KIIT Respondent

R410 BEFORE THE HON’BLE SUPREME COURT OF ISLANDIA Civil Appeal No.____/2016 [UNDER ARTICLE 136 OF THE CONSTITUTION OF ISLANDIA] IN THE MATTER OF

Mr. James Mc.Linden …………………………………………………APPELLANT

Vs.

Mr. Christopher Ryland .……………………….….………………RESPONDENT

ON SUBMISSION MEMORIAL ON BEHALF OF THE RESPONDENT

THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 Table of Contents INDEX OF AUTHORITIES ........................................................................................................ 3 ABBREVIATIONS USED ........................................................................................................... 7 STATEMENT OF JURISDICTION ........................................................................................... 8 STATEMENT OF FACTS ........................................................................................................... 9 STATEMENT OF ISSUES ........................................................................................................ 10 SUMMARY OF ARGUMENTS................................................................................................ 11 ARGUMENTS ADVANCED..................................................................................................... 12 1. Whether the issue of limitation was required to be heard as a preliminary issue in terms of S. 9A of CPC? ........................................................................................................... 12 A. ‘Jurisdiction’ in S.9A of CPC does not subsume Issues of Limitation. ............................ 12 B. The suit is not barred by Limitation .................................................................................. 15 2. Whether the age limit of 70 years under S. 196(3) (a) of the Companies Act, 2013 can apply to a WTD validly appointed prior to 01. 04. 2013? .................................................... 16 A. Concept of Retrospectivity & S.196(3)(a) ........................................................................ 16 3. Whether the word ‘continue’ used in S. 196(3) ought to be construed in context of 196(3) (b), (c), (d) alone and not to 196(3) (a)?...................................................................... 19 A. Literal rule of interpretation .............................................................................................. 19 B. Purposive Construction not applicable .............................................................................. 22 4. Whether S.196(3)(a) of the 2013 Act operates as an immediate disqualification on the appointment and continuation of a person as WTD or whether it is an eligibility condition which only applies at the time of appointment and whether there is any distinction between the two?................................................................................................... 24 A. A disqualification and not a merely an eligibility condition ............................................. 24 B. Experience nor sympathy can have a bearing on mid-tenure cessation ............................ 25 C. Operation of Proviso.......................................................................................................... 26 PRAYER ...................................................................................................................................... 28

MEMORIAL ON BEHALF OF RESPONDENT 2

THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 INDEX OF AUTHORITIES

INDIAN CASES A.Umarani v. Registrar Co-op. Societies, AIR 2004 SC 4504. .................................................... 18 Ashwani Kumar v. State of Bihar, 1995 SCALE (6) 779. ............................................................ 24 Babu Verghese & Ors vs Bar Council Of Kerala P.Rajangam, (1999)3 SCC 422....................... 25 Balvant N. Viswamitra v. Yadav Sadashiv Mule, (2004) 8 SCC 706. ......................................... 13 Bank of Baroda v. Moti Bhai, AIR 1985 SC 545. ........................................................................ 13 Bashiruddin Ashraf v. Bihar Subai Sunni Majlis-A waqf, AIR 1965 SC 1206............................ 16 Bharat Singh v. Management of New Delhi Tuberculosis Centre, AIR 1986 SC 842. ................ 16 Bharathidasan University v. All India Council for Technical Education, [2001] 8 SCC 676. ..... 22 Central Bank of India v. Ravindra, AIR 2001 SC 3095 at p.3114. .............................................. 21 CIT v. Indian Bank Ltd., [1965] 56 ITR 77 (SC) ......................................................................... 20 CIT v. ShahzadaNand& Sons, [1966] ITR 392 (SC).................................................................... 20 Collector (LA) v. Katiji, (1987) 2 SCC 107. ................................................................................ 14 Darshan Singh v. Ram Pal Singh, 1992 Supp(1)SCC 191. .......................................................... 15 Dental Council of India v. HariPrakash, [2001] 8 SCC 61. .......................................................... 22 Dilip v. Mohd. Azizul Haq, AIR 2000 SC 1976..................................................................... 16, 17 Glaxo Laboratories (I) Ltd. v. Presiding Officer, AIR 1989 SC 505............................................ 19 Gurudevdatta VKSSS Maryadit v. State of Maharastra, AIR 2001 SC 1980................... 19, 20, 21 Hari Vishnu Kamath v. Ahmad Ishaque, AIR 1955 SC 233. ....................................................... 25 Hira Lal Patni v. Kali Nath, AIR 1962 SC 199. ........................................................................... 13 In Ramesh D. Desai & Ors. v. Bipin Vadilal Mehta and Ors., (2006) 5 SCC 638. ..................... 12 Ittyavira Mathai v. Varkey, 1964 SCR (1) 495. ............................................................................ 13 K. Ramanujan Nair v. S. Sarojini Amma and Anr., 1971 CriLJ 565. .......................................... 13 Kamalakar Eknath Salunkhe v. Baburav Vishnu Javalkar & Ors., (2015) 7 SCC 321. ............... 11 Lalit Mohan Pandey v. Pooran Singh, AIR 2004 SC 2303. ......................................................... 19 Mahesh Chandra Gupta v. Union of India, (2009)8 SCC 273. ..................................................... 22 Maruti Udyog Ltd. v. Ram Lal,AIR 2005 SC 851........................................................................ 18 National Textile Workers’ Union v. P.R. Ramakrishnan, [1983] 1 SCC 228. ............................. 22 MEMORIAL ON BEHALF OF RESPONDENT 3

THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 New Piece Goods Bazaar Co. Ltd. v. CIT, [1988] 173 ITR 216 (Guj.). ...................................... 21 P.Rajangam, Sub Inspector of Police v. State of Madras, AIR 1959 Mad. 294. .......................... 25 Pramod Kumar v. U.P.Secondary Education Services Commission, (2008) 7 SCC 153 ............. 24 Praveen Singh v. State of Punjab, (2000) 8 SCC 436................................................................... 23 Prit Singh v. S.K.Mangal, 1993 Supp (1) SCC 714...................................................................... 24 Punjab University v. Devjani Chakrabarti, (1984) 3 SCC 612. .................................................... 23 Punjab University v. Subhash Chander, (1984)3 SCC 603. ......................................................... 16 Raghunandan Saran Ashok Saran v. PeareyLal, AIR 1986 SC 1682. .......................................... 20 Rajendra Agricultural University v. Ashok Kumar Prasad &Ors., (2010) 1 SCC 730 ................ 15 Ramji Missar v. State of Bihar, AIR 1963 SC 1088. .................................................................... 25 Rananjaya Singh v. Baijnath Singh, AIR 1954 SC 749................................................................ 22 Rashid Bibi v. Tuftail Muhammad, AIR 1941 (Lah) 291-92. ...................................................... 17 S.P. Gupta v. President of India, AIR 1982 SC 149. .................................................................... 18 Satpuda Tapi Parisar Sahakari Sakhar Karkhana Ltd. v. Jagruti Industries & Anr., 2008 (5) Bom CR 284 (Aurangabad Bench). ................................................................................................... 12 Satti Paradesi Samadhi & Philliar Temple v. M. Sankuntala (D) Tr. Lrs. & Ors., (2015) 5 SCC 674 ............................................................................................................................................. 12 Shah Bojraj Mills v. Subash Chandra, AIR 1961 SC 1596. ......................................................... 17 Shiv Shakthi Co-operative Housing Society v. Swaraj Developers, AIR 2003 SC 2434. ........... 20 ShyamSundar v. Raj Kumar, [2001] 8 SCC 24. ........................................................................... 17 Sridhar Sundararajan v. Ultramarine & Pigments Ltd., Feb 8, 2016, APPL/632/2015. ......... 17, 20 State of Bihar v. Maharajadhiraj Sri Kameshwar Singh, AIR 1952 SC 252. ......................... 17, 25 State of Himachal Pradesh v. Surinder Singh Banolta, 2006 (2) ShimLC 237. ........................... 24 State of J&K v. Shiv Ram Sharma (1999)3 SCC 653. ................................................................. 23 State of M.P v. DharamBir, (1998) 6 SCC 165. ........................................................................... 23 State of Orissa v. Mamata Mohanty, (2011) 3 SCC 436. ............................................................. 24 State of Rajasthan v. Mrs. Leela Jain, AIR 1965 SC 1296. .......................................................... 19 State of TN v. Aroorran Sugars Ltd., AIR 1997 SC 1815. ........................................................... 18 State of Uttar Pradesh v. Manbodhan Lal, AIR 1957 SC 912 ...................................................... 25 Swedesh Match AB v. Securities Exchange Board of India, AIR 2004 SC 4219. ....................... 18 T. Devadasan v. Union of India, AIR 1964 SC 179 ..................................................................... 25 MEMORIAL ON BEHALF OF RESPONDENT 4

THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 Tata Cellular v. Union of India, (1994) 6 SCC 65. ....................................................................... 23 Utkal C&J (P) Ltd. v. State of Orissa, AIR 1987 SC 2310........................................................... 16 Virendra Singh Hooda v. State of Haryana, AIR 2005 SC 137. ................................................... 17

TEXTBOOKS G.P. Singh, Principles of Statutory Interpretation113 (7th ed., 1999) ........................................... 21 FOREIGN CASES Abley v. Dale (1851) 11 C.B. 378 ................................................................................................ 19 BBC Enterprises v. Hi-Tech Xtravision Ltd., (1990) 2 All ER 118 ............................................. 21 Government of Pakistan v. Akhlaque Hussain, PLD 1965 SC 527. ............................................. 23 London & North West Railway v. Evans [1893] 1 Ch. 186, 27. .................................................. 21

BOOKS REFERRED 1. Avtar Singh, Company Law (16th ed., 2016) 2. Bakshi.P.M, Interpretation of Statutes (1st ed. Reprint, 2010) 3. Banerjee.S.C, Law of Specific Relief (17th ed., 2015) 4. Bharat’s Companies Act (15th ed., 2010) 5. Bhattacharyya.T, The Interpretation of Statutes (4th ed., 2001) 6. Dr.Chandratre.K.R, Guide to Company Directors (4th ed., 2003) 7. Durga Das Basu, Commentary on the Constitution of India (8th ed., 2007) 8. Gandhi.B.M, Interpretation of Statutes (2nd ed., 2014) 9. Justice Subramani.S.S, Law of Limitation and Prescription (14th ed., 10. Justice Venkatachaliah, Basu’s Code of Civil Procedure (11th ed., 2015) 11. Justice Yog.A.K, Interpretation of Statutes (1st ed., 2009) 12. Kafaltiya.A.B, Interpretation of Statutes, Universal Law Publishing Co. 13. Mathur.D.N, Introduction to Interpretation of Statutes (2nd ed., 2005) 14. Mitra.S.C&Kataria.R.P, Commentary on the General Clauses Act, 1897 (2nd ed., 2015) 15. Mittal.D.P, Interpretation of Statutes (2nd ed.) 16. Ramaiya’s Guide to the Companies Act, 2013 (18th ed., 2015) 17. Rao.M.N&AmitaDhanda, N.S.Bindhra’s, Interpretation of Statutes (10th ed., 2015) MEMORIAL ON BEHALF OF RESPONDENT 5

THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 18. Saharay.H.K&Saharay.M.S, Goyle’s Supreme Court Guide to Words & Phrases (4th ed., 2005) 19. Singh.G.P, Principles of Statutory Interpretation (12th ed., 2010) 20. St. Langan.J, Maxwell on Interpretation of Statutes (12th ed., 1969) 21. Takwani.C.K, Civil Procedure with Limitation Act (7th ed., 1963) 22. Vepa.P.Sarathi, Interpretation of Statutes (5th ed., 2013)

LEGAL DATABASES 1. All India Reporter 2. Manupatra 3. SCC Online

STATUTES REFERRED 1. The Code of Civil Procedure, 1908 2. The Companies Act, 1956 3. The Companies Act, 2013 4. The Constitution of India, 1950 5. The General Clauses Act, 1897 6. The Limitation Act, 1963 7. The Specific Relief Act, 1963

LEXICONS REFERRED 1. Justice L.P.Singh & Majumdar.P.K, Judicial Dictionary (3rd ed., Reprint, 2010) 2. P. RamanathaAiyer’s Concise Law Dictionary (5th ed., 2014)


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 ABBREVIATIONS USED

(P) Ltd.

Private Limited

¶

Paragraph

&

And

AIR

All India Reporter

Anr.

Another

Art.

Article

Bom.

Bombay

Co.

Company

Corp.

Corporation

ed.

