Judgment:
IN THE HIGH COURT AT CALCUTTA Testamentary and Intestate Jurisdiction Original Side Present: The Hon’ble Justice Jyotirmay Bhattacharya G.A.508 of 2016 G.A654of 2016 G.A189of 2016 GA354of 2016 TS6of 2004 In the goods of : Priyamvada Devi Birla (deceased) And In the matter of : Harsh Vardhan Lodha & Ors. Vs. Ajay Kumar Newar & Ors. For the plaintiffs : : : : : : : : : : Mr. Anindya Kumar Mitra, Sr. Adv. Mr. Pratap Chatterjee, Sr. Adv. Mr. Malay Kumar Ghosh, Sr. Adv. Mr. Abhrajit Mitra, Sr. Adv. Mr. Jishnu Chowdhury, Adv. Mr. Debanjan Mandal, Adv. Mr. Sanjiv Kumar Trivedi, Adv. Mr. Soumya Ray Chowdhury, Adv. Mr. Sarvapriya Mukherjee, Adv. Mr. Satadeep Bhattacharya, Adv. For the Defendant Nos. 1(d) & 2. : : : : : : : : : Mr. P. Chidambaram, Sr. Adv. Mr. Bimal Kumar Chatterjee, Sr. Adv. Mr. Hirak Kumar Mitra, Sr. Adv. Mr. Sanjiv Sen, Adv. Mr. Swarnendu Ghosh, Adv. Mr. Debdutta Sen, Adv. Ms. Suchismita Ghosh, Adv. Mr. M.K. Seal, Adv. Mr. Shaunak Mitra, Adv. For the defendant Nos. 1b and 1c : Mr. Samaraditya Pal, Sr. Adv. : Mr. S.P. Sarkar, Sr. Adv. : Ms. Vineeta Meharia, Adv. : Mr. D.N. Sharma, Adv. : Mr. N. G. Khaitan, Adv. : Mr. Pratik Mukhopadhyay, Adv. For one of the executor : Mr. K. N. Mukherjee, Adv. Heard on :
07. 04.16, 12.04.16, 15.04.16, 18.04.16, 19.04.16,20.04.16, 29.04.2016 05.05.2016, 12.05.2016 & 13.05.16. Judgement On :
19. h May, 2016 Jyotirmay Bhattacharya, J.
This testamentary suit springs out of an application for grant of probate filed by the predecessor-in-interest of the present plaintiffs who, as executor and/or propounder applied for grant of probate of the Will published by one Priyamvada Devi Birla in short P.D.B on 18th April, 1999 along with the codicil dated 15th April, 2003 to the said Will. During the pendency of the probate proceeding the executor, namely, Rajendra Singh Lodha in short R.S.L died and after his death his legal heirs were substituted in the place of the said deceased executor and the said proceeding was converted into a proceeding for grant of letters of administration at the instance of the Present plaintiffs being the legatees under the said Will. In an appeal arising out of an order passed by the Probate Court, a three member committee of administrators pendente lite (hereinafter referred to as ‘APL’) was appointed over the estate of the late Priyamvada Devi Birla. Out of these three members of the APL, one was nominated by the Lodhas, namely, Mahendra Kumar Sharma another was appointed as a nominee of A.K. Newar and others, namely, Amal Chandra Chakraborty and apart from them a former Judge of the Hon’ble Supreme Court Mr. Justice R.V Raveendran was appointed by the Court as another member of the said committee of ‘APL’. However, due to resignation submitted by Justice R.V. Raveendran subsequently, the Committee of ‘APL’ became non-functional and, as a result, presently the estate is not being looked after by any independent officer of the Court. When in these set of facts, the defendants/applicants came to know from various newspapers reportings that Birla Corporation Limited in which Priyamvada Devi Birla had some share was negotiating with Reliance Infrastructure Limited for acquiring four of its cement manufacturing units by purchasing its shares in Uttar Pradesh, Madhya Pradesh, Maharashtra and West Bengal involving a huge investment of about 4,000-4200 crores, two applications were taken out by two sets of defendants under an apprehension that the debt burden of Birla Corporation Limited will increase by about Rs.3,100/- crores if the said deal is executed with Reliance Infrastructure. Identical apprehension of enhancement of debt burden amounting to Rs.1,500/- crores approximately of the company, namely, Birla Corporation Limited was also expressed by the defendants/applicants in case the said company executes the deal of taking over the two units of other cement manufacturing company Viz., Lafarge India. However, the proposal for taking over two units of Lafarge India was subsequently abandoned by B.C.L. It is alleged in the said application that since the estate of Priyamvada Devi Birla is the promoter of Birla Corporation Limited and its control vests with the estate of Priyamvada Devi Birla directly or indirectly through the interlinking, chain and cross-holding of shares, whenever any policy decision which has material impact on the fortunes of the company is required to be taken, the promoter group of the said company should be consulted even though under the provisions of the Companies Act formal control vests with the Board of Directors. It is further alleged therein that the fiduciary position held by the Director of the company also demands that before making such huge commitment, the Directors of the company should consult the promoters and the promoter group which includes the estate of Priyamvada Devi Birla which has large stakes in the success or failure of the said company. It was further alleged therein that even this Hon’ble Court while appointing a committee of ‘APL’ on 23rd August, 2012 made it clear irresistibly, expressly or impliedly that any major policy decision affecting the interest can be taken by this Hon’ble Court through the Committee of ‘APL’ as constituted by this Court. In this background two applications being G.A508of 2016 & GA189of 2016 were filed by two sets of defendants seeking leave of this Court to serve a copy of the said application on Birla Corporation Limited in order to bring the clear picture regarding such proposed transaction on record and for this purpose a mandatory injunction for issuance of direction upon Harsh Vardhan Lodha and/or Birla Corporation Limited to produce the due diligence report conducted, if any and all other relevant papers and documents referred to in pages 41 and 59 of this application prior to Birla Corporation Limited acquiring cement businesses of Reliance Infrastructure. Injunction is also sought for restraining the Harsh Vardhan Lodha from causing Birla Corporation Limited from acquiring