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Madras Bar Association v. Union of India & Ors.

Corporate Laws — Companies Act 1956 — Pts. I-B and I-C [as inserted by Companies Second Amendment Act of 2002] — Constitutional validity of, was examined by a Constitution Bench in R. Gandhi, 2010 (11) SCC 1 — — Parliament has subsequent to the above judgment enacted the Companies Act, 2013 by which Companies Act, 1956 has been repealed — — Besides Ch. XXVII of the new Act envisages establishment of National Company Law Tribunal and National Company Law Appellate Tribunal sought in the manner and on the terms set out in the said chapter — Constitutional validity of Ch. XXVII comprising Ss. 407 to 434 have been assailed by the petitioner-association in WP (C) No. 1072 of 2013 as amended — In conencted WP (C) No. 267 of 2012, petitioner prayed for a mandamus directing implementaion of the directions issued by the Constitution Bench in R. Gandhi’s case — Held, substantial questions of law involving interpretation of the provisions of the constitution falls for determination — Moreover, since an analogous challenge in the earlier round of litigation had been examined by a Constitution Bench of Apex Court, writ petitions referred to a larger Bench for an authoratative pronouncement on the questions that have been raised — Constitution of India, Art. 32                                                                      (Paras 2 and 3)

(T.S. Thakur, Rohinton Fali Nariman and Prafulla C. Pant, JJ.)

 

Madras Bar Association _________ Petitioner

 

v.

 

Union of India & Ors. ___________ Respondent(s)

 

Writ Petition(s) (Civil) No(s). 267/2012, decided on February 18, 2015

SLP (C) No. 35248/2012, W.P.(C) No. 1072/2013, SLP (C) No. 7219/2014

 

The Order of the court was delivered by

Order

 

1. Constitutional validity of Parts I-B and I-C of The Companies Act 1956 inserted by Companies Second Amendment Act of 2002 was examined by a Constitution Bench in Union of India v. R. Gandhi, President, Madras Bar Association 2010 (11) SCC 1 The operative part of the order passed in the said case was to the following effect:

 

“We, therefore dispose of these appeals, partly allowing them, as follows:

 

i) We uphold the decision of the High Court that the creation of the National Company Law Tribunal and the National Company Law Appellate Tribunal and vesting in them, the pwoers and jurisdiction exercised by the High Court in regard to company law matters, are not unconstitutional.

 

ii) We declare tht Parts I-B and I-C of the Act as presently structures, are unconstituional for the reasons stated in the preceding paragraph. However, Parts I-B and I-C of the Act, may be made operational by making suitable amendments, as indicated above, in addition to what the Union Government has alrady agreed to in pursuance of the impugned order of the High Court.”

 

2. The Parliament has subsequent to the above judgment enacted The Companies Act, 2013 by which Companies Act, 1956 has been repealed. Besides Chapter XXVII of the new Act envisages establishment of National Company Law Tribunal and National Company Law Appellate Tribunal sought in the manner and on the terms set out in the said chapter. Constitutional validity of Chapter XXVII comprising Sections 407 to 434 have been assailed by the petitioner-association in Writ Petition (C) No. 1072 of 2013 as ammended. In conencted Writ Petition (C) No. 267 of 2012 the petitioner has prayed for a mandamus directing implementaion of the directions issued by the Cosntitution Bench in R. Gandhi’s case supra.

 

3. Having heard Mr. Arvind P. Datar, learned senior counsel and Mr. Mukul Rohtagi, learend A.G. at some length we are of the view that substantial questions of law involving interpretation of the provisions of the constitution falls for determination. That apart since an analogous challenge in the earlier round of litigation had been examined by a Constitution Bench of this Court, we see no reason why the present writ petitions should also not be referred to a larger Bench for an authoratative pronouncement on the questions that have been raised. We accordingly refer these writ petitions to be placed before a Constitution Bench for final hearing and disposal. Additional paper books shall be filed by the petitioners within two weeks. The papers shall be placed before Hon’ble the Chief Justice of India for constituting a larger Bench.

 

SLP(C) Nos. 7219 of 2014 and 35248 of 2012:

 

4. De-tagged. To be listed separately after four weeks.

 

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