Trishla Jain vs Oswal Agro Mills Ltd. And Anr.
1989 Latest Caselaw 471 Del

JUDGMENT

S.N. Sapra, J.

(1) The present petition has been filed by Mrs. Trishla Jain, under Section 113(3) of the Companies Act, 1956, (hereinafter called the Act), against respondents, thereby claiming the following reliefs : "(a) to pass an order directing the respondent Company to deliver share scrips in respect of 25,782 equity shares -and 8594 debentures to the petitioner or his duly constituted attorney; (b) to direct the company to pay all the unpaid dividends and interests due to the petitioner along with a statement of such dues: (c) to direct the union of India to initiate appropriate action against the company for its failure to pay the dividends and to deliver the shares and debentures; and (d) to grant such other and further reliefs as this Hon'ble Court may deem fit and proper.

(2) For better appreciation, of the contentions, as made by learned counsel for parties, it will be useful, to refer to, in brief the facts of the case.

(3) Petitioner is a non-resident Indian, permanently residing and working for gain at London. Petitioner subscribed to the shares and debentures of respondent No. 1, (hereinafter called the Company) and was allotted 29,000 shares, on February 15, 1983 and 13974 shares on July 27, 1984. All these shares were equity shares of Rs, 10.00 each.

(4) Sometime in January and February, 1986, the Company announced/offered issue of 18,14,400 equity shares and 13.5% redeemable non-convertible debentures on rights issue basis, closing on March 20, 1986.

(5) In response to the offer, petitioner sent in the necessary application for allotment of 25,782 equity shares, at a premium of Rs. 15.00 per share, and for 8594 debentures of Rs. 100.00 each. The amount was paid from Canara Bank, London Branch, by a demand draft, on Canara Bank, Foreign Department, Bhagwan Dass Road, New Delhi, and a rupee equivalent to the amount paid was Rs. 15,03,950.00 . The aforesaid amount was duly deposited with the company's bankers to the issue viz., Hongkong Bank, New Delhi.

(6) By letter dated March 13. 1986, petitioner requested the Company to note the lien of the Canara Bank and also. requested the Company to send the shares/debentures directly to the Canara Bank, London. The Company was further requested to remit the dividends/interests, in respect of the shares, directly to the Canara Bank.

(7) Vide letter dated March 17, 1986, Canara Bank, London Branch, sent photo copy of the form and acceptance of application, for new equity shares and debentures. In the letter, the Bank gave notice of its charge over the aforesaid shares. The Bank further requested the Company to send shares to it, directly after the allotment. Petitioner and other members of her family, constituted Canara Bank, as a their irrevocable attorney, for the purpose of dealing with the shares and debentures.

(8) Vide letter dated July 27, 1986, the Bank informed the Company that the devidends, in respect of the shares, had not been received by the Bank. By another letter, dated October 8, 1986. Canara Bank. New Delhi requested the Company, inter alia to issue share certificate and debentures.

(9) Thereafter, repeated requests were made to the Company, both by petitioner and the Bank, to deliver the share certificates and debentures, to which they were entitled under the rights issue, which closed on March 20 1986. But, the Company failed to deliver the same.

(10) It appears from the Register of members, that on June 23, 1986 25782 shares were allotted to petitioner. Similarly, from the register of debenture holders, on the same day, 8594 debentures were allotted to petitioner.

(11) Since no reply was received from the Company, nor the shares were delivered, either to petitioner or the bank, so petitioner's husband addressed a letter dated February 5, 1987, to the Joint Secretary and Controller of Capital Issue, Government of India, Department of Economic Affairs, thereby complaining of the company's failure to pay the dividends and also, it sailor to deliver the shares/debentures.

(12) In response to the letter. Joint Director, Government of India addressed a letter dated February 25, 1987, to the President, Delhi Stock Exchange. Copy of the letter was also sent to the Chairman of the Company. Respondent Company, vide its letter dated March 10, 1987, to the Joint Director to the Government of India, wrote, "we have to state that the securities of Shri P.D. Jain and others are under dispute and stay order in this respect has been granted by Hon'ble Sub Judge, 1st Class Ludhiana." On April 28, 1987, the Joint Director, addressed a letter to the Company, thereby requesting it to furnish a copy of the proceedings, relating to the stay order, having been granted by the learned Sub Judge, at Ludhiana.

(13) Some time in late 1987, through the Government of India, Office of the Controller of Capital Issues, petitioner received a document, proportion to be the ex parte decree, dated April 30, 1987, passed in a suit, filed by the Company. From the decree, it appears that the Company had filed a suit in the court of Sub Judge, Ludhiana on March 9, 1987.