some of the business of Reliance Infrastructure limited and two cement units of Lafarge India, so that status quo in respect of such proposed transaction is maintained until the Hon’ble Court arrives at a decision as to whether such acquisition is in the interest of the estate of Priyamvada Devi Birla or not. Injunction has also been sought for restraining Harsh Vardhan Lodha from causing Birla Corporation Limited any act or Birla Corporation Limited from acting in furtherance of postal ballot notice dated 23rd December, 2015 until this Court arrives at a decision as to whether such acquisition is in the interest of estate of Priyamvada Devi Birla or not. However, since B.C.L has abandoned its proposal to take over the said two units of Lafarge India, the applicants have given up their claim for production of the relevant documents relating to the said transaction with Lafarge India and the other incidental reliefs claimed in these applications relating to the said transaction with Lafarge India. Since both these applications were filed for identical reliefs on similar set of facts, both these applications were heard analogously and for avoiding conflict of decision, I propose to dispose of both these applications by this common judgment. The plaintiffs herein has taken out two applications in the form demurrer application challenging the of maintainability of the defendants’ said application and claimed their first right of hearing on their application relates to the maintainability of the application filed by as it the defendants. Maintainability of the defendants’ said applications were challenged by the plaintiffs in their demurrer applications on various grounds including the ground of factual aspects. Those applications were registered as GA654of 2016 and GA354of 2016 respectively. However, since at the very outset, Mr. Mitra, learned Senior Counsel appearing for the plaintiffs, made it clear that while demonstrating his objection regarding maintainability of those applications filed by the defendants, he will confine himself to the averments made by the defendants/applicants in their said applications and will support his conclusion by accepting the statements made in the application, as true and correct, this Court permitted Mr. Mitra to argue the maintainability point only on the basis of the averments made by the defendants in their said applications. Accordingly, Mr. Mitra developed his submission by restricting his argument purely on the point of law regarding maintainability of the defendants’ said application with reference to the averments made in the defendants’ said applications. He contended that the instant application filed by the defendants is not maintainable as it does not disclose any cause of action for filing such applications. By referring to various paragraphs of the said applications, Mr. Mitra pointed out that the entire reliefs claimed in the said applications are based on certain information collected by the applicants from various newspapers reporting which they claimed in their affidavits to be the information derived by them from records. Mr. Mitra referred to various judicial pronouncements of the Hon’ble Apex Court to support his contention that newspaper reportings per se are not admissible in evidence and, as such, the Court should not take note of such inadmissible evidence while considering the appellant’s said applications. In support of his submission that the newspaper reportings are not admissible in evidence as these are all hear say evidence, he has relied upon the following decisions of the Hon’ble Supreme Court:(i) In the case of Lakxmi Raj Shetty & Anr. Vs. State of Tamil Nadu reported in (1988)3 SCC319paragraphs 25,26 and 34. (ii) In the case of Ravinder Kumar Sharma Vs. State of Assam & Ors. reported in (1999)7 SCC435paragraph 26. Relying upon the aforesaid decisions of the Hon’ble Supreme Court, Mr. Mitra submitted that if the newspaper reportings are not taken into consideration as these are inadmissible in evidence, it will necessarily follow that the relief claimed in these applications have no foundation at all inasmuch as apart from these newspaper reportings, the applicants have not disclosed any other source of information based on which they expressed their apprehension that if the four units of Reliance Infrastructure Limited are acquired by Limited Birla Corporation then such acquisition of these cement manufacturing units by purchasing its shares, may affect the interest of the shareholders of the Birla Corporation Limited. He thus, contended that since the reliefs claimed in these applications are without any foundation, no relief can be granted to the applicants on the basis of such inadmissible evidence. He further contended that even assuming that the newspapers reporting cannot be ignored at this stage and the application cannot be dismissed at this stage for want of evidence still then according to Mr. Mitra, these applications are liable to be dismissed on the ground of its maintainability as the Court while dealing with the testamentary suit has no jurisdiction to grant the relief which are claimed by the applicants in these applications. According to him, the Probate Court while dealing with a testamentary suit only acts as a Court of conscience to find out as to whether the Will was the last Will of the testator or not and further as to whether the Will was duly executed by him and properly attested by the attesting witness or not and further as to whether at the time of execution, the testator was physically fit and mentally alert or not and further as to whether the testator consciously executed the Will or not and further as to whether there was any suspicious circumstances under which such Will was executed and if it is found by the Testamentary Court that the will is the last Will of the testator and the said will was duly executed by the testator and execution of the will by the testator was properly attested by the attesting witnesses and