LexTAMILNAD MERCANTILE BANK SHARE HOLDERS WELFARE ASSOCIATION versus S.C. SEKAR AND ORS.
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[2008] 17 S.C.R. 85 TAMILNAD MERCANTILE BANK SHARE HOLDERS A WELFARE ASSOCIATION v. S.C. SEKAR AND ORS. (Civil Appeal Nos. 7129-7130 of 2008) DECEMBER 5, 2008 B [S.B. SINHA AND CYRIAC JOSEPH, JJ.] Contempt of Courts Act, 1971: s. 19 - Appeal against contempt - Association of shareholders of Bank - Annual c General Meetings - Non-holding of, for several ·years - Issuance of notice convening AGM, challenge. to, by Association - Interim order - Permission of holding of meeting only in respect of some items in Agenda ....:. Items in Agenda relating to election of directors adjourned - D Appointment of retired High Court Judge to hold AGM - ... Subsequently, AGM held and directors elected - Contempt Petition against Managing Director of Bank - Allegation of disobedience of interim order and that election of directors at AGM be declared null and void - Injunction order by a E different judge that resolution passed as regard election of · directors in AGM not to be implemented - Intra court appeal ~ by directors elected in AGM- Division Bench holding appeal to be maintainable - Interference· with - Held: Not called for -, - When order has been passed adverse to the interest of F alleged contemnor, appeal would be maintainable particularly where judgment has been passed by a court beyond its jurisdiction "'"'." Persons aggrieved could move the higher co&rt -Furthermore, if two views possible, contempt would not ~if! - On facts, interim order was obtained upon suppression of G facts - Association took recourse to forum shopping - They ~ were guilty of abuse of process of court, thus not entitled to equitable relief. ;. Doctrines/Principles: Doctrine of amity or comity - 85 H 86 SUPREME COURT REPORTS [2008] 17 S.C.R. A . Requires that different courts exercising separate jurisdiction pass similar orders - Even irregular order can be set aside by same court or by higher court. B Judiciary: Superior judiciary - Necessity of - Superior courts must discourage forl)m shopping. Equity: Person seeking equity must do equity - Party cannot take recourse to a machination which amounts to abuse of process of court - Administration of justice. C Tamilnad Mercantile Bank is carrying on banking business. Appellant-association are shareholders of the Bank. Its Annual General Meetings could not be held for · a number of years. 83rd Annual General Meeting of the Bank was to be held on 27th July, 2006. There were six 0 items of the agenda, item no. 1, 2 and 6 and item no.3, 4 and 5 relating to filling up of the posts of the directors. Pursuant to the injunction orCler dated 26th July 2006 passed by the High Court, meeting was held in respect of item no. 1, 2 and 6 of the Agenda and item Nos. 3, 4 and 5 were adjourned. Bank filed application seeking E directions as regards holding of 84th Annual General Meeting, claiming that 84th Annual General Meeting could not be convened unless 83rd Annual General Meeting was held as per law. By order dated 27th March 2008, Single Judge of High <;;ourt appointed Justice R. F Balasubramaniam, Judge (Retd) High Court, Madras to chair the 83rd, 84th and 85th Annual General Meetings. Single Judge of High Court, by order dated 29th April 2008, directed that Annual General meeting would be held but any resolution passed therein would not be G implemented until orders of the Court and dispute pertaining to convening of Annual General Meeting would be dealt with by this Court only. Appellant filed application · seeking injunction restraining holding of election of the Directors alone. Meanwhile Annual General Meeting was H held on 5th June, 2008 under the Chairmanship of ' .. - TAMILNAD MERCANTILE BANK SHARE HOLDERS 87 WEL. ASSO. v. S.C. SEKAR AND ORS. Justice R. Balasubramaniam. Appellant filed an intra A court appeal against the order dated 29th April, 2008 which was dismissed. Thereafter, it filed Contempt Petition against the Managing Director of the Bank, G. Narayanamurthy for alleged disobedience of order dated 26th July, 2006; and that the election of directors held at B the 83th, 84th and 85th Annual General Meeting be declared null and void. Matter came up before another Judge. He was not disclosed about the previous proceedings filed from time to time. Single Judge passed an ex parte interim order and restrained G. c Narayanamurthy from implementing the resolution or item of business in relation to the election
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