Mr. Vijay Vasant Dhavle vs M/S. Dolce Pharmaceuticals Private ...

Mr. Vijay Vasant Dhavle Appellant

Versus

M/s. Dolce Pharmaceuticals Private Limited and Others. ... Respondents

Present: For Appellant : Shri Virender Ganda, Senior Advocate with Mr. Iswar Mohapatra and Mr. Tarun Mehta, Advocates.

For Respondents: Mr. Rudreshwar Singh, Mr. Kaushik Poddar, Advocates for Respondent No. 1, 4 & 5.

JUDGMENT

SUDHANSU JYOTI MUKHOPADHAYA, J.

The Appellant! Petitioner preferred a petition under Section 59 of

the Companies Act, 2013 in the year 2015 before the erstwhile Company

Law Board with relief as prayed therein. On the constitution of the

National Company Law Tribunal (hereinafter referred to as "Tribunal"),

the petition was transferred before Mumbai Bench, Mumbai, as

C.P.No.6/59/CLB/MB/MAH/2016. By impugned order dated 1st May,

Company Appeal (AT) No. 217 of 2017 2

2017, the Tribunal noticed the relief as claimed by the Appellant!

Petitioner at para 10 (b) of the main petition that the names of the 4th and

5th respondents, namely Mr. Gopalkumar Prabhakumar Nair and Mrs.

Rakhi Gopalkumar Nair respectively have been wrongly included as

members of the 1st Respondent Company for which, prayer was made to

remove their names. Further, prayer was made to set aside the resolution

dated 21st February, 2015 passed by the 1st Respondent Company,

whereby the Appellant! Petitioner was removed as Director of the said

Company.

2. The Tribunal by impugned order dated 1st May, 2017, noticed the

fact that the names of the 4th and 5th Respondents, namely Mr.

Gopalkumar Prabhakumar Nair and Mrs. Rakhi Gopalkumar Nair, were

recorded in the year 2010. Earlier the Appellant filed a Company Petition

No. 25 of 2012 before the erstwhile Company Law Board- "Mr. Vijay

Vasant Dhavale Vs. M/s. Dolce Pharmaceuticals Private Limited & Ors"

for deletion of the names of 4th and 5th Respondents namely Mr.

Gopalkumar Prabhakumar Nair and Mrs. Rakhi Gopalkumar Nair, which

was dismissed by the Company Law Board on 20th May, 2013 on the

ground of delay and laches, as the Appellant kept silent for seven years.

3. Having noticed the aforesaid fact and the decision of the erstwhile

Company Law Board, by impugned order dated 1st May, 2017, the

Tribunal held as follows: -

Company Appeal (AT) No. 217 of 2017 3

"14. In view of the above factual and legal position

I am of the conscientious view that the relief claimed

vide para 10 (b) of the Main Petition, that "the name

of the fourth and fifth Respondents, respectively

namely Mr. Gopalkumar Prabhakumar Nair and Mrs.

Rakhi Gopalkumar Nair, illegally placed on the

Register of Members of the first Respondent

Company, without any sufficient cause, may kindly

be removed." had already become barred by

limitation. The dates on which the said impugned

event took place, had been held as the date on which

the Petitioner was required under law to initiate the

legal proceedings however took the action in the year

2012 against the Respondents which was held as

sufficient ground to reject the claim of the Petitioner

being barred by limitation. Even by the repeated

litigation the facts could not be changed as well as the

dates could not be altered therefore the result shall

also not get effected. Once an event had been held as

barred by limitation and not entertained for due

adjudication on merits, that event or cause of action

shall always remain thereafter that too forever as

barred by limitation. As far as the question of

application of Resjudicata is concerned, definitely the

Company Appeal (AT) No. 217 of 2017 4

issue of allotment of shares to Respondent No. 4 & 5

should not be re-adjudicated being repetitive in

nature already stood finally decided by a competent

court. I have no hesitation in holding that the said

issue was exactly the issue directly and substantially

raised in the former Petition (CP No. 25 of 2012), hence

barred by the principle of Resjudicata. For the sake of

brevity, it is felt that the case laws cited supra are not

required to be discussed at length."

4. While holding so, the Tribunal kept the matter pending with regard

to the removal of the Appellant! Petitioner from the Directorship made

pursuant to EoGM dated 21st February, 2015, as the same do not fall

within the ambits of resjudicata and directed to list the main petition for

hearing on 30th June, 2017.

5. The Appellant/ Petitioner has not made it clear as to whether any

final order was passed in the Company Petition in regard to the EoGM

dated 21st February, 2015, the case having been fixed for 30th June,

2017.

6. Learned counsel appearing on behalf of the Appellant! Petitioner

submitted that the Tribunal erred in holding that rejection of the

application on the ground of limitation amounts to res judicata, as

observed by the Tribunal and quoted above. Reliance has been placed on

Company Appeal (AT) No. 217 of 2017 5

the decision of the Hon'ble Supreme Court in "Noharlal Verma Vs.