the testator was physically fit and mentally alert at the time of execution of the Will and there was no suspicions circumstance which might have influenced the testator to execute the Will then the testamentary Court will have to grant probate to the said Will. He further contended that while dealing with a testamentary suit, the Court has no jurisdiction to decide any dispute relating to the title of the testator in the property, bequeathed under the Will. Thus the business of the Testamentary Court is very restricted. The Probate court has no jurisdiction to decide any foreign issue. According to Mr. Mitra, the issue which is raised in this application is absolutely a foreign issue so far as the testamentary suit is concerned as grant of reliefs claimed in this application depends upon determination of various issues relating to the business management of a company registered under the Companies Act which authorizes the Company Law Board only to resolve such dispute. He elaborated his aforesaid submission by contending that under the Companies Act a company cannot be the asset of the estate belonging to deceased and the shareholders of a company has no interest in the asset of the company even though the shareholders have interest in the shares of the company. According to him shares which Priyamvada Devi Birla had in the said company formed part of her estate on her death and since she allegedly bequeathed her shares in favour of the executor R.S.L under the said Will, it is the duty of the testamentary Court to pass necessary order under Section 247 of the Indian Succession Act for safe preservation of the shares belonging to the estate of Priyamvada Devi Birla and also for proper exercise of the right of the shareholder as per the provisions of the Companies Act. Mr. Mitra submitted that the probate Court has already taken care of these shares and had already appointed “APL”. which has already got these shares registered in its name and these shares are well-managed by the “APL”.. According to him, since company is not the assets of the estates of Priyamvada Devi Birla, the testamentary court cannot pass any direction regarding management of the company and/or concerning any matter relating to its business policy. In support of his submissions that the company cannot be an asset of the estate of the deceased and the shareholders have no interest in the asset of the company, he has relied upon the following decisions of the Hon’ble Supreme Court:
1. In the case of Bacha F. Guzdar Vs. Commissioner of Income Tax, Bombay reported in AIR (1955) SC74paragraph 7.
2. In the case of Rustom Cavasjee Cooper Vs. Union of India reported in 1970 (1) SCC248paragraph 10 and 11. Relying upon the aforesaid decision, he submitted that if the assets of a company cannot be the asset of the shareholder, the shareholder cannot make any provision relating to the assets of the company in her Will. Thus, he submitted that since the assets of the company is not a part of the estate of the deceased, the Probate Court has no jurisdiction to pass any order regulating the business of the company, even if the Board of directors of a company takes any decision adverse to the interest of the shareholder or acts in violation of the provisions of the Companies Act. According to him, Section 179(3) of the said Act, vests jurisdiction upon the Board of Directors of the company to exercise various powers as enumerated under Clause (a) to (k) thereunder on behalf of the company. By referring to Section 179(3) (j) of the said Act, he submitted that jurisdiction to take over a company or acquire the controlling or substantial stake in another company is vested exclusively with the Board of Director of the company and the company Act has not vested any jurisdiction upon the shareholders of the said company to interfere with the decisions of the Board of Directors in this regard. He thus, contended that if the shareholders of the company has no say in the matter of taking any decision by the Board of Directors of a company in taking over another company or acquiring or controlling the substantial stake in another company then this court sitting in this jurisdiction, also cannot interfere with the jurisdiction of the Board of Directors of the company in taking over another company or in acquiring and controlling the substantial stake in another company. He, also contended that the powers of the Board of directors is not uncontrolled as the companies Act has imposed certain restriction on exercise of the power by the Board of Directors in Section 180 of the companies Act. But since the applicants do not complain of violation of any of the provisions contained in Section 180 of the Companies Act relating to the management of the assets of the said company by the Board of directors, no action as contemplated under the said provision against the Board of Directors can be taken in the instant case. Mr. Mitra however, submitted that even if the Board of Directors violates any of the provision of Section 180 of the said Act in the process of management of the assets of the company still then this Court sitting in this jurisdiction has no jurisdiction to grant any relief to a party as jurisdiction to grant any relief to a deserving party is given to the authority prescribed under the Companies Act i.e., the Company Law Board. Mr. Mitra, however, submits that if the shareholders have any grievance against the Board of Directors of the Birla Corporation Limited, they may approach the appropriate authority i.e., company Law board seeking appropriate relief but they cannot approach the Probate Court seeking any reliefs concerning the decision of the Board of Directors for acquiring four cement manufacturing units of Reliance infrastructure limited. In support of his aforesaid contention he has relied upon the following decisions of this Hon’ble Court:1. In the case of Murarka Paint & Varnish Works (Private) Ltd. Vs. Mohanlal Murarka & Ors. reported in 65 CWN32at page 14.
