IN THE GAUHATI HIGH COURT (The High Court of Assam, Nagaland, Mizoram and Arunachal Pradesh) Small Industries Development Bank of India ( SIDBI)

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1 Review Petition No. 73/2013 (Arising out of Misc. Case No. 705/2013 In FAO 6/2013) IN THE GAUHATI HIGH COURT (The High Court of Assam, Nagaland, Mizoram and Arunachal Pradesh) Small Industries Development Bank of India ( SIDBI).Petitioner -Versus- The North Eastern I. & T. Co. Ltd. Opposite Party. BEFORE HON BLE MR. JUSTICE C.R. SARMA For the Petitioner : Dr. A Saraf, Sr. Advocate. Mr. O.P. Bhati, Advocate. Mr. S.K. Singh, Advocate. Mr. A. Goyal, Advocate. Ms. N. Hawlia, Advocate. Ms. M.L. Gope, Advocate. Ms. K. Choudhury, Advocate. Mr. P. Baruah. For the Opposite Party : Mr. K.N. Choudhury, Sr. Advocate. Mr. J. Roy, Advocate. Date of hearing : Date of delivery of judgment & order : JUDGMENT & ORDER (CAV) By this application, filed under Order 47 Rule 1 r/w Section 151 CPC, the petitioner has prayed for review of the order, dated , passed by this Court in MC No. 705/2013, on the ground, amongst others, that the

2 2 observation that the resolution adopted, pursuant to notification dated , was given effect by notification, dated is a mistake apparent on the face of the record, inasmuch as the resolution, dated , adopted in pursuance to the notification dated , was given effect on itself. The petitioner i.e. the Small Industries Development Bank of India (SIDBI), a body corporate, as a member of the North Eastern Industrial & Technical Consultancy Organization Lt. (for short, NEITCO) by notification, dated , called for an Extra-Ordinary General Meeting (EGM) on at 11 A.M. at SIDBI Office, Guwahati and accordingly a resolution, removing Sri Arijit Bhattacharjee, from the office of the Director of the NEITCO, was adopted. It was also resolved that Sri Bhattacharjee would cease to be the Managing Director of the said Company. In view of the above, Sri Bhattacharjee, as the Managing Director, NEITCO instituted Title Suit No. 94/2013, in the Court of the Civil Judge No. 2, Kamrup, Guwahati, against the SIDBI, seeking a decree for declaration and perpetual injunction thereby restraining the defendants, their men, agents, servants etc. from acting on the basis of the said resolution, adopted in pursuance to the notification dated The learned Civil Judge No. 2, by his order, dated , while disposing the Misc. (J) Case No. 143/2013, arising out of an application, filed under Order 39 Rule (1) and (2) CPC read with Section 151 CPC, rejected the plaintiff s (respondent in the review petition) prayer for temporary injunction, holding that, in view of Section 10 GB of the Companies Act, Civil Court was not vested with jurisdiction in company affairs. Aggrieved by the said order, the present respondent, as appellant, preferred an appeal, being FAO No. 6/2013, challenging the order, dated , passed by the learned Civil Judge No. 2, Kamrup, Guwahati in Misc. (J) Case No. 143/2013, aforesaid. This Court, after hearing the learned Sr. Counsel for the appellant, by order, dated , directed the matter to be listed on ,

3 3 for motion hearing and as an interim measure, the Court directed not to give effect to the resolution adopted pursuant to the notification dated aforesaid. The order, dated , reads as follows: Heard Mr. K N Choudhury, learned Senior counsel appearing for the appellant. This appeal is filed by the respondent in connection with Misc. (J) Case No. 143/13. Mr. Choudhury submitted that since Caveat was filed by the respondent, a serious effort was made to cause service of notice upon the respondents counsel. However, the respondents counsel refused to accept the notice. Seen the report. None appears for the respondent. Since the counsel for the Caveator did not accept notice. Mr. Choudhury has prayed for listing the matter on for motion hearing. However, Mr. Choudhury, learned Senior counsel has prayed that till the next date fixed resolution adopted pursuant to the notification dtd may not be given effect. Considering the matter in its entirety for the ends of justice till the next date fixed, the resolution adopted by the respondent, pursuant to the notification dtd (document xv) shall not be given effect. By order dated , the case was directed to be listed on in terms of the order, dated On , this Court, after hearing the learned Counsel for both the parties, directed to list this case on On , direction was made to list the matter for admission on with the observation that an endeavor shall be made to