Edition

et al.

And others

Ker.

Kerala

KMP

Key Managerial Personnel

Ors.

Others

p.

Page no.

pp.

Pages

SC

Supreme Court

SCC

Supreme Court Cases

S.

Section

Spl.

Special

Suppl.

Supplementary

U.S

United States

v.

Versus

Vol.

Volume

WTD

Whole Time Director


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016

STATEMENT OF JURISDICTION

The appeal is filed under Art. 136 of the Constitution, challenging the order and decretal order passed by the Division Bench of the High Court of Winchester , confirming the order passed by the learned single Judge of the said Court , granting injunction till the disposal of the suit. This Hon’ble Court was pleased to grant leave. In view of this, the Hon’ble court has got jurisdiction to decide the issues raised by the appellant.



STATEMENT OF FACTS

•

Goodenough Limited is a public limited company. Mr. James McLinden was appointed as a whole time director for a period of 5 years, as per the requirements of the Companies Act 1956.

•

On 1st April 2013, the Companies Act 2013 was soon passed and S.196 (3) of the Act provided that no company shall appoint or continue the employment of a person who has attained the age of 70 years.

•

On 15th April 2013, Mr. James McLinden attained the age of 70. On 12th May 2016, Mr.Christopher Ryland, a shareholder of the company filed a suit in the High Court of Winchester challenging the continuation of Mr. James McLinden as whole time director, along with a Notice of Motion seeking urgent interim relief restraining him from continuing and exercising powers as WTD.

•

In response to the Notice of Motion, Mr. James contended that by virtue of S. 9A of CPC his claim of the suit being barred under the Limitation Act should be heard as a preliminary issue.

•

The learned Single Judge ruled in favour of Mr. Christopher Ryland and the order was challenged by Mr. James McLinden in an appeal before the Division Bench of the High Court of Winchester. The Division Bench upheld the order of the Single Judge and dismissed the appeal.

•

Mr. James McLinden thus, has filed a Special Leave Petition before the Supreme Court, for which leave has been granted.



STATEMENT OF ISSUES ISSUE 1: WHETHER THE ISSUE OF LIMITATION WAS REQUIRED TO BE HEARD AS A PRELIMINARY ISSUE IN TERMS OF S.9A of CODE OF CIVIL PROCEDURE? ISSUE 2: WHETHER THE AGE LIMIT OF 70 YEARS UNDER S. 196(3)(a) OF THE COMPANIES ACT 2013, CAN APPLY TO A WTD VALIDLY APPOINTED PRIOR TO 01. 04. 2013?

ISSUE 3: WHETHER THE WORD ‘CONTINUE’ USED IN S.196(3) OUGHT TO BE CONSTRUED IN CONTEXT OF 196(3) (b), (c), (d) ALONE AND NOT 196(3) (a)?

ISSUE 4: WHETHER S.196 (3) (a) OF THE 2013 ACT OPERATES AS AN IMMEDIATE DISQUALIFICATION ON THE APPOINTMENT AND CONTINUATION OF A PERSON AS WTD OR WHETHER IT IS AN ELIGIBILITY CONDITION WHICH ONLY APPLIES AT THE TIME OF APPOINTMENT AND WHETHER THERE IS ANY DISTINCTION BETWEEN THE TWO?



SUMMARY OF ARGUMENTS

ISSUE-1: THE ISSUE OF LIMITATION WAS NOT REQUIRED TO BE HEARD AS A PRELIMINARY ISSUE IN TERMS OF S.9A of CPC. The issue pertaining to Limitation need not be heard as a preliminary issue under S.9A CPC, because it does not come within the ambit of ‘jurisdiction’. Moreover, this particular suit is not barred by Limitation Act, 1963.

ISSUE-2: THE AGE LIMIT OF 70 YEARS UNDER S. 196(3)(a) OF THE COMPANIES ACT 2013, APPLIES TO A WTD, VALIDLY APPOINTED PRIOR TO 01. 04. 2013. S.196(3)(a) cannot be termed retrospective merely because it governs an appointment made prior to the passing of Companies Act 2013. Arguendo, retrospective legislation to take away existing rights within its sweep is valid and there is no role of sympathy in construing such statutes.

ISSUE-3: THE WORD ‘CONTINUE’ USED IN S.196(3) OUGHT TO BE CONSTRUED IN THE CONTEXT OF S.196 (3) (a), (b), (c) AND (d). The word ‘continue’ ought to be construed in the context of S.196 (3) clauses(a), (b), (c) and (d) by invoking the rule of Literal Interpretation, the basic cannon of construction that the statute must be read as a whole and the non-applicability of the rule of purposive interpretation.

ISSUE-4: S.196 (3) (a) OF THE 2013 ACT IS AN IMMEDIATE DISQUALIFICATION WHICH APPLIES EVEN AFTER THE TIME OF APPOINTMENT. S.196(3)(a) operates as an immediate disqualification on account of Loquitur utvulgus; the fact that experience nor sympathy can have any bearing on the operation of mid-tenure cessation and interpretation of the proviso , being the other reasons for the same .


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 ARGUMENTS ADVANCED

1. Whether the issue of limitation was required to be heard as a preliminary issue in terms of S. 9A of CPC? It is submitted that the issue pertaining to Limitation need not be heard as a preliminary issue as: A. Ambit of ‘issues pertaining to jurisdiction’ in S.9A CPC does not include limitation; B. The suit is not barred by Limitation Act, 1963. A. ‘Jurisdiction’ in S.9A of CPC does not subsume Issues of Limitation. i.

The Supreme Court in Kamalakar Eknath Salunkhe v. Baburav Vishnu Javalkar & Ors.1, while considering S.9A of the Maharashtra Amendments of CPC, categorically stated that a claim of a suit being barred by limitation would not entitle the appellants to project it as a matter pertaining to jurisdiction and claim that it had to be heard as a preliminary issue under the aforesaid section: “17.The expression “jurisdiction” in Section 9A is used in a narrow sense, that is, the Court's authority to entertain the suit at the threshold. The limits of this authority are imposed by a statute, charter or commission. If no restriction is imposed, the jurisdiction is said to be unlimited. The question of jurisdiction, sensustricto, has to be considered with reference to the value, place and nature of the subject matter. The classification into territorial jurisdiction, pecuniary jurisdiction and jurisdiction over the subject matter is of a fundamental character. Undoubtedly, the jurisdiction of a Court may get restricted by a variety of circumstances expressly mentioned in a statute, charter or commission. This inherent jurisdiction of a Court depends upon the pecuniary and territorial limits laid down by law and also on the subject-matter of the suit. While the suit might be barred due to noncompliance of certain provisions of law, it does not follow that the non-compliance with the said provisions is a defect which takes away the inherent jurisdiction of the Court to try a suit or pass a decree. The law of limitation operates on the bar on a party

1

KamalakarEknathSalunkhe v. Baburav Vishnu Javalkar&Ors., (2015) 7 SCC 321.


