application for rejection of the plaint was filed on behalf of the said Company, defendant No.4. It was stated by the defendant No.4 that at no point of time under the City Civil Court Act, 1953 (hereinafter referred to as the said Act) the City Civil Court can entertain or determine any suit which calls for a trial relating to internal management and functioning of a Corporation, In this connection, reliance was placed on Entry No. 10 of the First Schedule of the said Act. According to the objection, the provisions of the said Act read with the Schedule bar the jurisdiction of the City Civil Court to entertain the suit. In the said application, which was filed by the said Company, a prayer was made as under :- ?b) Declaration that the learned City Civil Court has no jurisdiction to entertain and/or determine the Title Suit No. 213 of 2002 and the plaint be returned with cost.?