4 4 dispose the matter on the next date. Direction was also made to continue with the earlier interim order till the said date. The respondent filed an application for stay of the operation of the impugned order, dated , passed by the learned Civil Judge (Jr. Div. No. 2) in Misc. (J) No. 143/2013. The said application gave rise to Misc. Case No. 705/2013. In Misc. Case No. 705/2013, the learned Counsel for both the parties appeared and Mr. Bhati, learned Counsel for the respondent, submitted that the resolution adopted by the respondent, pursuant to notification dated , was already carried out. However, the Court, while posting the matter on , directed that the interim order, passed earlier by order dated would continue till the next date. The opposite party also filed an application under Order 39 Rule 2A C.P.C. alleging disobedience of the interim orders dated and , passed in FAO 6 of This application was registered and taken up as Misc. Case No. 1109/2013. Referring to the notice, dated , the learned Sr. Counsel, on , appearing for the appellant in M.C. No. 705/2013 and relying on the case of Prestige Light Limited Vs.- State Bank of India, reported in SCC 499, submitted that the respondent by issuing the said notice knowingly flouted the interim order, passed by this Court and as such, they had no right to be heard unless they purged themselves of the contempt. In view of the said submission, this Court, by order dated i.e. the order under review, observed that in view of Annexure-5 to the Misc. Case No. 1109/2013, notification dated , the NEITCO, had given effect to the resolution aforesaid and also directed the respondent (present petitioner) to obtain necessary instruction and file affidavit regarding compliance of the interim order. It was further observed that the interim order shall continue till the next date.

5 5 The said Annexure- 5 i.e. notice dated reads as follows: North Eastern Industrial & Technical Consultancy Organization Ltd. NOTICE Notice is hereby given that pursuant to the Ordinary Resolution passed at the Extra Ordinary General Meeting of the Shareholders of North Eastern Industrial & Technical Consultancy Organisation Ltd. (NEITCO), having its registered office at Udyog Vikas Bhawan, G.S. Road, Bhangagarh, Guwahati, Assam held on Thrusday March 14, 2013 at a.m. at SIDBI office at Guwahati, the shareholders (with unanimous consent of all the shareholders present at the meeting) have removed Shri Arijit Bhattacharjee from the post of Director from the Board of NEITCO and have also removed him from the post of Managing Director in terms of Section 284 of the Companies Act He is no longer Director/ Managing Director of NEITCO with effect from 14 th March The Hon ble High Court, Guwahati, has been kept informed that the resolution passed on March 14, 2013 has been implemented. Shri Arijit Bhattacharjee is not authorised to represent the NEITCO in any matters whatsoever and banned from entering the offices/ premises of NEITCO Trespasser into Govt. Property may be prosecuted for the offence. Date: By order Place: Guwahati Non Executive Chairman NEITCO Taking cognizance of the said notice, this Court passed the following order on ( i.e. order under review):