2. In the case of Jagdish Prasad & Anr. Vs. Pt. Paras Ram & ors. reported in AIR1941Allahabad 360 at page 363 and 3. In the case of Suburban Bank Private Ltd. Trichur Vs. Thariath & Anr. reported in AIR1968Kerala 206 paragraph 5. He further contended that from their own showing it appears that the Priyamvada Devi Birla had nominal shares in the Birla Corporation Limited. As such, the estate of the said deceased also represents nominal shareholder. According to him, such a nominal shareholder cannot even initiate the process for removal of the Directors and if that be so then even if the “APL”. remained functional still then the APL could not have interfered with decision of Board of Directors of the company in taking over the other cement manufacturing company nor could the “APL”. initiate the process of removal of the Directors for not taking steps in conformity with the provisions of the Companies Act. He further contended that interim order is always granted in aid of the ultimate relief. If this age old established principle of law is followed then it goes without saying that no relief by way of interim measure as prayed by the defendant in this application can be granted to the applicant in this proceeding even if ultimately letter of administration is granted by this Court in favour of the plaintiffs. He also submitted that the interim relief which is claimed in this application mostly concerns with the internal management of the company which the Probate Court cannot regulate sitting in this jurisdiction. In support of his contention that the Probate Court cannot interfere with the internal management of the company, he has relied upon a decision of the Hon’ble Supreme Court in the case of Kanwarjit Singh Dhillon Vs. Hardyal Singh Dhillon & Ors. reported in (2007)11 SCC357paragraph 5. He also contended that it is well settled principle of law that Court has no jurisdiction to pass any order against any third party. submission by contending that in this probate proceeding Limited has no caveatable interest. He elaborated his Birla Corporation He argued that since Birla Corporation Limited has no caveatable interest in the suit, it cannot be impleaded as a party in this testamentary suit and if it cannot be impleaded as a party in the suit then no order can be passed by this Court affecting the interest of the Birla Corporation Limited and/or the management of its business affairs. In support of his submission that Court has no jurisdiction to pass any order against any third party, he has relied upon the following decisions of this Hon’ble Court:- 1. In the case of Kishorsinh Ratansinh Jadeja Vs. Maruti Corporation & Ors. reported in (2009)11 SCC229paragraph 37.