(14) In the suit, petitioner and other five members of her family, were never served directly, but the order restrained them, from disposing of their remaining shares, in any manner, or from repatriating the same, in any manner, whatsoever. According to petitioner, the Company has abused the process of law, inasmuch as, the Court at Ludhiana has no jurisdiction to entertain the suit. Getting an ex parte decree, in the matter like this, by manipulating to see that no notice was sent to the addresses of the petitioner and other members of her family, who are admittedly residents in London, amounts to Contempt of Court.

(15) As petitioner has not received any reply to the demand for delivery of shares and debentures, even though the same have been allotted, nor the petitioner has been paid dividend in respect of the earlier years, so the Company has clearly acted in contravention of the provisions of Section 113 read with Sections 205 to 207 of the Act.

(16) In reply, the Company has alleged that petitioner is not entitled to claim the reliefs, in view of the order dated January 15, 1988, passed by the Sub Judge First Class, Ludhiana, in Civil Suit No. 17 of 1988, whereby, petitioner has been restrained, either herself and/or acting through any other person, banks or authorised representative, or power of attorney holder, from claiming the shares, debentures, dividends and interest accruing thereon.

(17) The Company, is in no way concerned with the alleged lien with Canara Bank, and in fact, it does not admit that any such lien has been created by the petitioner, in respect of the shares and debentures. However, the Company has admitted that a sum of Rs. l5,03,950.00 was deposited with its bankers. The Company cannot remit the dividends and/or interest to the Canara Bank. In any case, the Company has not confirmed the lien as requested by petitioner in favor of the Bank. The company does not recognise the Canara Bank, London or New Delhi, for the purposes of any correspondence, as no lien on the shares and debentures, has been recognised by the Company.

(18) Petitioner, being a non-resident, it is not possible for the Company to make any remittance to the Canara Bank, but the payment has to be made, in accordance with the Foreign Exchange Regulation Act. It is further alleged by the Company, that the shares and debentures could be delivered to petitioner and to no other person, in accordance with the Foreign Exchange Regulation Act, that too subject to the orders any competent court.In view of the injunction order, petitioner is not entitled in law to, obtain shares and debentures and/or dividend and/or interest thereon.

(19) Vide letter dated July 15, 1987, the Director of the Department of Economic Affairs, Ministry of Finance, sent a letter to the husband of the petitioner, enclosing the order of injunction, passed by the Civil Court at Ludhiana, in Civil suit No. 11 of 1987. In spite of that, petitioner took no steps till date, to have the decree set aside, nor any appeal has been filed.

(20) Thereafter the Company filed another suit, being suit No. 17 of 1988, which is still pending before the Sub Judge 1st Class, Ludhinana. In the suit, the court at Ludhiana, has passed an order dated January 15, 1988. In the suit, notice has already been issued to petitioner and petitioner has not taken any steps to defend the suit. The aforesaid orders are, therefore, binding upon the petitioner and petitioner is restrained, as per the orders from dealing with the shares, debentures, dividend and interest, payable thereon.

(21) Respondent has not abused the process of law or that the Court at Ludhiana has no jurisdiction to entertain the suit.

(22) For similar reliefs, other members of the family, namely, Shri P.D. Jain, Shri Ashok Jain, Mrs. Sangya Jain, Miss Nandita Jain and Mis Rita Jain, have filed petitions, being C.P. No. 228 of 1997, 38 of 1988 to 41 of 1988, against respondents. The Company in its reply, in all the petitions, has raised identical grounds of challenge.

(23) As the reply of the Company was primarily based upon an injunction order, passed by the learned Sub Judge 1st Class, Ludhiana in suit No. 17 of 1988, so, respondent was directed to file the copy of the plaint. Same has been done.

(24) Under the orders of the Court, share scrips in question, in all the petitions, and the dividends accruing there on, have been deposited in Court.

(25) From the copy of the plaint, in suit No. 91 of 1987, filed by the Company against petitioner, and six others, in the Civil Court at Ludhiana it appears that the Company invoked the jurisdiction of the civil court at Ludhiana, on the ground that defendant no. 7 (in that suit), Shri Ganga Ram Sharma, was the authorised representative and attorney of defendants 1 to 6, and that he resided and worked for gain at Ludhiana, where the head office and factory of the company were also situated.

(26) In the subsequent suit, at originally filed by the Company, being suit No. 17 of 1988, the jurisdiction of the Ludhiana Court was invoked on the similar grounds.