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 to agitate a case before a Court in a suit, or other proceedings on which the Court has inherent jurisdiction to entertain but by operation of the law of limitation it would not warrant adjudication. ii.

A perusal of the Statement of Object and Reasons of the Amendment Act, 1970 would clarify that Section 9A talks of maintainability only on the question of inherent jurisdiction and does not contemplate issues of limitation. The sole reason of inserting S.9A was to curb the practice of granting injunctions in the City Courts, without going into the issue of jurisdiction, even though raised. •

iii.

Order XIV Rule 2& S.9A of CPC Order XIV Rule 2 of CPC provides that if the Court is of the opinion that a suit may be disposed of on the issue of law only then it may try that issue first; if it relates to jurisdiction of the Court or a bar to the suit created by any law for the time being in force. A plea of limitation cannot be decided as an abstract principle of law divorced from facts as in every case the starting point of limitation has to be ascertained which is entirely a question of fact. The Court further proceeded to state that a plea of limitation is a mixed question of fact and law.2 In Satti Paradesi Samadhi & Philliar Temple v. M. Sankuntala (D) Tr. Lrs. &Ors.3, it

iv.

was held that an issue of limitation, being an issue requiring inquiry into fact cannot be tried as a preliminary issue. Section 9A of CPC is not inconsistent with the provisions of Order 14 Rule 2 and will therefore bot stand repealed by S.16 of the Code of Civil Procedure of the Code Amendment Act 20024. Therefore, the logical inference to be made here is that an issue of limitation cannot be tried as a preliminary issue , even by invoking S.9A of CPC. • v.

Decoding the Concept of ”Lack of Jurisdiction” A “ practical definition of ‘Lack of jurisdiction’ can be said to be; the circumstance wherein a case is outside the purview of a court by the virtue of any reason which renders the matter wholly outside its jurisdiction. In Hira Lal Patni v. Kali Nath5, the concept of lack of jurisdiction was explained in the following words: “The validity of a decree can

2

In Ramesh D. Desai &Ors. v. Bipin Vadilal Mehta and Ors., (2006) 5 SCC 638. Satti Paradesi Samadhi &Philliar Temple v. M. Sankuntala (D) Tr. Lrs. &Ors., (2015) 5 SCC 674. 4 SatpudaTapi Parisar Sahakari Sakhar Karkhana Ltd. v. Jagruti Industries &Anr., 2008 (5) Bom CR 284 (Aurangabad Bench). 5 Hira Lal Patni v. Kali Nath, AIR 1962 SC 199. 3


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 be challenged in execution proceedings only on the ground that the court which passed the decree was lacking in inherent jurisdiction in the sense that it could not have taken cognisance of the case because the subject matter was wholly foreign to its jurisdiction or that the defendant was dead at the time the suit had been instituted or decree passed, or some such other ground which could have the effect of rendering the court entirely lacking in jurisdiction in respect of the subject matter of the suit or over the parties to it.” vi.

The further interpretation of this decision is that, in the event that a court lacks inherent jurisdiction to decide a matter, the validity of the decree can be challenged at any stage6 and such a decree may be nullified by the court and the decree would be nonest and void ab initio. However, for the decree or order to be nullified on the plea of lack of jurisdiction, the court must inherently lack jurisdiction. •

vii.

Inherent Lack of Jurisdiction & Concept of Limitation For there to exist an inherent lack of jurisdiction, the subject matter to be decided in the suit should be outside the jurisdiction. Lacking jurisdiction of other natures such as pecuniary or territorial jurisdiction cannot be said to be an inherent lack of jurisdiction.7. On the question of jurisdiction, one must always have regard to the substance of the matter and not the form of the suit”8. The case of Ittyavira Mathai v Varkey9 lays down this well settled principle that so long as a court has the jurisdiction in a suit with respect to its subject-matter, it cannot be said to be lacking jurisdiction . It was held that a court having jurisdiction over the subject matter of the suit and over the parties thereto, though bound to decide right may decide wrong, and that even though it decided wrong it would not be doing something which it had no jurisdiction to do. In other words, courts having jurisdiction to decide right or to decide wrong and even though decide wrong, the decree rendered by them cannot be treated as nullity.

viii.

Therefore, it is clear that even if a suit is barred by limitation, it does not mean that court ‘lacks’ jurisdiction to try the suit. It is a well-known fact that under S.5 of the Limitation Act, 1963, the Court may permit condonation of delay if the party is able to show “sufficient cause” in instituting the plaint after the prescribed period.

6

Balvant N. Viswamitra v. Yadav Sadashiv Mule, (2004) 8 SCC 706. K. Ramanujan Nair v. S. Sarojini Amma and Anr., 1971 CriLJ 565. 8 Bank of Baroda v. Moti Bhai, AIR 1985 SC 545. 9 Ittyavira Mathai v. Varkey, 1964 SCR (1) 495. 7


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 ix.

Further, In Collector (LA) v. Katiji10, the Supreme Court laid down the following principles, while dealing with an appeal or application not preferred within the period of limitation: 1. Ordinarily a litigant does not stand to benefit while lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. “Every days delays must be explained” does not mean that a pedantic approach should be made. Why not every hour’s delay, every second’s delay? The doctrine must be applied in a rational, common - sense pragmatic manner. 4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right in injustice being done because of a non – deliberate delay. 5. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact, he runs a serious risk. 6. It must be grasped that judiciary is respected not on account of its power to legalise injustice on technical grounds but because it is capable of removing injustice and is expected to do so.11 7. Thus, it is clear that even when a court refuses to take up a plaint citing that it is barred by limitation, it does not mean it lacks jurisdiction. Thus issues pertaining to jurisdiction in S.9A does not contemplate issues of limitation; the petitioners therefore cannot claim that it has to be heard as a preliminary issue. B. The suit is not barred by Limitation

x.