2. In the case of K.P.M Aboobucker Vs. K, Kunhamoo & Ors. reported in 1958 Madras Page 287.
3. In the case of Varghese Vs. Fast Line Builders and Developers Kerala Pvt. reported in 2013(2) Kerala Law Journal page 695 and 4. In the case of West Bengal Housing Board Vs. Pramila Sanfui & Ors. reported in 2016(1) SCC743 Relying upon the aforesaid decision of different High Courts as well as the Hon’ble Supreme Court, Mr. Mitra submitted before this Court that since this Court sitting in this jurisdiction has no jurisdiction to pass any order against Birla Corporation Limited concerning its internal management and/or functioning, the application taken out by the defendants claiming several reliefs concerning the internal management of the said company and/or its decision for taking over four cement manufacturing units of Reliance infrastructure by purchasing its shares should be rejected for want of jurisdiction of this Court to entertain such application in this jurisdiction. Mr. Mitra further contended that the instant application is also not maintainable for want of cause of action as the applications do not disclose any averment to the effect that in case the four cement manufacturing units of Reliance Infrastructure are acquired, the value of the shares of Birla Corporation Limited will go down affecting the interest of the defendants. According to Mr. Mitra, in the absence of such assertion in the application itself no Court can grant any relief to the defendant on the basis of their apprehension that in case the said four cement manufacturing units of the said company are taken over by Birla Corporation Limited, the shares of Birla Corporation Limited will go down affecting the interest of the defendants and thus, for protecting the interest of the defendants any interim protection is required to be given by the Court. By referring to the reliefs claimed by the defendant in this application Mr. Mitra contended that apprehending that the reliefs which are claimed by the defendants in this application cannot be granted against the Birla Corporation Limited, they have sought for certain directions against Harsh Vardhan Lodha one of the plaintiffs in the said suit, in addition to the reliefs claimed against the Birla Corporation Limited. Mr. Mitra submitted that Harsh Vardhan Lodha is the Chairman of the Board of Directors of the said company. He has dual capacity; one, as one of the plaintiffs i.e., as legatee under the Will and other is as Chairman of the Board of Directors of the said company. By referring to the application, Mr. Mitra contended that no allegation has been made by the applicants against Harsh Vardhan Lodha in his capacity either as plaintiff or as legatee under the said Will. As such no direction can be issued upon Harsh Vardhan Lodha either in his individual capacity or in the capacity as a legatee under the Will in this proceedings Mr. Mitra further contended that since this Court sitting in this jurisdiction has no jurisdiction to pass any order interfering with the internal management of the said company, this Court is incompetent to pass any direction upon any of the Directors of the said company including Harsh Vardhan Lodha, the Chairman of the Board of Directors, concerning any decision taken and/or to be taken by the Board Directors of the said company. Mr. Mitra further contended that since the testatrix had nominal shares in Birla Corporation Limited; the “APL”. represents the minority share holder in the said company. He further contended that even assuming that the entire shares of the company or the majority shares of the company was held by the testatrix, still then the testatrix could not claim interest in the assets of the company as the company has its distinct identity in the eye of law and the assets owned by it are the assets of the company and not of the shareholders. To support his submission that the position of ownership of the assets of the company would not have been changed even if the testatrix was found to have been the owner of the entire shares of the company, he cited a decision of the Hon’ble Supreme Court in the case of Western Coalfileds Limited Vs. Special Area Development Authority Korba & Anr. reported in (1982) 1 SCC125wherein it was held that even the land and building vested in and owned by a Government company, are not exempt from payment of property tax to the Municipality, as a Government Company registered under the companies Act is a legal person, separate and distinct from its individual share-holder. It was further held therein that the property of the company is not the property of the shareholders. It was also held therein that a shareholder has merely an interest in the company arising under its Articles of Association, measured by a sum of money for the purpose of liability and by a share in the distributed profit. He thus, contended that since the shareholders have no interest in the assets of the company, neither the shareholder, nor the “APL”. can participate in the decision making process relating to the management of this assets of the company by the Board of Directors. Mr. Mitra further contended that the reliefs which the applicants have claimed in this application cannot be granted by the probate Court because of its limited jurisdiction conferred on it by the Indian Succession Act. He argued that even the company Court could not have entertained this application as it was held by the Hon’ble Kerala High Court in the case of Cochin Malabar Estate and industries Ltd. & Anr. Vs. P.V. Abdul Khader & Anr. reported in 114 company cases 777 that the company Court would not as a general rule interfere with internal management of a company as the Court determines the question of law and not the question of business management which is the job of the Board of Directors. It was further held therein that if the shareholder could procure the aid of the Court in each and every action of the Board of Directors, it would lead to endless litigations and pin down the company within the four walls of the company Court. The High Court further held that the company Court should shut its doors to them and deny entry. Mr. Mitra further contended that the allegation made by the applicants that the directors of the said company are under the control of the Harsh Vardhan Lodha, the Chairman of the Board of Directors and in fact, all the decisions were taken by the said Harsh Vardhan Lodha, are baseless as it appears from the documents annexed to the said application that out of nine Directors six are independent Directors who were selected in the Annual General Meeting held on 21st August 2014 in terms of the provision contained in Section 150 of the companies Act, 2003. He pointed out that when these independent Directors