(27) Statements of Shri K.L. Jain and Sbri S.C. Khaneja Director and the Secretary, respectively of the Company, were recorded.

(28) The first question, arising for decision, is as to, what is the meaning, object and scope of Section 113 of the Act, as it stood prior to the amendment, as made by the Companies (Amendment) Act, '988.

(29) Dr. Shanker Ghosh, learned counsel for Company, has urged that under Section 113 of the Act. no delivery of shares could be claimed. The Section only requires the Company to keep the shares ready for delivery, within 3 months after the allotment of the shares. According to him, Section 113. nowhere provided that an order for delivery of the shares. could be made. Section 113(2) of the Act, further provides that, if default is made in not complying with sub-section (1), then, the Company and the officer liable for default, would be punishable with fine Under sub-section (3), an application could be made for making good the default. Such an application can be made, only by a person, entitled to have the share certificates or the debentures, delivered to him and not by a stranger. Upon such application, having been made, the Court can make an order, thereby directing the Company and any officer of the Company to make good the default. Therefore, Dr. Shanker Ghosh has contended, that the relief, which the Court can grant under Section 113 of the Act, is to make good the default, namely, the default which is referred to in sub-section (1) as also in sub-section (2) of Section 113 This default is not making the shares ready for delivery. He has placed reliance upon the judgment in case In the matter of Asiatic Oxygen Ltd., .

(30) Dr. Shanker Ghosh has further contended that Section 113 entails penal consequences. Accordingly, the Section has to be construed strictly. As the Section does not contain any provision for delivery of the shares, a suit has to be filed for obtaining such a relief.

(31) Section 113 of the Act, prior to its amendment, reads as under :- "S. 113. Limitation of time for issue of certificates- (1) Every Company shall within three months after the allotment of any of its shares, debentures or debenture stock and within two months after the application for the registration of the transfer of any such shares, debentures or debenture stock, complete and have ready for delivery the certificates, of all shares, the debentures, and the certificates of all debenture stock allotted or transferred, unless the conditions of issue of the shares, debentures or debenture stock otherwise provide. The expression "transfer", for the purposes of this sub-section, means a transfer duly stamped and otherwise valid and does not include any transfer which the company is for any reason entitled to refuse to register and does not register. (2) If default is made in complying with sub-section (1), the company, and every officer of the company who is in default, shall be punishable with fine which may extend to five hundred rupees for every day during which the default continues. (3) If any company on which a notice has been served requiring it to make good any default in complying with the provisions of sub-section (1), fails to make good the default within ten days after the service of the notice, the Court may, on the application of the person entitled to have the certificates or the debentures delivered to him, make an order directing the company and any officer of the company to make good the default within such time as may be specified in the order; and any such order may provide that all costs of and incidental to the application shall be borne by the Company or by any officer of the company responsible for the default."

(32) In the matter of Asiatic Oxygen Ltd. (supra), the High Court of Calcutta was considering the scope of Section 113 of the Act and held that sub-section (1), did not provide for delivery of certificate of shares or debentures, but only enjoined upon the Company to have them ready for delivery. The sub-section did not impose an obligation upon the Company to release the shares. Thus, it did not authorise a person, applying for their delivery, to have an order for delivery of the shares, under this Section. It was held: "I am unable to accept the said contention of Mr. Mukherjee. The words "in regard to delivery" in my view mean 'for the purpose of delivery'. Sub-section (1) to Section 113 imposes an obligation upon the company to complete and to have ready for delivery the certificates of shares, debentures or debenture-stocks allowed or transferred in the circumstances and within time mentioned above. The failure to do so, as we have noted earlier, entails, visiting with imposition of fine under sub-section (2) upon the company or any of the officer of the company who is liable for such default. Sub-section (3) of the said Section empowers the Court to make an order upon the company or any officer of the company only to make good the default in complying with the provisions of sub-section (1) to the said Section. The failure to comply with the requirements of sub-section (1) to the said Section thus shall be visited with penal consequences. In that view of the matter, in my opinion, the said sub-section has to be construed strictly. The said sub-section nowhere provides for delivery of the certificates of share or debentures or debenture-stocks but only enjoins upon the company to have the same ready for delivery. The said words in the sub-section, in my opinion, should not be construed in such a way as to give an extended meaning to the words "to have them ready for delivery". The sub-section (1) does not impose an obligation upon the Company to deliver the said shares etc. Thus, in my opinion, sub-section (3) to the said Section does not authorise a person to have an order for delivery of the said shares. In that view of the matter, in my opinion, this application is in conceived and must fail."