As is clearly evident through S. 1(3) of the Companies Act, 2013, every other provision other than Section 1, comes into force only on such date as the Central Government, by

10

Collector (LA) v. Katiji, (1987) 2 SCC 107. id, at p.108.

11


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 notification in the Official Gazette, appoints, and any reference in any provision to the commencement of the Act shall be construed as a reference to the coming into force of that provision12. xi.

In Rajendra Agricultural University v. Ashok Kumar Prasad &Ors.13, it was held that until publication in the Official Gazette, Statute is considered as “Statute in the making” or a “Statute in the process”; it is neither incomplete nor effective nor valid as a statute. It can be cancelled or withdrawn or modified without need for “publication”.

xii.

Given this situation, it logically follows that S.196 was notified on 01/04/201614 and hence the limitation period of the suit itself begins only on 01/04/2016. Art.58 of the Schedule, in the Limitation Act, 1963, lays down that 3 years is the prescribed period within which declaratory suits can be filed. The suit was instituted on 12th May, 2016, before the lapse of 3 years and hence, is not barred by limitation.

2. Whether the age limit of 70 years under S. 196(3) (a) of the Companies Act, 2013 can apply to a WTD validly appointed prior to 01. 04. 2013? S.196 (3) (a) can apply to a Whole Time Director validly appointed prior to 01.04.2013.

A. Concept of Retrospectivity & S.196(3)(a) i.

Retrospectivity means looking backward ; contemplating what is past ; having reference to a statute or things existing before the Act in question . Retrospective law means a law which looks backward or contemplates the pasts ; one which is made to affect acts or facts occurring , or rights occurring , before it came into force.15An otherwise prospective statute would not become retrospective merely because in its operation it includes all

12

Section 1(3) of the Companies Act, 2013. Rajendra Agricultural University v. Ashok Kumar Prasad &Ors., (2010) 1 SCC 730. 14 www.mca.gov.in/Ministry/pdf/ProvisionsTable_CompAct.pdf. 15 Darshan Singh v. Ram Pal Singh, 1992 Supp(1)SCC 191. 13


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 existing stock , whether manufactured , before or after the order. It is not a question of retrospectivity of the statute but its actual working.16 ii.

The claim of vested rights being affected due to the application of S. 196 retrospectively even to appointments made under the 1956 Act cannot be entertained because, the rule against retrospective construction is not applicable to a statute merely because a part of the requisites for its action is drawn from a time antecedent to its passing.17

iii.

A rule amended prospectively would not be considered to have an element of retrospectivity merely because it is applicable also to those whom the pre-amended rule was applicable.18 S.196(3)(a) is a prospective and not a retrospectiveprovision. The change brought in by this provision does not say that it will be with effect from any earlier date , before 1st April 2013. It cannot be held as retrospective merely because it would be applied to Mr.McLinden who was appointed in 12th February, 2013.

iv.

It is not possible or probable for the Legislature to give a guarantee that until the completion of his tenure , the laws governing his position as a Whole Time Director would remain the same . That is a matter of legislative policy ; and hence the very claim of the appellants that the provision operates retrospectively to affect vested rights is not tenable.Arguendo , there is no prohibition against retrospective legislation. The power of the Legislature to pass a law postulates the power to pass it prospectively as well as retrospectively.19

v.

Regarding retrospectivity of statutes, it is not only that the declaratory or clarifactory statute can be given retrospective effect, retrospective effect can be given to a prospective statute in case there are no words in it to compel the courts to hold that it cannot operate retrospectively.20 There are no explicit words in the Companies Act, 2013 that the Act does not apply to companies incorporated before passing of the 2013 Act and this clearly admits of giving it a valid retrospective operation.

vi.

The Act of 2013 is clearly an amending and consolidating Act21 and an Amending Act is retrospective if there is a clear indication in the legislative language to that effect.22

16

Bashiruddin Ashraf v. Bihar Subai Sunni Majlis-A waqf, AIR 1965 SC 1206. Dilip v. Mohd. Azizul Haq, AIR 2000 SC 1976. 18 Punjab University v. SubhashChander, (1984)3 SCC 603. 19 Utkal C&J (P) Ltd. v. State of Orissa, AIR 1987 SC 2310. 20 Bharat Singh v. Management of New Delhi Tuberculosis Centre, AIR 1986 SC 842. 21 The Companies Act, 2013, Statement of Objects & Reasons. 17


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 Though the whole Act is not retrospective, a statute may be prospective in some parts and retrospective in other parts.23 Here, Section 196 (3) says in the most strict and affirmative words that ‘no company shall appoint or continue the employment of…’, firmly where negative language is worded to emphasize the insistence of compliance with the provision of the Act,24 and thus, S. 196 does have retrospective operation. vii.

If the meaning of the words used indicates an intention that the Act is to have retrospective operation, then, no matter what the consequences, this operation must be given to the provisions.25

viii.

Also, the disqualifications which have been mentioned in Section 196(3) are introduced as a matter of public policy26 and they contain a mandatory prohibition/bar for continuing the WTD in employment once he has attained the age of 70 years. Public interest at large is one of the relevant considerations in determining the constitutional validity of a retrospective legislation.27

ix.

Though it is often said that:- ‘A retrospective or retroactive law is which takes away or impairs vested or accrued rights acquired under existing laws’28, it cannot be said that vested rights cannot be taken away by Legislature by way of retrospective legislation29 .

x.

The claim of vested rights being affected due to the application of S. 196 retrospectively even to appointments made under the 1956 Act cannot be entertained because, the rule against retrospective construction is not applicable to a statute merely because a part of the requisites for its action is drawn from a time antecedent to its passing.30

xi.