were selected in the Annual General Meeting held on 21st August 2014, the APL was very much functional. The APL became non-functional with effect from 17th December, 2014 when the resignation of the Justice Ravindran was accepted. He thus, argued that since APL did not object to the selection of these independent Directors, it can safely be presumed that they were selected in due observance of the provisions of the Companies Act and the APL had no grievance against the selection of the Directors and/or in their functioning at least till the date when it became non-functional. By referring to the profile of these independent Directors, he submitted that all of them are very responsible person, well-settled in their respective filed of work and they also satisfied the conditions for being selected as independent Director in terms of the provision contained in Section 2(47) of the said Act read with Section 149(5) of the said Act. He thus, submitted that the company is well-managed by the Board Directors and the Board of directors is capable of of taking decisions for the management of the said company and in fact, there is no allegation that the Board of Directors is not doing so. The apprehension of mismanagement of the business of the said company is baseless and without any foundation. According to him, even if such apprehension is genuine still then this is not the appropriate forum for ventilating the applicant’s grievances. Mr. Mitra also referred to the affidavit of assets to show that even the said company was not shown as the assets of the estate of the deceased. He thus, contended that even if the APL was functional, the APL could not have interfered with and/or objected to the decision of the Board of Directors in the management of its business. As per Section 179(3) of the Companies Act, the Board of Directors is competent to take the decision regarding acquiring of the other company for expanding its business. Such being the position, this Probate Court has also no jurisdiction to entertain such application. He ultimately concluded his submission by referring to the decision of the Hon’ble Supreme Court in the case of Official Trustee, West Bengal Vs. Sachindra reported AIR1969SC823wherein the Hon’ble Supreme Court while discussing the issue relating to the jurisdiction of the Court to decide an issue approved the full Bench decision of this Court in Hirday Nath Roy Vs. Ramchandra Barua Sharma reported in ILR48CAL138 The Full Bench of this Hon’ble Court dealt with the question as to what is meant by jurisdiction?. It was held therein that before a court can be held to have jurisdiction to decide a particular matter it must not only have jurisdiction to try the suit brought but must also have the authority to pass the order sought for. It was also held therein that it is not sufficient that it has some jurisdiction in relation to subject matter of the suit. The Full Bench further held that in order to hold that the Court has jurisdiction to decide an issue, its jurisdiction must include the power to hear and decide the questions at issue. The authority to hear and decide the particular controversy that has arisen between the parties or in other words what is relevant is whether the Court had the power to grant the relief asked for in the application filed by the applicant. If it is held that the learned judge had competence to pronounce a judgment on an issue presented before him for his decision then the fact that he decided that issue illegally or incorrectly is wholly besides the point. Relying upon the said decision of the Full Bench of this Court which was approved by the Hon’ble Supreme Court, Mr. Mitra submitted that if the test on jurisdictional issue is applied in the present case then it goes without saying that the testamentary Court having no jurisdiction to decide an issue relating the internal management of the company which is not an asset belonging to the estate of the testatrix, has no jurisdiction to entertain this present application as this Court has no authority to grant the relief which is sought for in this application. Mr. Mitra thus, invited this Court not to entertain this application for want of jurisdiction of this Court to grant the reliefs prayed for herein with this rider that in the event it is held that the Court has jurisdiction to entertain their application, then he will make submission on the merit of this application with reference to the application filed by his clients in the nature of demurer application. Mr. Pratap Chatterjee, learned Senior Counsel, who is assisting his leader, Mr. Mitra, also made some additional submissions in support of the demurrer application to impress upon this Court that the instant application is not maintainable in law. He submitted that shares held by the testatrix, no doubt, formed part of her estate after her death and such shares are heritable either by testamentary succession or by intestate succession. But the control over the management of the Birla Group of Companies which the testatrix used to exercise over the management of the Birla Group of Companies during her lifetime cannot be treated as a part of the estate of the testatrix inasmuch as controlling power over M.P Biral Group of Companies is incapable of passing to her successor either by way of testamentary or by non-testamentary succession, after the death of the testatrix. He contended that though this Hon’ble Court at various stages of the earlier interlocutory proceedings held that control over the management of the M.P Birla Group of Companies is a part of the estate of the testatrix, but such findings which were arrived at either by the learned Single Judge or by the Hon’ble Division Benches of this Court are all tentative findings arrived at interlocutory stages and as such the said findings arrived at either by the learned Single Judge of this Court or by the Hon’ble Division Benches of this Court are not binding upon this Court, as these findings are not conclusive findings arrived at by this Court at the final hearing. He further contended that the controlling power is allowed to be exercised by a Director only when the other Directors repose confidence in the said Director either for his strong personality or for his expertised knowledge and/or skill in management of the business of the company. Though, such controlling power is allowed to be exercised by a particular Director for having his strong personality and/or skill and/or ability to manage the business affairs of the company, such controlling power is not capable of passing to the successor by way of inheritance either by the testamentary succession or by intestate succession as the successor may not be found to be an able person like his predecessor who managed