(33) I am in respectful disagreement with the judgment in the matter of Asiatic Oxygen Ltd. (supra) In my view, this was not the intention of the legislature to impose upon company the only obligation to complete and have ready for delivery the certificate, of all shares, debentures etc., and not to deliver the same. This intention of the legislature has been made clear now by the Companies (Amendment) Act, 1988, where the obligation has been specifically imposed on the Company to deliver, in accordance with procedure, as laid down in Section 53, the certificate of all shares, debentures etc., allotted or transferred. It was certainly not the intention of the legislature, that a person, entitled to have the certificate or the debentures delivered to him, shall make an application, first under Section 113 of the Act and after succeeding, shall file a suit for obtaining delivery of the certificate of shares/debentures The words "complete and have ready for delivery" the certificate of all shares debentures etc. have to be given wider interpretation, more-so,when these words are read with the words, as appearing in sub-section 3 to the effect that on the application of the person entitled to have the certificates or the debentures, delivered to him. This lacuna has now been removed by the amendment.

(34) I am supported, in my view, by the commentary under Section 113 of the Act, in A. Ramaiya's Guide to the Companies Act, 10th edition, 1984, at page 311 as follows : "It has been held by the Calcutta High Court (In re Asiatic Oxygen Ltd. , that the duty under the Section is only to complete and keep ready the certificate of shares and the duty does not further extend to delivering the certificate to the person entitled This however, is too narrow an interpretation of the words "complete and keep ready". Both the title to the section and the Companies (Issue of Share Certificate) Rules use the words "issue of share certificate", which necessarily includes delivery.

(35) I am of the view that the aforesaid words include 'delivery'. A person entitled to have the certificate or the debenture delivered to him under Section 113(3) of the Act is also entitled to apply for delivery of the same.

(36) Mr. K.N. Bhat, learned counsel for petitioner, has contended that the ex parte decree dated April 30, 1987, and the order dated January 15, 1988, are not binding upon petitioner and other members of her family, as the same have been passed by the learned Sub Judge 1st Class, Ludhiana, having no jursidiction, as such, same are nullity. According to him, petitioner and other members of her family, who are defendants in the suits, filed by the Company, at Ludhiana, are non-resident Indians, permanently residing in London. He, thus has urged that the Company abused the process of law, in filing the suits in the Civil Court at Ludhiana, when Civil Court at Ludhiana has no jurisdiction to entertain the suits. Mr. Bhat has further urged that the Company has failed to place any document on the record to show that Shri Ganga Ram Sharma was acting as attorney of any of the petitioners, who have filed the present petitions, under Section 113 of the Act. The name of Sh.Ganga Ram has been introduced with a view to invoke the jurisdiction of the learned court at Ludbiana.

(37) Mr. Bhal has, also submitted that Miss Nandita Jain had already filed a petition, being C. P. No. 228 of 1917, under Section 113 of the Act, thereby claiming the reliefs, similar to the reliefs claimed in the other petitions. Prior to the filing of the suit No. 17 of 1988 at Ludhiana, and grant of the ex parte stay order on January 15, 1989, the Company was duly served and its counsel appeared before this Court on January 5, 1988. The Court ordered the deposit of the shares and debentures in the Court by the Company. The shares and debentures were deposited in Court, prior to the filing of the second suit by the Company at Ludhiana.

(38) Statements of Mr. S.C. Khaueja and Mr. K. L. Jain, Secretary and Director respectively of the Company, were recorded on July 27, 1988 and August 16, 1988. Both them admitted, that they did not know Shri Ganga Ram Sharma personally. They failed to produce any document on the record to show that ShriGanga Ram Sharma was acting as attorney of the petitioner or of any other Members of her family.

(39) Mr. Bhat, urged that the decree and orders, being nullity, are honest and this Court should ignore the same. He has placed reliance upon the judgments in Sri Krishna Singh v. Mathura Ahir and others, and Amrit Bhikaji Kale and others v. Kashinath Janardhan Trade and another, .

(40) Dr. Shanker Ghosh, has urged that the injunction order dated January 15, 1988. granted by the learned Sub Judge 1st Class, Ludhiana, is binding on the petitioner, and as such, she is disentitled from claiming the shares, so long as the order remains in force. A person against whom a restraint order is granted, cannot disregard or treat it as a nullity, but must obey the same. If a person is aggrieved by an injunction order, then he must approach that Court for discharge of the order or file an appeal against the order. Therefore, Dr. Ghosh contended that the injunction order could not be treated as a nullity, so long as, the same was not vacated. He has further submitted that the Civil Court at Ludhiana has the jurisdiction to entertain the suit. Moreover, by a subsequent amendment, a part of the cases of action has also arisen, within the jurisdiction of the Courts at Ludhiana.