The Supreme Court in State of TN v. Aroorran Sugars Ltd., has held that whenever any amendment is brought in force retrospectively or any provision of an Act is deleted retrospectively, in this process rights of some are bound to be affected in one way or the other. In every case, it cannot be urged that the exercise by the Legislature while introducing a new provision or deleting an existing provision with retrospective effect per

22

ShyamSundar v. Raj Kumar, [2001] 8 SCC 24. Shah Bojraj Mills v. Subash Chandra, AIR 1961 SC 1596. 24 State of Bihar v. Maharajadhiraj Sri Kameshwar Singh, AIR 1952 SC 252. 25 Rashid Bibi v. Tuftail Muhammad, AIR 1941 (Lah) 291-92. 26 Sridhar Sundararajan v. Ultramarine & Pigments Ltd., Feb 8, 2016, APPL/632/2015. 27 Virendra Singh Hooda v. State of Haryana, AIR 2005 SC 137. 28 ‘Words & Phrases’, Document Ed., Vol. 37-A, pp. 224/225, referred in Virendra Singh Hooda v. State of Haryana, AIR 2005 SC 137 at p.147. 29 Virendra Singh Hooda v. State of Haryana, AIR 2005 SC 137 at p. 152. 30 Dilip v. Mohd. Azizul Haq, AIR 2000 SC 1976. 23


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 se shall be violative of Art. 14 of the Constitution. If that was to be accepted, then the necessary corollary shall be that the Legislature had no power to legislate retrospectively because in that event a vested right was affected.31 xii.

Therefore, the age limit of 70 years under Section 196(3)(a) of the Companies Act, 2013 applies even to a Whole Time Director validly appointed prior to 01.04.2013 .

B. No role of Sympathy xiii.

In Maruti Udyog Ltd. v. Ram Lal32, it was held that while construing a statute , ‘sympathy’ has no role to play. The Court should never exercise its jurisdiction under Art.142 of the Constitution of Islandia , on misplaced sympathy33. The latin maxim “dura lex sed lex” which means ‘law is hard , but it is the law’ would operate here ; hence the contention of the appellants that an interpretation that would result in mid term cessation of the 70 year old WTD would be harsh or unfair is unwarranted and cannot hold good.

3. Whether the word ‘continue’ used in S. 196(3) ought to be construed in context of 196(3) (b), (c), (d) alone and not to 196(3) (a)? It is humbly submitted that the word “continue” used in S. 196(3) ought to be construed in the context of S.196 (3)(a),(b),(c) and (d) by: A. Applying the rule of Literal/Grammatical Interpretation; B. Disregarding Purposive Interpretation. A. Literal rule of interpretation •

Concept of Literal Rule

i.

Literal Rule of Interpretation means that “where the words of a statute are absolutely clear and unambiguous, recourse cannot be resorted to the principles of interpretation,

31

State of TN v. Aroorran Sugars Ltd., AIR 1997 SC 1815. Maruti Udyog Ltd. v. Ram Lal,AIR 2005 SC 851. 33 A.Umarani v. Registrar Co-op. Societies, AIR 2004 SC 4504. 32


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 other than the literal rule.”34 The statute should be interpreted on the face of the language or itself without adding, subtracting or omitting words therefrom.35 Thereby by construing S.196(3) literally it is evident that the word “continue” is to be read in the context of all the clauses of sub-section (3) of S.196 and not S.196(3)(a) alone.

• ii.

Application of the Literal Rule “If the precise words used are plain and unambiguous, in our judgment we are bound to construe them in their ordinary sense, even though it does lead to an

absurdity or

manifest injustice”36. This has been reiterated by the Supreme Court in the landmark judgement of Gurudevdatta VKSSS Maryadit v. State of Maharastra37, it was opined by the majority that, it is a cardinal principle of interpretation of statute that the words of a statute must be understood in their natural, ordinary and popular sense and construed according to their grammatical meaning unless such construction leads to some absurdity or there is something in the object of the statute to suggest to the contrary.S. 196 of the Companies Act, 2013 has no scope for ambiguity as it can be clearly understood from a plain reading of the section that the word “continue” applies to the entire sub-section as a whole. iii.

Unless the words are without meaning or absurd, it would be safe to give words their natural meaning because the framer is presumed to use the language which conveys the intention38 and it would not be in accordance with any sound principle of construction to refuse to give effect to the provisions of a statute, on the very elusive ground that to give them their ordinary meaning leads to consequences which are not in accordance with the notions of the propriety or justice entertained by the Court.39 If the framers intended that the word ‘continue’ must be used only in the context of clauses (b), (c) and (d), they would have provided for clause (a) without the word ‘continue’ independently first, and

34

Swedesh Match AB v. Securities Exchange Board of India, AIR 2004 SC 4219. S.P. Gupta v. President of India, AIR 1982 SC 149. 36 Abley v. Dale (1851) 11 C.B. 378 at p. 391. 37 Gurudevdatta VKSSS Maryadit v. State of Maharastra, AIR 2001 SC 1980. 38 Glaxo Laboratories (I) Ltd. v. Presiding Officer, AIR 1989 SC 505. 39 State of Rajasthan v. Mrs. Leela Jain, AIR 1965 SC 1296. 35


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 then for the remaining clauses with the common starting words as is provided in S. 196(3) now. iv.

It has to be borne in mind that the Parliament never intends to enact an ambiguous law. Absurdity or anomalous results could not have intended by the Legislature.40 Thus, when the words of the provision are prima facie clear on the aspect that even continuance in office of the WTD must be subject to it, a different interpretation cannot be given to the provision by trying to create a fictional ambiguity. In construing the Act, we must adhere closely to the language of the Act. If there is ambiguity in the terms of a provision, recourse must naturally be had to well established principles of construction but it is not permissible first to create an artificial ambiguity and then try to resort to some general principle.41

v.

Grammatical construction has been accepted as the Golden Rule.42 And, Golden Rule is that words of a statute must prima facie be given their ordinary meaning43. Meaning and intention of a statute must be collected from the plain and unambiguous expression used therein rather than from any notions which may be entertained by the courts as what is just and expedient.44

vi.

Moreover, the language employed in a statute is the determinative factor of the legislative intent45 and, here, the legislative intent in introducing section 196(3)(a) along with clauses (b), (c) and (d) is quite clear. Obviously, the intention was to change the earlier position by providing that the person who has been appointed as Managing Director before he was 70 years old is prohibited from continuing as Managing Director once he has attained the age of 70.46

vii.