the business affairs of the company very efficiently and effectively. In short he contended that the controlling power of a Director cannot be a heritable estate which can be inherited by his successor either by testamentary succession or by non-testamentary succession. Mr. Chatterjee, further contended that the shares which the testatrix held in Birla Corporation Limited is no doubt a heritable estate which can be inherited by her successor either by testamentary or by intestate successor. He argued that as a shareholder of the company, the testatrix could have exercised various rights under the Companies Act. The testatrix had the right to vote in selecting the Directors also. The right to vote in selecting the Director of the company and/or exercise of the other rights recognized under the Companies Act are all heritable rights which her successor will inherit on her death. Since the testatrix died leaving a Will and the Will is yet to be probated, the testamentary Court, according to Mr. Chatterjee, can make certain provisions under Section 247 of the Indian Succession Act for protection/preservation of the estate of the testatrix so that the estate of the testatrix is not jeopardized during the pendency of the probate proceeding. Mr. Chatterjee, thus, contended that the exercise of the right of the shareholder under the Companies Act which is recognized by the Hon’ble Supreme Court in the case of Girnar Traders (3) Vs. State of Maharashtra & Ors. reported in 2011(3) SCC1can be protected by the Probate Court during the pendency of the probate proceeding. He further contended that, in fact, such protection has already been given by the Probate Court by way of appointment of the “APL”. which has already got its name registered in respect of the shares left by the testatrix. He pointed out that when the present Board of Directors was constituted in the last Annual General Meeting, the “APL”. was very much functional and it never expressed its dissatisfaction in selecting the Directors of the said company in the last Annual General Meeting. He further contended that during the period when the “APL”. was very much functional, the “APL”. also never expressed its dissatisfaction in the way in which the company was managed by the present Board of Directors. He further argued that if the company is not properly managed by the present Board of Directors or, in other words, if the company is mismanaged by the present Board of Directors, the shareholders has the right to initiate action for removal of the Board of Directors by convening Extraordinary General Meeting, and if the shareholders intend to complain against the mismanagement of the company by the Board of directors, the shareholder may initiate a proceeding under Section 397 of the companies Act, before the competent authority in accordance with the provision of the Companies Act. He, thus, contended that in case of the mismanagement of the company, the shareholders and/or their legal representatives cannot approach the Testamentary Court to redress their grievances as the testamentary Court cannot play the role of either the Company Law Board or the company Court to implement and/enforce the provisions of the Companies Act. He contended that when a statute gives a right and provides a forum for adjudication of rights, remedy has to be sought only under the provisions of that Act. According to him when an Act creates a right or obligation and/or enforces the performance thereof in a specified manner, that performance cannot be enforced in any other manner. Enforcement of a right/obligation under a statute can only be achieved by a person aggrieved by invoking the provisions of the said Act. In conclusion he submitted that it is well-settled that what cannot be done, directly cannot be permitted to be done indirectly. He, thus, contended that if the applicants have any grievance regarding mismanagement of the said company by the Directors, the applicants and/or the “APL”. can seek appropriate remedy before the appropriate forum i.e., the Company Law Board under the Companies Act. Mr. Chatterjee also informed this Court that several applications were filed by the applicants before the Company Law Board. In support of his contention, that the testamentary Court is not competent to grant the reliefs which the applicants have claimed in this application, as the jurisdiction to grant such relief is vested exclusively upon the Company Law Board under the Companies Act and not upon the Testamentary Court, he has relied upon the following decisions of the Hon’ble Supreme Court:1. In the case of Dayal Singh & Ors. Vs. Union of India reported in (2003) 2 SCC593Paragraph 33 2. In the case of Laxmidas Morarji (dead) by LRS. Vs. Behrose Darab Madan reported in (2009)10 SCC425paragraph 25 . and 3. In the case of Kanwar Singh Saini Vs. High Court of Delhi (2012)4 SCC307paragraph 23. He thus, invited this Court to dismiss this application as this Court has no jurisdiction to grant the reliefs as prayed for in this application under the Indian Succession Act. Mr. Chidambaram, Learned Senior Counsel appearing for the applicants, very fairly submitted at the very outset, that he does not dispute the contention of Mr. Mitra that the newspaper reporting per se is not admissible in evidence. In effect he accepted the proposition of law argued by Mr. Mitra, that the newspaper reporting cannot be admitted into evidence unless the reporter who publishes such report is examined and/or files affidavit supporting the correctness of such reporting. He further, submits that evidence is different from pleadings. According to him the pleadings are required to be proved by evidence and evidence need not be disclosed in the pleadings. How far a party is able to substantiate his pleading by evidence will be considered by the Court at the final hearing of the suit. But at this stage when the maintainability of this application is questioned by the opposite parties by filing an application in the form of demurrer, the Court according to him, is required to consider the maintainability of such application by applying principles underlying Order 7 Rule 11 of the Code of Civil Procedure. According to him when the maintainability of the application is an issue before the Court, the Court will have to consider the maintainability of this application by accepting each and every statement made in the application as true and correct and if even after accepting the statements made in the application as correct, the Court comes to the conclusion that the application is barred by limitation and/or is otherwise not maintainable due to bar of law then the Court may reject the said application by holding it as not maintainable. In support of his submission he has referred