(41) In Sri Krishna Singh (supra), their Lordship of Supreme Court held that a judgment or an order, passed by a court, in defiance of and in disobedience of the clear verdict of the Supreme Court, would be honest and absolutely without jurisdiction and violative of Article 141 of the Constitution of India. Such an order, is absolutely non est and non existent, it need not be set aside, but would have to be completely ignored, as, if no such order was ever passed or existed.

(42) In Amrit Bhikaji Kale and others, (supra) their Lordships of Supreme Court held: "If Janardhan became the owner on April 1,1957 all subsequent proceedings in which the Tribunal held that the date of purchase was postponed because the recorded owner Ashoklal was a minor were without jurisdiction. The Tribunal had absolutely no jurisdiction to proceed on the footing that the date of sale was postponed. It is neither an incorrect order nor an erroneous order as was sought to be made out but Tribunal lacked the jurisdiction to proceed under Section 32-F because when the proceedings under Section 32-F were commenced, Janardhan had long since become the deemed purchaser. Therefore, all subsequent proceedings were abinitio void and without jurisdiction and the High Court was right in holding that orders passed therein were nullity. The attempt to overcome this position by urging that the order was erroneous was rightly repelled by the High Court holding that the orders were null and void, proceeding on an erroneous assumption of a jurisdictional fact that the recorded owner was a minor on the tillers' day. When a Tribunal of limited jurisdiction clutches at a jurisdiction by ignoring a statutory provision and its consequences in law on the status of parties or by a decision wholly unwarranted with regard to the jurisdictional fact, its decision is a nullity and can be set up in collateral proceedings. The Tribunal clutched at a jurisdiction not vested in it and in such a situation it cannot be disputed that the Tribunal lacked the jurisdiction to entertain any proceeding purporting to be between landlord and tenant on the erroneous assumption that tenant was still a tenant though he had long since become the deemed purchaser. The tenant has ceased to be a tenant much prior to the orders passed by the Tribunal on April 24.1961 and July 13, 1967 holding that the date of compulsory purchase was postponed. The compulsory purchase by the operation of law bad taken place as early as April 1, 1957 and that legal position cannot be wished away."

(43) The facts in the judgments, cited by learned counsel for petitioner, are different from the facts and circumstances, of the present case. The main grievance of petitioner is that the court of learned Sub Judge 1st Class, Ludhiana, has no territorial jurisdiction to entertain the suits, filed by the Company. The ex parte decree was passed on April 30. 1987 in suit No. 11 of 1987. Again the Company filed another suit No. 17 of 1988, when the learned Sub Judge 1st Class, Ludhiana, vide order dated January 15, 1988, granted a stay order, thereby restraining the petitioner and others, from dealing with the shares, debentures, dividends and interest, payable thereon. If petitioner has any grievance against the order, passed by the learned Sub Judge 1st Class, Ludhiana, then, petitioner should approach that Court by an appropriate application and raise all these contentions there. This Court is not sitting in appeal over the judgment/order, passed by the learned Sub Judge 1st Class, Ludhiana. In fact, this Court has no jurisdiction to go into the merits of the ex parte decree or the order, passed by the Civil Court at Ludhiana. In other words, this Court has no jurisdiction to decide the question, with regard to the jurisdiction of the Civil Court at Ludhiana, to entertain the suits, filed by the Company. The civil court at Ludhiana, is fully competent to decide the question, with regard to its jurisdiction to entertain the suits, filed by the Company against petitioner and other members of her family. So long as the decree and the other, passed by the learned Sub Judge 1st Class, Ludhiana, in the facts and circumstances of the present case, are not discharged or vacated, the same are binding upon the petitioner.

(44) The other facet of the argument of Mr. Bhat is, that under Section 41(b) of the Specific Relief Act, 1963, the court has no jurisdiction to restrain a person from initiating any proceedings in a court of law. He has placed reliance upon the Judgment in Cotton Corporation of India Limited v. United Industrial Bank Limited and others, .

