Limitation

Generally

— Determination of question of, as preliminary issue — Permissibility — As starting point of limitation has to be ascertained on facts in every case, held, plea of limitation cannot be decided as a abstract principle of law divorced from facts — Hence unless it becomes apparent from reading of the plaint/petition (company petition in this case), on the principle of demurrer that the same is barred by limitation, plaint/petition cannot be rejected under Or. 7 R. 11(d) — In present case, Company Judge, as affirmed by Division Bench, determining question of limitation of company petition filed under S. 155, Companies Act, 1956 for violation of S. 77, Companies Act, as a preliminary issue, and dismissing the same as being barred by limitation — Sustainability — Held, on principle of demurrer the company petition does not disclose that it is barred by limitation — Facts disclosed in petition, discussed in this regard — Company Judge could not have referred to affidavit-in-reply to determine the question of limitation at preliminary stage — Therefore, if facts in company petition were disputed, question of limitation could not have been determined at preliminary stage without a decision on facts after parties had been given opportunity to adduce evidence, (2006) 5 SCC 638-A

Limitation

Generally

— Nature of question of — Held, is a mixed question of fact and law, (2006) 5 SCC 638-B

Civil Procedure Code, 1908

— Or. 14 R. 2 — Questions that may be determined as preliminary questions — Mixed questions of fact and law — Held, CPC confers no jurisdiction on court to decide a mixed question of fact and law, unless the facts are clear from the plaint itself and the mixed question of fact and law can be determined on the principle of demurrer — Where a decision on an issue of law depends upon a decision of fact, it cannot be tried as a preliminary issue, (2006) 5 SCC 638-C

Civil Procedure Code, 1908

— Or. 14 R. 2 and Or. 7 R. 11 — Demurrer — Principle of — Explained in detail, (2006) 5 SCC 638-D

Corporate Laws

Practice and Procedure

— Generally — Applicability of CPC to proceedings under Companies Act, 1956, (2006) 5 SCC 638-E

Evidence Act, 1872

— S. 114 — Natural course of events — Affairs of a public limited company — Knowledge of, on part of small shareholders — Prima facie view expressed that it was quite probable that small shareholders would not be aware of the same in detail — The fact that one of such shareholders was partially involved in a many-step transaction to buy a company's shares with its own funds in violation of S. 77, Companies Act, 1956, does not lead to the only inference that he had knowledge of the entire transaction, (2006) 5 SCC 638-F

Limitation

Limitation Act, 1963

— S. 17 — Applicability — Petitioners claiming that respondents had acted in violation of S. 77, Companies Act, 1956 in causing shares of Company to be bought fraudulently by utilising funds of Company and consequently that register of Company needed to be verified in accordance with S. 155, Companies Act — Held, as petitioners were not claiming any right or title over shares of Company, it was S. 17(1)(a) that was applicable and not S. 17(1)(b) — Position obtaining under S. 18, Limitation Act, 1908 compared, (2006) 5 SCC 638-G

Civil Procedure Code, 1908

— Or. 6 R. 4 — Fraud — Particulars that need to be pleaded in respect of — Detail necessary — Discussed in detail — Instance given — Held, particulars of alleged fraud will depend upon facts of each particular case and no abstract principle can be laid down, (2006) 5 SCC 638-H

Corporate Laws

Companies Act, 1956

— Ss. 77 to 81 and 100 — Purchase of its own shares by company — Permissibility — Held, a limited company cannot purchase its own shares except in the manner laid down in the statute, (2006) 5 SCC 638-I

Corporate Laws

Companies Act, 1956

— Ss. 155 and 111 — Entry of name of person in register of company wrongfully obtained — Nature of wrong — Whether continuing wrong, so as to attract S. 22, Limitation Act, 1963 — Question left open, (2006) 5 SCC 638-J