BANSIDHAR SHANKARLAL versus MOHD. IBRAHIM & ANR.

BANSIDHAR SHANKARLAL versus MOHD. IBRAHIM & ANR.

Leave under section 171 of the Companies Act, 1913 is not a condition precedent for maintainability of execution proceedings against a company in liquidation; proceedings without leave are not liable to dismissal, and once leave is obtained, proceedings are deemed instituted on the date leave is granted. Supreme Court will not certify an appeal when the only issue has been decided against the applicant and it agrees with the High Court on the merits.

Parties
Appellant: Bansidhar Shankarlal; Respondent No. 1: Mohd. Ibrahim; Company (in Liquidation): Luxmi Spinning & Weaving Mills Ltd.
Jurisdiction
India
Judgment Date
25 September 1970
Procedural Posture
Civil Appeal / Appeal by Special Leave From Order of Calcutta High Court Refusing Certificate Under Article 133(1)(b) and (c) of Constitution
Outcome
Appeal dismissed
Legal Topics
Company Winding Up, Leave to Execute Against Company in Liquidation, Certificate for Appeal to Supreme Court, Execution Proceedings
Company Law Civil Procedure Constitutional Law Company Winding Up Leave to Execute Against Company in Liquidation Certificate for Appeal to Supreme Court Execution Proceedings

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Parties

Bansidhar Shankarlal

Appellant

Mohd. Ibrahim

Respondent No. 1

Luxmi Spinning & Weaving Mills Ltd.

Company (in Liquidation)

Procedural Posture

Civil Appeal / Appeal by Special Leave From Order of Calcutta High Court Refusing Certificate Under Article 133(1)(b) and (c) of Constitution

Legal Issues

  1. 1 Is leave under section 171 of the Companies Act, 1913 a condition precedent to institution and maintainability of execution proceedings against a company ordered to be wound up?
  2. 2 Should the High Court certify an appeal under Article 133(1)(b) or (c) of the Constitution when the only issue has been decided against the applicant?

Ratio Decidendi

Leave under section 171 of the Companies Act, 1913 is not a condition precedent for maintainability of execution proceedings against a company in liquidation; proceedings without leave are not liable to dismissal, and once leave is obtained, proceedings are deemed instituted on the date leave is granted. Supreme Court will not certify an appeal when the only issue has been decided against the applicant and it agrees with the High Court on the merits.

Court Disposition

Appeal dismissed

Orders

  • Appellant to pay costs of the plaintiff in Supreme Court