(45) Dr. Shanker Ghosh, on the other hand, has contended that Section 41(b) of the Specific Relief Act, does provide that injunction cannot be granted to restrain any person, from instituting or prosecuting any judicial proceeding in a Court. But in the present case, the proceedings have already been instituted and the petitioner is being heard. The contention of the respondent is not that the matter cannot be heard or that there is any injunction, restraining the matter from being heard. According to Dr. Ghosh. Section 41(b) is not a provision, which renders injunction order useless or prevents the Court from passing an injunction order. This provision has nothing to do with the question, whether the rights of the party can be legally restrained or not, this Section only says that a party cannot be prevented from approaching the Court. But when a party approaches the Court, then the Court will naturally have to decide, whether the party has a right on merits, or whether his right is legally protected or legally restrained. A person, whose right has been legally restrained, can yet file a proceeding in the court, but. the Court will dismiss it not on the ground that he cannot approach the court, but on the ground that he has no right or that his right has been legally restrained, and as such, he has no case on merits. In other words. Dr. Ghosh has conceded that there is no restraint order against petitioner, from filing the present petition.

(46) Dr. Ghosh has also urged that petitioner cannot be granted the relief, because, her right has been curtailed by the restraint order. Unless the injunction order is vacated, the relief, as prayed, cannot be granted to petitioner. As the petitioner has been restrained from claiming the shares or debentures from the Company, so, on this ground alone, this Court will decline the reliefs and dismiss the petition. He has placed reliance upon the judgment in Eastern Trust Company v. Makenzie Mann & Co. Ld. A.I.R. 1915 Privy Council, 106.

(47) In Cotton Corporation of India Limited (supra), the facts were that United Industrial Bank Limited, filed a suit, on the original side of Bombay High Court against the Cotton Corporation of India Limited, and another, praying for a declaration that the acceptance and/or co-acceptance of the Bill of Exchange and/or Hundies, listed in Exhibit K by the other defendant, for and on behalf of the Bank was null and void and not binding on the Bank. and further, calling upon the Corporation to deliver up to the Court the disputed bills of exchange and/or hundies, for the purpose of cancellation. In the suit. United Industrial Bank Limited, took out a notice of motion, thereby seeking to restrain by an interim injunction the Corporation from enforcing any claim, whatsoever, in any form, or from relying on or giving effect to the bills of exchange or hundies, involved in the dispute, for the purpose of any suit or other proceedings, including winding up proceedings under the Companies Act. In appeal, filed by the Bank, Division Bench of the Bombay High Court issued an interim injunction, restraining the Corporation from presenting a winding up petition. While interpreting the provisions of Section 41(b) of the Specific Relief Act, their Lordships of Supreme Court held ; "It is, therefore, necessary to unravel the underlying intendment of the provision contained in Section 41(b). It must at once be conceded that Section 41 deals with perpetual injunction and it may as well be conceded that it has nothing to do with interim or temporary injunction which as provided by Section 37 are dealt with by the Code of Civil Procedure. To begin with, it can be said without fear of contradiction that anyone having a right that is a legally protected interest complains of its infringement and seeks relief through court must have an unhindered, uninterrupted access to law courts. The expression 'court' here is used in its widest amplitude comprehending every forum where relief can be obtain in accordance with law. Access to justice must not be hampered even at the hands of judiciary. Power to grant injunction vests in the court unless the Legislature confers specifically such power on some other forum.. Now access to court in search of justice according to law is the right of a person who complains of infringement of his legally protected interest and a fortiori therefore, no other court can by its action impede access to justice. This principle is deducible from the Constitution which seeks to set up a society governed by rule of law. As a corollary, it must yield to another principle that the superior court can injunct a person by restraining him from instituting or prosecuting a proceeding before a subordinate court. Save this specific carving out of the area where access to justice may be impeded by an injunction of the court, the Legislature desired that the courts ordinarily should not impede access to justice through court. This appears to us to be the equitable principle underlying Section 41(b). Accordingly, it must receive such interpretation as would advance the intendment, and thwart the mischief it was enacted to suppress and to keep the path of access to justice through court unobstructed. Viewed from a slightly different angle, it would appear that the legal system in our country envisages obtaining of redressal of wrong or relief against unjust denial thereof by approaching the court set up for the purpose and invested with power both substantive and procedural to do justice that is to grant relief against invasion or violation of legally protected interest which are jurisprudentially called rights. If a person complaining of invasion or violation of his rights is injuncted from approaching the court set up to grant relief by an action brought by the opposite side against whom he has a claim and which he wanted to enforce through court, he would have first to defend the action establishing that he has a Just claim and he cannot be restrained from approaching the court to obtain relief. A person having a legal right and complains of its violation or infringement, can approach the court and seek relief. When such person is injuncted from approaching the court, he has to vindicate the right and then when injunction is vacated, he has to approach the court for relief. In other words, he would have to go through the gamut over again : When defending against a claim of injunction the person vindicates the claim and right to enforce the same. If successful he does not get relief but a door to court which was bolted in his face is opened. Why should he be exposed to multiplicity of proceedings? In order to avoid such a situation the Legislature enacted Section 41(b) and statutorily provided that an injunction cannot be granted to restrain any person from instituting or prosecuting any proceeding in a court not subordinate to that from which the injunction is sought. Ordinarily a preventive relief by way of prohibitory injunction cannot be granted by a court with a view to restraining any person from instituting or prosecuting any proceeding and this is subject to one exception enacted in larger public interest, namely, a superior court can injunct a person from instituting or prosecuting an action in a subordinate court with a view to regulating the proceeding before the subordinate courts. At any rate the court is precluded by a statutory provision from granting an injunction restraining a person from instituting or prosecuting a proceeding in a court of coordinate jurisdiction or superior jurisdiction. There is an unresolved controversy whether a court can grant an injunction against a person from instituting or prosecuting a proceeding before itself but that is not relevant in the present circumstances and we do not propose to enlarge the area of controversy"

