CANARA BANK versus NUCLEAR POWER CORPORATION OF INDIA LTD. AND ORS.

Citation: [1995] 2 S.C.R. 482 · Decided: 06-03-1995 · Supreme Court of India · Bench: J.S. VERMA · Disposal: Appeal(s) allowed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
CANARA BANK 
v. 
NUCLEAR POWER CORPORATION OF INDIA LTD. AND ORS. 
MARCH 6, 1995 
B 
[J.S. VERMA, S.P. BHARUCHA AND K.S. PARIPOORNAN, JJ.] 
Special Court (Trial of Offences relating to Transactions in Securities) 
Act, 1992-Section 9A-Whether Company Law Board a Court-Whether it 
is divested of the jurisdiction powers and authority to entertain matters .or 
C claims arising out of transactions in securities entered into between the stated 
dates in which a notified person is involved-Whether by reason of Sub-section 
(2) claims or matters pending"before it on the commencement of the Amend-
ment Ordinance stand transfen-ed to the Special Court-Yes. 
Companies Act, 1956 : 'Court' meaning of-Whether Company Law 
D Board is a Court. 
Wordr & Phrases: 'Court'-Meaning of in the context of sections 111 & 
155 of Companies Act, 1956. 
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The Canara Bank had made an application before the Company Law 
E Board (CLB) under section 111 of Comp,anies Act seeking relief against 
the Nuclear Power Corporation of India Ltd, which had refused to register 
in its books bonds of the Noel.ear Power Corporation purchased by Canara 
Bank. The Standard Chartered Bank had also claimed ownership of the 
said bonds. Canara Bank alleged that it had acquired the said bonds from 
F the Andhra Bank Financial Services Ltd, through a broker, a person 
notified under the provisions of Section 3(2) of the Special Court Act. The 
application of the Canara Bank was pending disposal before C.L.B. when, 
on 25th January, the Special Court Act was amended by the Special Court 
(Trial of offences relating to Transactions in Securities) Amendmet Or-
dinance, 1994 and Section 9-A was introduced. Tite Canara Bank and the 
G Nuclear Power Corporation took the stand that the application of Canara 
Bank stood transferred to the Special Court Act; the Standard Chartered 
Bank contended that the CLB retained the jurisdiction to deal with the 
application. The CLB held that it was not a court within the meaning of 
the Companies Act nor was it a civil court. Its jurisdiction was, therefore_, 
H ''unaffected by the provisions of Section 9-A(2) of the Special Court AcL 
482 
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. CANARA BANK v. NUCLEARPO\VERCORPN. 
483 
Aggrieved by the' order or CLB Canara Bank prererred the present appeal. A 
Allowing the appeal, this Court \ 
HELD: 1.1. Sub-secito~· cll ~r s~ction 9A or the'special Co~rt Act 
mandates tr.insrer to the Special Court or 'evecy suit, claim.or othe; legal 
proceedings'. (492-B) 
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· 1.2. The word "court" must be read in the context in which it ls used 
in a statute. It is permissible given the conteXt, to read it as comprehending 
. the courts of civil judicature and courts or tribunais exercising curial or 
judicial powers. In the context In which the word "court" Is ~ed In 'section 
9A of the Special Court Act, it Is intended to encompass all curial or · C 
judicial bodies \1-hich 'have the jurisdiction to' decide in~ttei:-s or claims; . 
int~r iilia, arising ou't of transactions .In seeuritie's -~ntered Into between the 
sbted dates in which a P.rson notified hi lnvolved.'(506-F] > . 
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.. 1.3. The judgine~t In Mis.' Harindar Budar Mills LuL.v. S~yarn Swidar. , D 
Jhunjhunwala and· Ors., (1962) 2 SCR 339 Is determinative In deciding . 
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whether a tribunal Is subject to the jurisdictions under A.136 and 227, but 
. It does not hold that a "court• Is only a court of Civil judleature In the 
hierarchy of courts: .. :. 
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Kihoto Holiohan v. Zachillhu and Ors, (1992) Suppl. 2 S.C.C. 651, E 
referred to. 
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2. The occasion for.enacting the Special Court Act most not be lost 
sight ot The, Statement of Objects and Reasons of the Bill to replac'e the 
Amendment Ordinance has been quoted. Joint Parliamentary Committee 
was constituted to Investigate what the Statement of Objects and Reasons . F 
called "the large scale irregularities and malpractices which were noticed 
In the Securities transactions of banks". (506-Gl ., 
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3. Having regard to the 1'J!ormity or the "scam" and its vast ramifica-
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lions, Parliament thought It was·necessary that all the matters or claims 
arising out of transaction in securities entered Into between th~· stated · G 
d

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