6 6 Heard Mr. K.N. Choudhury, learned Sr. Counsel, assisted by Mr. J. Roy, learned Counsel, appearing for the petitioner. Also heard Mr. O.P. Bhati, learned Counsel, appearing for the respondent No. 1. Mr. O.P. Bhati, learned Counsel, appearing for the respondent No. 1, has prayed for vacating the interim order. From the record, it is found that this Court, vide order, dated , passed in FAO No. 6/2013, directed the respondent not to give effect the resolution, adopted by the respondents in pursuance to the notification dated Subsequently, on , Mr. O.P. Bhati, learned Counsel for the respondent No. 1, appearing in this case, submitted that the resolution adopted by the respondents pursuant to the notification dated was carried out. This Court, while fixing the matter on , directed that the earlier interim order, dated , shall continue till the next date. Thereafter, vide dated , passed in FAO No.6/13, this court directed to continue with the said interim order. Form the Annexure- 5 to the Misc. Case 1109/13, it appears that the NEITCO, by notification dated , has given effect to the resolution aforesaid. The learned Sr. Counsel, appearing for the petitioner, referring to the decision in the case of Prestige Lights Ltd. -Vs.- State Bank of India reported in (2007) 8 SCC 449 has submitted that as the respondent has knowingly flouted the interim order, passed by this court, they have no right to be heard unless they purge themselves of the contempt. In view of the above, the learned Counsel, appearing for the respondent, shall obtain necessary instruction and the respondent

7 7 shall file an affidavit-in-opposition, regarding compliance of the interim order aforesaid. The earlier interim order shall continue till the next date. According to the review petitioner, as the resolution, adopted in pursuance to the notification, dated , was already given effect to on , itself by publishing public notice on (published in newspaper dated ) and by filing Form No. 32 ( ) on i.e. prior to the passing of the interim order, dated , the findings that the NEITCO, by notification issued on had given effect to the said resolution by flouting the interim order (i.e. order dated ) was a mistake apparent, on the face of the record. It is also contended that the review petitioner did not flout any order/ direction, made by this Court and as such the law laid in the case of Prestige Light Limited (supra) will not be applicable to the present case. Dr. A Saraf, learned Sr. Counsel, assisted by Mr. O.P. Bhati, learned Counsel for the petitioner, referring to the orders, dated and dated and the relevant notification dated (published in newspaper dated ), the Form- 32 ( ) and the notification dated has submitted that, in fact, the said resolution was given effect by making paper publication on the same day and also by filing the Form- 32 vide on at hours and therefore, there remained nothing to give effect after the order dated was passed. It is also submitted that the said resolution was given effect to as far as back as on and and that the petitioner in Misc. Case No. 705/2013 (i.e. the respondent in the review petition and appellant in FAO No. 06/2013) issued the notification dated only to make it known that the EGM of the share-holders of NEITCO had removed Mr. Arijit Bhattacharjee from the Post of Managing Director of NEITCO in terms of Section 284 of the Companies Act and that the High Court was informed that the resolution, passed on , was implemented. It is also

8 8 submitted that, by the said notification, dated , no attempt was made to give fresh effect to the resolution dated , inasmuch as the same became effective from and It has further been submitted that the said notification dated has been issued by the NEITCO, which filed the Misc. Case No. 705/2013 as well as the FAO and not by the review petitioner i.e. the respondent in the FAO 6 of Therefore, Dr. Saraf, learned Sr. Counsel, for the petitioner has strenuously contended that the observation, made in the order, dated , that vide notification dated , the resolution dated was given effect to is not factually correct and that the respondent in the said appeal and misc. case i.e. the review petitioner can not be held liable for the said act done by the NEITCO. It is submitted that the issuance of the said notification dated did not amount to violation of the order dated by this petitioner, inasmuch as the resolution was already carried out on and i.e. prior to the order, passed on In view of the above, it is submitted that there was error, apparent, on the face of record, in passing the order dated and as such, the same is required to be reviewed. Refuting the said argument, advanced by the learned Sr. Counsel, appearing for the petitioner, Mr. K N Choudhury, learned Sr. Counsel, appearing for the respondent, has submitted that the Court, vide order dated and the subsequent orders thereof, specifically directed not to give effect to the resolution dated , but the petitioner, by making paper publication and also issuing the notification, dated , flouted the Court s interim order dated and such other subsequent orders. It is submitted that the subsequent order, dated , reiterating the earlier interim order, dated , was passed by the Court despite the submission, made by the learned Counsel, for the petitioner ( respondent No. FAO and Misc. Case 705/13) that the

