LexLADLI PRASAD JAISWAL versus KARNAL DISTILLERY CO., LTD., & ORS.
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1962 D1ambtr, 11, 270 SUPREME COURT REPORTS[l964]VOL. LADLI PRASAD JAISWAL v. KARNAL DISTILLERY CO., LTD., & ORS. (B. P. SmHA, C. J., P. B. GAJENDRAGADXAR, K. N. WANCHOn, K. C. DAS GUPTA ·and j. C. SHAH, JJ.) Company-Managing Direclor appoinWl an ,.,.,.uiin Unn&- Ruo/utian remooing Managing Direclor and appointing anoth<r-Genera/ lrf eetiTUj-Suhsequent resolution paa•ed canctJl. ing prwioUo! rt1olwian-8uit by th!, Direclor-FrauJ and undue inftumce on the part of th!, appellant alleged-Whetli<r firit appt/late court 1oent far beyond plP.adirigs-LeUera Patent Appeal-Certifir.air. undu Art. 133 (1) (a) of lhe Cc>n.1titutian- Whether r.ompelent-"Courl immediately below"-Court• aubordinate-Conatitution of India, Art. 133 (1) (a) and (b)- Companies Act, 1956(1of1956) s. 155-Code o/Cioil Procedure, 1908 (Acl V of J.908), 88. 100,110,0.6, r. 4-Indian Contrad Acl, 1872 (9 of 1872) •· 16. The appellant filed a suit in the Court of the Subordinate Judge for a declaration that certain resolution. of the directors and the shareholders in a private limited company passed on March 3 and 28, 1946, and at the meetings of the Directors held thereafter were illegal and void and for a declaration that the reiolutions of October 16, 1945, were operative and in force. ' The respondents resisted the suit contesting that respondents 2 to 5 were coerced by the appellant who took advantage of his dominating position, into passing the resolutions on October 16, 1945, and those resolution. were not binding on the company. The Subordinate.Judge, held that the written statements did not contain 'sufficient particulars of the pica of coercion and undue influence' and that the respondents having failed to give evidence in support of the plea of coercion and undue influence, the burden of proving which lay upon them the appellant's suit must be docrecd. In appeal the District Court held that the appellant was in a position to dominate the will of respondentlo 2 to 5 and he took advantage of that position and on that account the resolutions relied upon by the appellant dated October 16, 1945, were vitiated by coercion and undue influence, and the appellant could not get a decree relying upon those resolutions. The appellant appealed to the High Court. A single Judge of the High Court found that the District Judge 1 S.C.R. SUPREME COURT REPORTS 271 had 'travelled far beyond the pleadings' and therefore his find· ing• on issue of coercion and fraud could not be upheld. In an appeal under cl. 10 of the Letters Pat<nt a Division 3ench of the High Court found that the appellant was in a position to dominate and had obtained unconscionable advantage and it was for him to prove that the resolutions of October 16,1945, were not vitiated by coercion and fraud which burden he had failed to discharge. They further held that later resolutions of the company were not binding on the appellant because no notice was issued to him of the meeting of the company; but no decree could be granted to him since 'equity declines to lend its aid to a person whose conduct has been inequitable', A certificate of fitness was however granted to appeal to thi• Court under Art. 133 (I} (a} of the Constitution. Before this Court, it was urged that the appeal did not involve any substantial quesion of law and the High Court was not competent to grant the certificate under Art. 133 (l} (a} and (b}. It was submitted that the expression •Court Immediately lelow' in Art. i 33 meant a court subordinate to the High Court and a single Judge not being subordinate to a Division Bench of the High Court the •Court Immedj,ately below' was the District Court. Ii eld, that there is nothing in the phraseology used or the context which justified the view that the expression •Court immediately below' in Art. 133 (I) of the Constitution is used in two different senses according as the High Court is trying an appeal in a proceeding instituted in the High Court in exercise of the Original Jurisdiction, and a proceeding instituted in exercise of its appellate jurisdiction. The test for determining whether an aggrieved party has no right to appeal, other con- dition~being fulfilled is not whether the judgment is of a court subordinate, but whether the judgment is of a court immediate- ly below. The two expressions being different the same consi- derations do not apply in their interpretation. The certificate granted b
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