R.R. Rajendra Menon (No. 1) vs Cochin Stock Exchange Ltd.

K. John Mathew, J.—This is a company petition filed u/s 257 read with Section 10 of the Companies Act, 1956. The relief prayed for are the following:

(1) To direct the respondent to circulate exhibit P-2 among the members of the respondent.

(2) To grant such other reliefs including interim reliefs as may be prayed for.

Exhibit P-2 is a letter addressed by the petitioner to the Assistant Secretary, Cochin Stock Exchange Ltd., giving notice of his intention to move a resolution proposing himself as a candidate for election to the council of management of the stock exchange. When this company petition came up for admission, Sri Joseph Vellappally took notice on behalf of the respondent. He raised a preliminary objection that the petition itself was not maintainable. Even though I partly heard on that question, I wanted learned counsel to inform me about the reasons, if any, for which exhibit P-2 nomination was not circulated as required under the Articles and. posted the matter at 1.45 p.m. By that time learned counsel for the respondent had prepared and filed an affidavit of the President of the Cochin Stock Exchange and further arguments were heard.

As per the averments in the petition, the petitioner is a member of the respondent-stock exchange. He has received exhibit P-1 notice for the eleventh annual general meeting of the respondent stock exchange to be held on October 7, 1989. Exhibit P-1 notice is dated September 8, 1989. According to the petitioner, he sent exhibit P-2 letter giving notice of a resolution proposing himself to be appointed as a member of the council of management of the stock exchange in the vacancy arising due to the retirement of Shri P. S. Joseph. Exhibit P-3 is the postal acknowledgment of that letter. It is also stated that he paid Rs. 500 through a crossed account payee cheque drawn in favour of the respondent. He also filed Form No. 29 with the Registrar of Companies, Kerala, expressing his consent to act as a member of the management, if appointed. The copy of the receipt is marked as exhibit P-4.

According to the petitioner, the respondent ought to have informed its members about the petitioner''s intention to move the resolution proposed in exhibit P-2, by serving individual notices on the members not less than seven days before the meeting. The grievance of the petitioner is that the respondent neglected to comply with its statutory duty and did not inform its members about exhibit P-2 notice. It is on these averments that the petitioner has filed this company petition to direct the respondent to circulate exhibit P-2 among the members of the respondent.

The preliminary objection raised by learned counsel for the respondent is that although Section 257 of the Companies Act imposes certain duties on the company, if that provision is violated, such violation will not attract the jurisdiction of this court and Section 10 of the Act does not invest the company court with jurisdiction over any such violation.

Almost a similar question was considered by M. P. Menon J. in R. Prakasam Vs. Sree Narayana Dharma Paripalana Yogam, . His Lordship held that the grievance of the petitioner therein pertains to the realm of individual rights of alleged wrongs done to individual members and not to the realm of corporate rights, and that the petitioner could possibly insist on strict observance of the relevant provisions by recourse to a civil court. It was also held that the company court had no jurisdiction to grant relief in a matter like that. The particular Section that was dealt with by the learned judge in that decision was Section 166. Section 257 is also similar provision and the reasoning of that judgment, with which I respectfully agree, is equally applicable to the facts of this case.

Even so, I wanted to ascertain from learned counsel the reason for not circulating the nomination. Learned counsel showed me the relevant file containing a registered letter dated September 18, 1989, sent by the petitioner to the Assistant Secretary, Cochin Stock Exchange. On the seal affixed to that letter, it is noted that the Serial No. was 2859 and it was received on September 19, 1989. The inward register of, the stock exchange was also shown to me. At page 78 of that register is Serial No. 2859 and the entry shows that a letter dated September 18, 1989, from the petitioner was received on September 19, 1989. According to learned counsel for the respondent, only one letter was received on September 19, 1989, and that is the one shown to me, produced in court. Affidavit of the president of the stock exchange is to the same effect. It is not necessary at this stage to examine the contention raised by learned counsel for the respondent that the petitioner is only attempting to get some relief by production of a letter created for this company petition since I am holding that the petition is not maintainable.

The petition is dismissed as not maintainable.