(48) In Eastern Trust Company (supra), the facts were that defendant, by an injunction, was restrained from receiving money from the Government, who was to pay the same as subsidy, but the Government with full notice of the injunction paid the money to defendant. The Privy Council held that when a party to suit was restrained by injunction, from receiving money from the Government, and knowing this, the Government paid the amount, the party, which received the amount, was guilty of contempt of Court.

(49) The facts of the case in Eastern Trust Company (supra), the quite different from the facts of the present case.

(50) By an order dated January 15, 1988, passed by the learned Sub Judge 1st Class, Ludhiana, defendants, in that suit, including the petitioner, were restrained, either by themselves or acting through their attorney, or any other person, from claiming the shares, debentures, dividends and interest, accruing thereon, from time to time, as the same were held by plaintiff, (the Company), as security against defendants. The learned Court at Ludhiana, did not restrain, and rightly so, the petitioner and other defendants from instituting any judicial proceeding They were restrained merely from claiming the shares, debentures, dividends and interest, accruing thereon from the Company. This order even does not imply that there is any restraint order against petitioner, for filing the present petition. Moreover, Dr. Shanker Ghosh, has fairly conceded that the order does not restrain petitioner, from instituting the present proceedings. I am of the view that petitioner was, entitled to institute a petition, under Section 113 of the Act.

(51) NOW. as argued by Dr. Ghosh, that on hearing the matter, the petition, filed by petitioner, should be dismissed on merits, as petitioner is a person, who, so long as, the stay order is subsisting, can not claim the relief and, as such, is not entitled to have the shares delivered to her. In other words, the arguments of learned counsel for Company are that rights petitioner have been legally curtailed and restrained. Though, petitioner can file the proceedings in the Court, but the Court should dismiss it, not on the ground that she cannot approach the Court, but on the ground that she has no right, as there is an injunction order against her.

(52) If I accept this argument of Dr. Ghosh, then, it will mean that though, there is no stay against petitioner from instituting the judicial proceedings under Section 113 of the Act, but after the institution, petition should be dismissed on the ground that there is a restrain order against petitioner.

(53) I am not holding that the Courts can ignore the decree or the order, passed by the other courts. But how far such decree or the order affects the rights of a party, depends upon the facts and circumstances of each case.

(54) In the present case, if the contention, made by Dr. Ghosh, is correct, then, the filing of the petition by petitioner, is just a formality. In other words, petitioner can file a petition, but only to get the same dismissed, on the ground that there is a stay order against her. The filing of the petition, thus will be a futile exercise. It can also mean that petitioner, in fact, could not initiate the judicial proceedings for the redressal of her rights. This is against Section 41(b) of the Specific Relief Act, 1963.

(55) The present petition has been filed under Section 113 of the Act, thereby claiming various reliefs. This section imposes certain statutory obligations upon a Company. Within three months, after the allotment of any of its shares, debentures or debentures stock and within two months of the application for registration of transfer of the shares, debentures stock, every Company shall complete and have ready for delivery, the certificates of all shares etc. If default is made in complying this provision, then the Company and every officer of the Company, who is in default, shall be punishable with fine, which may extend to Rs, 500.00 for every day during which the default continues. Under sub-section (3), if any Company, on which a notice has been served, thereby requiring it to make good any default, and fails to make good the default, within 10 days, after the service of notice, the Court may, on the application of the person, entitled to have the certificate or the debentures, delivered to him, make an order, directing the Company and any officer of the Company to make good the default, within such time, as may be specified in the order. Thus, statutory obligations as well the rights arise from Section 113 of the Act. If a default is committed within the meaning of sub-section (1) of Section 113 of the Act. then the Company and every officer of the Company, who is in default, is to face the penal consequences,

(56) It is also be noted that by the order of Mahinder Narain, J., the amount of dividend and the shares scrips have already been deposited by the Company in the Court,

(57) As held in Cotton Corporation of India Limited (supra), access of justice must not be hampered, even at the bands of judiciary. A person, having a legal right and complains of its violation or infringement, can approach the Court and seek relief.