The consequences of a Legislative enactment might mean several things but that does not mean the interpretor can choose the construction that will best suit him. It is yet another rule of construction that when the words of the statute are clear, plain and unambiguous, then the courts are bound to give effect to that meaning, irrespective of the

40

Lalit Mohan Pandey v. Pooran Singh, AIR 2004 SC 2303. CIT v. Indian Bank Ltd., [1965] 56 ITR 77 (SC) at pp. 79 & 80. 42 Raghunandan Saran Ashok Saran v. PeareyLal, AIR 1986 SC 1682. 43 Gurudevdatta VKSSS Maryadit v. State of Maharastra, AIR 2001 SC 1980. 44 CIT v. ShahzadaNand& Sons, [1966] ITR 392 (SC). 45 Shiv Shakthi Co-operative Housing Society v. Swaraj Developers, AIR 2003 SC 2434. 46 Sridhar Sundararajan v. Ultramarine & Pigments Ltd., Feb 8, 2016, APPL/632/2015. 41


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 consequences47 and hence, by adopting the literal rule, the word ‘continue’ applies to all the clauses under S. 196(3). B. Purposive Construction not applicable viii.

A statute is an edict of Legislature48. It is said that the words themselves best declare the intention of the law giver.49 When the legislators have decided to place clause (a) which talks about age as a barrier along with the other clauses, they obviously had sufficient intention and reason to do so. This can be averred from the presumption that the Legislature never intends to enact ambiguity50. Hence, when it is the legislative will that is produced in S. 196(3), the Court cannot relegislate on the subject under the guise of interpretation against the legislative will expressed in the enactment itself.51

ix.

‘Purposive construction’ is certainly a cardinal principle of interpretation. Equally true is that no rule of interpretation should either be over-stated or over-extended.52 If the word ‘continue’ is interpreted to not apply to the particular clause (a), it will allow room for the persons who are disqualified under clauses (b), (c) and (d) as well to claim that the word ‘continue’ does not apply to those clauses. This is likely to cause a lot of unnecessary confusion in the operation of the Act . That construction is to be rejected which will introduce uncertainty, friction or confusion into the working of the system.53

x.

Furthermore, the Courts, when rule of purposive construction is gaining momentum, should be very reluctant to hold that the Parliament has achieved nothing by the language it used when it is tolerably plain what it seeks to achieve54.

xi.

It is an elementary duty of a court to give effect to the intention of the Legislature as expressed in the words used by it as no outside consideration can be called in aid to find

47

Gurudevdatta VKSSS Maryadit v. State of Maharastra, AIR 2001 SC 1980. Shiv Shakthi Co-operative Housing Society v. Swaraj Developers, AIR 2003 SC 2434. 49 Gurudevdatta VKSSS Maryadit v. State of Maharastra, AIR 2001 SC 1980. 50 Lalit Mohan Pandey v. Pooran Singh, AIR 2004 SC 2303. 51 JiniaKeotin v. Kumar SitaramManjhi, (2003) 1 SCC 730. 52 The Executive Engineer v. M/S Sri Seetaram Ricemill, (2012) 2 SCC 108. 53 G.P. Singh, Principles of Statutory Interpretation113 (7th ed., 1999), referred in Central Bank of India v. Ravindra, AIR 2001 SC 3095 at p.3114. 54 BBC Enterprises v. Hi-Tech Xtravision Ltd., (1990) 2 All ER 118 referred in New Piece Goods Bazaar Co. Ltd. v. CIT, [1988] 173 ITR 216 (Guj.). 48


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 that intention.55 In each case, the Act of Parliament is all powerful, and when its meaning is unequivocally expressed, the necessity for rules of construction disappears and reaches the vanishing point.56 Since S.196(3) has been framed in unequivocal terms so as to avoid any sort of ambiguity in regard to the word “continue” it ought to be applied to the entire sub-section. xii.

The Companies Act has been a dynamic Statute that has been through various amendments and adaptations. Purposive construction need not be applied where relevant Act has been amended from time to time on the basis of the fresh needs and has, thus, not remained static. Literal interpretation has to be resorted to.57

xiii.

Though often purposive construction involves considering the previous state of the Act before it was amended, as J.Bhagwati has rightly said in National Textile Worker’s Union v. P.R. Ramakrishnan58, ‘We cannot allow the dead hand of the past to stifle the growth of the living present. Law cannot stand still; it must change with the changing social concepts and values.’ Therefore, inviolable importance must be given to the new and amended 2013 Act, without clinging onto the provisions of the 1956 Act.

xiv.

When Legislature uses an expression, that has to be given effect to, and cannot be rendered nugatory by giving undue importance to the object of the Act and of the specific provision in question.59 The spirit of the law may be an elusive and unsafe guide and the supposed spirit can certainly be not given effect to in opposition to the plain language of the sections of the Act.60 Thus, by a plain reading of S.196(3) it is clear that the word ‘continue’ not only applies to clauses (b), (c) and (d), but also to clause (a).

55

New Piece Goods Bazaar Co. Ltd. v. CIT, [1988] 173 ITR 216 (Guj.). Bowen L.J in London & North West Railway v. Evans [1893] 1 Ch. 186, 27. 57 Dental Council of India v. HariPrakash, [2001] 8 SCC 61. 58 National Textile Workers’ Union v. P.R. Ramakrishnan, [1983] 1 SCC 228. 59 Bharathidasan University v.All India Council for Technical Education, [2001] 8 SCC 676. 60 Rananjaya Singh v. Baijnath Singh, AIR 1954 SC 749. 56


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 4. Whether S.196(3)(a) of the 2013 Act operates as an immediate disqualification on the appointment and continuation of a person as WTD or whether it is an eligibility condition which only applies at the time of appointment and whether there is any distinction between the two? It is humbly submitted that S. 196(3)(a) of the Companies Act of 2013 operates as an immediate disqualification on the appointment and continuation of a person as Whole-Time Director because: A. It is a disqualification and not a mere eligibility condition; B. Experience nor sympathy can have bearing on the operation of the Act; C. Operation of the Proviso. A. A disqualification and not a merely an eligibility condition i.

At the very outset the word ‘eligibility’ is nothing but involves a factor of suitability61. Thereby, clause (a) of sub-section (3) to S.196 which talks about the age limit is nothing but acts as a yardstick to measure the suitability of a person to a key managerial role of that of a WTD. The word ‘disqualification’ connotes the absence of competence that is regarded as an obstacle in carrying on a profession62. A person attaining the age of 70 may lack the necessary level of competence to that of a young lad who would be hale and healthy. Also, running the risk of health and other physical problems one may not be able to contribute his fullest potential if retained in a key managerial post. However, in exceptional cases by the passing of a special resolution such a person can be appointed or re-appointed as a KMP.

ii.