District Co-Operative Central Bank Limited, Jagdalpur - (2008) 14

SCC 445", wherein the Hon'ble Supreme Court held:-

"18. So far as resjudicata is concerned, in our opinion,

the appellant is right in submitting that the Tribunal

was not justified in holding that the application filed by

the appellant was barred by res judicata. It is clear

from the facts stated hereinabove that the application

was filed by the appellant to the Joint Registrar,

Raipur. It was pending. Meanwhile, however, District

Bastar had its own Registry and hence, an application

was submitted to the District Registrar, Bastar. The

application preferred by the appellant to the Joint

Registrar, Raipur, in the circumstances, became

infructuous. It was not decided on merits. As per

settled law, such decision does not operate as res

judicata. The High Court was, therefore, right in coming

to the conclusion that the Tribunal was in error in

dismissing the application on the ground of res

judicata. That part of the order passed by the Tribunal

was, therefore, rightly not approved by the High Court.

35. To us, the High Court was right in observing that

the Tribunal was in error in allowing the appeal and

Company Appeal (AT) No. 217 of 2017 dismissing the claim of the appellant on the ground of

res judicata. The High Court, therefore, considered the

said question independently and held that the Bank

was right in submitting that the appellant had not

approached the Registrar within the period prescribed

by law and his application was liable to be dismissed."

7. Reliance was also placed on the decision of the Hon'ble Supreme

Court in "State of U.P. and Anr. Vs. Jagdish Saran Agrawal and Ors.

(2009)1 SCC 689", wherein the Hon'ble Supreme Court held as follows:-

"14. In the present case, the suit filed by Nagar Palika

was dismissed on technical ground and in any case

the State was not a party. So far the suit where the

State was a party and amendments were made, the

same was dismissed for non-prosecution. But the

same was not dismissed under Order 9 Rule 8. Order

9 Rule 8 and Order 9 Rule 9 CPC read as follows:

"8. Procedure where defendant only appears.--

Where the defendant appears and the plaintiff does

not appear when the suit is called on for hearing,

the court shall make an order that the suit be

dismissed, unless the defendant admits the claim,

or part thereof, in which case the court shall pass a

decree against the defendant upon such admission,

Company Appeal (AT) No. 217 of 2017 7

and, where part only of the claim has been

admitted, shall dismiss the suit so far as it relates

to the remainder.

9. Decree against plaintiff by default bars fresh

suit.--(1) Where a suit is wholly or partly dismissed

under Rule 8, the plaintiff shall be precluded from

bringing afresh suit in respect of the same cause of

action. But he may apply for an order to set the

dismissal aside, and if he satisfies the court that

there was sufficient cause for his non-appearance

when the suit was called on for hearing, the court

shall make an order setting aside the dismissal

upon such terms as to costs or otherwise as it thinks

fit, and shall appoint a day for proceeding with suit.

(2) No order shall be made under this rule unless notice

of the application has been served on the opposite

party."

Therefore, Order 9 Rule 9 cannot be said to be

applicable. The dismissal of the suit for non-

prosecution was not a decision on merit. Consequently,

the said order cannot operate as res judicata."

8. Learned counsel appearing on behalf of the Respondents submits

that once a relief earlier sought for i.e. about removal of the names of 4th

Company Appeal (AT) No. 217 of 2017 8

and 5111, Respondents, namely, Mr. Gopalkumar Prabhakumar Nair and

Mrs. Rakhi Gopalkumar Nair and such prayer was dismissed as barred

by limitation or on the ground of delay and laches, no such subsequent

relief can be sought for.

9. We agree with the submissions made on behalf of the

Appellant! Petitioner that an application which is barred by limitation

cannot be held to be res judicata for the purpose of subsequent claim,

and hold that the Tribunal erred in holding that the prayer made in the

petition is barred by limitation.

However, once a claim has been dismissed on the ground of

limitation or on the ground of delay and laches, such prayer cannot be

made thereafter, in absence of fresh cause of action.

10. The prayer of Appellant to remove the names of 4th and 5th

Respondents i.e. Mr. Gopalkumar Prabhakumar Nair and Mrs. Rakhi

Gopalkumar Nair from Register of the Companies earlier having been

dismissed in the year 2012 on the ground of delay and laches, the

subsequent petition for the same relief in the absence of any subsequent

cause of action were not maintainable and thereby the Tribunal rightly

held that earlier application having been dismissed on the ground of

limitation and on the ground of delay and laches, no subsequent relief

can be granted in absence of any fresh cause of action.

Company Appeal (AT) No. 217 of 2017 9

11. In so far as the EoGM dated 21st February, 2015 is concerned, by

which Appellant/ Petitioner was removed as Director, we do not express

any opinion at this stage as the matter may be still pending with the

Tribunal, but it has not been cleared by the Appellant as to how the

declaration with regard to the decision taken on EoGM dated 21st

February, 2015 can be decided in a petition under Section 59 of the

Companies Act, 2013, therefore, such question is left open for

determination by the Tribunal.

12. We find no merit in this appeal. It is accordingly, dismissed.

However, in the facts and circumstances of the case, there shall be no

order as to cost.

(Justice S.J. Mukhopadhaya) Chairperson

(Justice A.I.S. Cheema) (Balvinder Singh) Member (Judicial) Member(Technical)

NEW DELHI

20th November, 2017

AR

Company Appeal (AT) No. 217of2017