(58) As far as the facts of the present case are cancerned, following the dictum of the Supreme Court in Cotton Corporation of India Ltd., (supra), I am of the view that the present petition cannot be dismissed, merely on the ground that there is an order, passed by the Civil Court at Ludhiana, against petitioner.

(59) Now, it is to be seen, whether petitioner is entitled to have the certificates or the debentures, delivered to her, under sub-section (3) of Section 113 of the Act.

(60) Petitioner had subscribed to the shares and debentures of the Company, and was allotted 29.000 shares on February 15, 1983 and 13974 shares on July 27, 1984. All these shares were equity shares of Rs. 10.00 each. After, the Company announced/offered issue of 18.14,400 equity shares and 13.5% redeemable non-convertible debentures on rights issue basis, petitioner sent in the necessary application for allotment of 25782 equity shares, at a premium of Rs. 15.00 per share, and for 8594 debentures of Rs. 100.00 each. The amount of Rs. 15,03,950.00 was admittedly paid from Canara Bank, London Branch, by a Demand Draft. This amount was duly deposited with the company's bankers to the issue, i.e. Hongkong Bank, New Delhi.

(61) The shares and debentures, were allotted to petitioner, on June 23, 1986. Under sub-section (1) of Section 113 of the Act, within 3 months after the allotment of its shares, or debentures, the Company was under a statutory obligation to complete and have ready for delivery the certificates of all shares, debentures, etc. It is also not in dispute that petitioner and other members of her family, who were also allotted shares, did send the letters and reminders to the Company, as well as to the Joint Secretary and Controller of Capital Issues, Government of India, Department of Economic Affairs, thereby demanding the delivery of the shares, either to them or to Canara Bank.

(62) The Company got approval of the Reserve Bank of India in May, 1987, to allot shares to the nonresident Indians. In its statement, Shri K. L. Jain, Director of the Company, stated that the only impediment for delivery of shares to the Jains was the injunction order, which had been passed against them. In its reply, the Company has also alleged that the shares could not be delivered, on account of the stay order dated January 15, 1988, passed by the learned Sub Judge 1st Class, Ludhiana.

(63) In his affidavit, dated August 23,1988, Shri R.K. Singhania, Director of the Company, has stated that as per the order dated July 27, 1988, passed by this Court, a meeting of the Board of Directors was held on August 19, 1988. It was resolved that the share certificates in the name of Mr. P.D, Jain and his family members be issued, in lieu of the letters of allotment, dated June 23, 1986. The shares certificates and the dividends have already been deposited in the Court.

(64) The entire amount towards the shares was deposited with the Company. The shares were also allotted to petitioner and other members of her family on June 23,1986. Service of notice on the company is also admitted. Hence, petitioner was fully entitled to move the present petition for having the certificates or the debentures, delivered to her. Und er the facts and circumstances of the case, I hold that petitioner is entitled to have the certificates and the debentures, delivered to her.

(65) However, it may be observed that the ex parte decree dated April 30, 1987, passed in suit No. 11 of 1987, by the learned Sub Judge 1st Class, Ludhiana, is still in force. Petitioner and other members of her family, under the decree, have been restrained from disposing off or repatriating the shares, debentures of the Company. This decree still is in force.

(66) Petitioner has also prayed for initiating the appropriate action against the Company for its failure to pay the dividends and to deliver the shares and debentures to her.

(67) I am not inclined to grant this relief, on the ground that approval of the Reserve Bank of India, was obtained by the Company in May, 1987, to allot the shares to the non-resident Indians. According to the Company, the dividends could not be paid and shares could not be delivered to petitioner and other members of her family, on account of the ex parte decree an subsequently the stay order. I accept this defense of the petitioner.

(68) Under the facts and circumstances of the case, petition is partly allowed. I direct that the shares certificates, debentures and dividends, now lying in deposit in the Court, be delivered and paid to petitioner, subject to her completing the other legal formalities, by the Registry. No order as to costs.