Also, it is pertinent to note that S. 196(3) would operate as a disqualification on the appointment and as an immediate disqualification on the continuation of a person as Whole-Time Director because it has been mentioned in unequivocal terms in the section itself as regarding the appointment as well as the continuation of a person in the employment of the company.

61

Mahesh Chandra Gupta v. Union of India, (2009)8 SCC 273. Government of Pakistan v. AkhlaqueHussain, PLD 1965 SC 527.

62


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 iii.

Arguendo, eligibility can be changed for various purposes and the person concerned cannot raise the grievance that he should be governed only by the rules existing when he joined service63 because all criteria cannot be postulated in the beginning itself.64 A rule amended, if prospective in operation, would not become retrospective merely because it also governed those who joined the course when the old rule prevailed.65

iv.

Thereby, Mr. James McLinden cannot claim before this court that since he had been validly appointed as per the requirements of the Companies Act, 195666 he ought to be governed by those provisions only. He will be subject to the provisions of the Companies Act, 2103 and it is a well-settled principle that no appointment can be made by way of granting relaxation of eligibility or in contravention thereof.67 By invoking this principle it is evident that no relaxation as to age can be given to Mr. James McLinden. He ought to step down from office and has to be re-appointed by virtue of a special resolution. B. Experience nor sympathy can have a bearing on mid-tenure cessation

xv.

It is crystal clear terms that a person who has attained the age of 70 years would be immediately terminated from the post. However, he could continue in office by the passing of a special resolution as provided in the proviso under S.196(3)(a). It is pertinent to note that the appointment made in contravention of the statutory requirement i.e. eligibility, cannot be approved and once an appointment is bad at its inception, the same cannot be preserved, or protected, merely because a person has been employed for a long time.68

xvi.

It is also clear that the experience of Mr. James McLinden cannot be taken as a defence in order to preserve his continuation in office and even if the special resolution is being passed it cannot save him from stepping down from office by virtue of the judgement delivered by the Supreme Court in Pramod Kumar v. U.P.Secondary Education Services Commission69 that lacking eligibility cannot be cured at any stage and appointing such

63

Praveen Singh v. State of Punjab, (2000) 8 SCC 436; State of J&K v. Shiv Ram Sharma (1999)3 SCC 653. Tata Cellular v. Union of India, (1994) 6 SCC 65. 65 Punjab University v. Devjani Chakrabarti, (1984) 3 SCC 612. 66 ¶ 2of the Moot Proposition. 67 State of M.P v. DharamBir, (1998) 6 SCC 165. 68 State of Orissa v. MamataMohanty, (2011) 3 SCC 436. 69 Pramod Kumar v. U.P.Secondary Education Services Commission, (2008) 7 SCC 153; 64


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 person would amount to serious illegality and not a mere irregularity. His appointment cannot be sustained on humanitarian grounds. However, his experience can be taken into consideration for his re-appointment to the same post70 by passing a special resolution.In a case where a statute is found to be obscure, it is the well-settled principle of law that the same must be interpreted having regard to the Constitutional scheme.71 xvii.

Thereby, as was held in Secretary of State of Karnataka v. Umadevi, it was held that appointments made in violation of rules would be violative of Art.14, rendering the same a nullity as such even if the appointee had continued in service for a long period. Thereby, Mr. James McLinden continuing in office without the passing of a special resolution would amount to violation of Art.14 as it would be prejudice to the others who are above the age of 70 who would be subsequently appointed or those who possibly could have been appointed. C. Operation of Proviso

xviii.

A proviso or an exception cannot be so interpreted as to nullify or destroy the main provision.72 The main provision itself provides that no person can be employed or continued in employment and no exception can be drawn to the proviso as it will nullify the main provision otherwise. Negative language is worded to emphasize the insistence of compliance with the provision of the Act73 and is thus a mandatory provision.

xix.

The proviso to the section is also a mandatory one and a special resolution has to be passed in order to appoint a person who is above 70 years of age. The true point of a distinction between a provision which is mandatory and one which is directory is that while the former must be strictly observed, in the case of the latter it is sufficient that it is substantially complied with in the subject matter.74Thus, there must be strict compliance with the provision.

Prit Singh v. S.K.Mangal, 1993 Supp (1) SCC 714. 70 Ashwani Kumar v. State of Bihar, 1995 SCALE (6) 779. 71 State of Himachal Pradesh v. Surinder Singh Banolta, 2006 (2) ShimLC 237. 72 T. Devadasan v. Union of India, AIR 1964 SC 179 at p. 187. 73 State of Bihar v. Maharajadhiraj Sri Kameshwar Singh, AIR 1952 SC 252. 74 Hari Vishnu Kamath v. Ahmad Ishaque, AIR 1955 SC 233.


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 xx.

In the case of Ramji Missar v. State of Bihar,75it was held that,“In enacting that they ‘may’ or ‘shall’, ‘if they think fit’or ‘shall have power’ or ‘that it shall be lawful’ for them to do such act, a Statute appears to use the language of mere permission, but it has been so often as to have become an axiom that in such cases, such expressions may have to say the least a compulsive force.”

xxi.

Moreover, when a statute says that a certain thing shall be done in a certain way, it should be done that way and no other76. On the other hand, it is not always correct to say that where the word ‘may’ has been used, the statute is only permissive or directory in the sense that non compliance with those provisions will not render the proceedings invalid.77

xxii.

Therefore, a person above 70 years of age can hold office only after passing a special resolution and by no other means and Section 196(3)(a) of the Companies Act of 2013 operates as an immediate disqualification on the appointment and continuation of a person as Whole-Time Director.

75

Ramji Missar v. State of Bihar, AIR 1963 SC 1088 at pp. 1092-1093. Babu Verghese & Ors vs Bar Council Of Kerala P.Rajangam, (1999)3 SCC 422; Sub Inspector of Police v. State of Madras, AIR 1959 Mad. 294. 77 State of Uttar Pradesh v. ManbodhanLal, AIR 1957 SC 912; Craford on Statutory Construction, Art. 267,p. 516. 76


THE 4TH KIIT UNIVERSITY NATIONAL MOOT COURT COMPETITION, 2016 PRAYER

For the reasons aforesaid and taking into account the arguments advanced, this Hon’ble Court may be pleased to confirm the order passed by the Division Bench of the High Court of Winchester, upholding the order of injunction passed by the Learned Single Judge of the said High Court, dismiss the appeal and thus render Justice. Sd/(Counsel for Respondent)


KIIT Respondent

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