9 9 resolution adopted by the respondents, pursuant to the notification dated was carried out. Therefore, it is submitted that, by issuing the notification dated , the prohibitory order dated has been disobeyed and as such there was no error, apparent, on the face of the record, requiring review of the order dated Having heard the learned Counsel for both the parties, I have carefully perused the interim order dated , the resolution dated , the paper publication dated , the Form-32, the notice dated and the order dated From the said resolution, dated , adopted by E.G.M., it transpires that in pursuance to the notice dated , issued by the SIDBI Member, NEITCO and under the provisions of Sections 284 and 190 of the Companies Act, 1956 and Article 72 r/w Article 3(a) of the Articles of Association of the Company, Sri Arijit Bhattacharjee, Director of the Company, was removed from the office of the Director of the Company. From the Annexure-G to the Misc. Case No. 705/2013, it is found that the a notice in pursuant to the said resolution was published in the Daily Newspaper, namely, The Assam Tribune and the Purbachal Prahari in their issues dated From the said publication, it appears that public notices were issued on That apart, from the entries made vide Form-32, under Sections 303(2), 264(2) or 266(1)(a) and 266(i) (b)(iii) of the Companies Act, 1956 ( Annexure-D to the affidavit-in-opposition, filed in Misc. Case No. 705/2013) it appears that Mr. Arijit Bhattacharjee ceased to be a Director of the Company w.e.f From Annexure-F to the said affidavit-in-opposition, it transpires that as per the Register Digital Signature maintained by the Ministry of Corporate Affairs, Government of India, Sri Arijit Bhattacharjee, was not shown as the Director of NEITCO. This indicates that his name was deleted from the register of the Company. The said annexure was downloaded on The SIDBI, in its affidavit-in-opposition, filed in Misc. Case No. 705/2013, referring to the said Form-32, the Registrar of Directors, stated that on , Sri Arijit Bhattacharjee ceased to be a Director and that

10 10 he had no locus standi to file the Misc. Appeal and the Misc. Case. The said respondent further stated that, after the adoption of the resolution aforesaid, the Form-32, as prescribed by the Companies Act was electronically sent to the Registrar of Firms, Shillong on and that, thereafter, necessary change was effected by the Registrar of Companies. The annexure Nos. D and F support the said contention. In view of the entries, made in the said annexures, it appears that effect to the resolution aforesaid was given on itself. That apart, from the paper publication i.e. Annexure No. G, it is clearly found that the fact regarding removal of Sri Arijit Bhattacharjee was notified on itself and the paper publication was made on In view of the said notices, there is no difficulty in understanding that the resolution, adopted in the said E.G.M., was already carried out on and in the said manner. Therefore, it is found that by the notice dated , as indicated in the order dated aforesaid, the NEITCO had only made it known that, in view of the resolution dated , Sri Arijit Bhattacharjee was removed from the Post of Director, NEITCO and that the High Court was informed that the said resolution was implemented. In fact, Mr. O.P. Bhati, learned Counsel for the respondent, on , informed this Court that the said resolution was carried out. That apart, the notice dated , on the basis of which the order dated was passed, does not appear to be issued by this review petitioner. The same, as stated by this petitioner, was issued by the NEITCO. In view of the above, considering entire aspect of the matter, it is clearly found that the resolution aforesaid was implemented on and and there remained nothing to be implemented by this petitioner on On , at the time of taking up the Misc. Case No. 705/2013, the facts regarding filing of the Form-32 (Annexure- D ), the entry made in the Registrar of Directors (Annexure- F ) and the paper publication (Annexure- G ) escaped the notice of this Court and as such, the order dated

11 with the said observation and direction, as indicated above, could be passed. In my considered opinion, the said observation, regarding giving effect to the resolution was an error apparent, on the face of the record. Therefore, the said observation and direction were unwarranted and as such the order, dated needs to be modified by deleting the said observation and direction, therefrom. In view of what has been discussed above, I find sufficient merit in this review petition. The said observation and the direction made by this Court, in order dated , shall stand deleted Accordingly the said order is modified. The review petition is allowed. JUDGE Kishor

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