to a decision of the Hon’ble Supreme Court in the case of Ramesh B. Desai & Ors. Vs. Bipin Vadilal Mehta & Ors. reported in (2006)5 SCC368 wherein it was held that demurrer is an Act of objecting or taking exception or a pretext. It is the pleading by a party to a legal action that assumes the truth of the matter alleged by the opposite party and sets up that it is insufficient in law to sustain his claim or that there is some other defects on the face of the pleadings constituting a legal reason what the opposite party should not be allowed to proceed further. When a plea in the nature of demurrer is raised by the opposite party, the question of jurisdiction has to be determined with advertent to the allegation contained in the statement of claim by accepting the allegations made in the application as true and correct. He, thus, contended that if this principle is applied in the present case then the Court will have to examine the maintainability point by accepting that all the statements made in the application by the applicants as true and correct. By referring to the statements made in the application Mr. Chidambaram, learned Senior Counsel, contended that the applicants stated in the application that the Birla Corporation Limited is now going to acquire four units of cement manufacturing companies of Reliance Infrastructure by purchasing its shares and if those units are acquired then the debt burden of the company will increase creating further encumbrances on its existing and future assets. He thus, invited me to consider the maintainability of this application by accepting these statements made by the applicants as true and correct. Though he contended that the newspaper reporting is not admissible per se but to support the statements a supplementary affidavit has been filed by the applicants enclosing statutory notifications issued by the company regarding the said transaction and thus he contended that the Court while deciding the maintainability issue will have to accept the allegations that the Birla Corporation Limited is going to acquire those cement manufacturing units of those companies and if the proposal for acquiring those cement manufacturing units of the said company is actually implemented then the debt burden of the company will increase by rupees three thousand one hundred crore as mentioned in the said application as true and correct. Mr. Chidambaram also submitted that the instant application has been filed only for the purpose of ascertaining as to whether the proposal of acquiring those cement manufacturing units by Birla Corporation Limited is beneficial for the said company or such proposal is detrimental to the interest of the company. According to him such determination is to be done by the Probate Court itself as it is the duty of the Probate Court under Section 247 of the Indian Succession Act to preserve and/or protect the estate of the deceased during the pendency of the probate proceeding. He, thus, contended that if ultimately it is held that acquisition of these cement manufacturing units by the Birla Corporation Limited is detrimental to the interest of the said company and, as a result, thereof the shareholders will ultimately be affected then certainly the probate Court can pass suitable direction on this application to protect the estate of the deceased which consists of shares held by the testatrix in Birla Corporation Limited. Mr. Chidambaram further contended that he also does not want to join an issue with Mr. Mitra on the question of rights and obligations of the shareholders vis-à-vis the Directors. He however, contended that here is the case where the enforcement of the rights of the shareholders against the Director is not an issue before this Court presently. According to him, presently the Court will have to examine as to how the Control over the management of the M.P Birla Group of Company which Mrs. Priyamvada Devi Birla used to exercise as promoter of the M.P Birla Group of Companies, has to be exercised by the representative of the Probate Court during the pendency of the probate proceeding. By referring to the various judgments of this Court passed either by the Learned Single Judge of this Court or by the Division Bench of this Hon’ble Court at different stages of the interlocutory proceeding, he pointed out that the control over the management of the M.P Birla Group of Company was held to be a part of the estate of late Priyamvada Devi Devi Birla. Such findings according to Mr. Chidambaram is binding upon the parties as well as upon the Court at the interlocutory stage. He thus, contended that while considering the issue regarding maintainability of this application, the Court should proceed by accepting the said findings that the control over the Birla Group of Company which is a part of the estate of Priyamvada Devi Birla, is binding upon the Court. By referring to the Will of Priyamvada Devi Birla he pointed out that the control over the management of the M.P Birla Group of Company which was also transferred by her to the legatee under the Will and, as such, it cannot be said that her control over the M.P Birla Group of Company does not belong to the estate of late Priyamvada Birla. He thus, contended that this control over the management of M.P Birla Group of Company which Priyamvada Birla used to exercise during the life time, was an intangible asset which was alleged to have been transferred by her under the Will which is the subject matter of consideration in this testamentary suit. According to him, since the control over the management of the Birla Group of Company was an intangible asset of Priyamvada Devi Birla and further since such intangible asset was alleged to have been bequeathed by the said Priyamvada Devi Birla under her Will which is the subject matter of consideration in this testamentary Court, the Testamentary Court should make some arrangement to protect such controlling power which is a part of the estate belonging to the deceased during the pendency of the probate proceeding so that the control over the M.P Birla Group of companies can be exercised by the representative of the Court to be appointed under the provisions of Section 247 of the Indian Succession Act. Mr. Chidambaram, however, contended that, in fact, an “APL”. was appointed by this Court for the purpose of administering the estate of the deceased which is inclusive of exercising the power of control over the M.P Birla Group of Companies. However, since the said “APL”. has now become nonfunctional due to resignation tendered by one of its member and accepted by the Court, it is the duty of the testamentary Court to pass suitable direction so that even in the absence of the “APL”., estate of the deceased is not burdened and/or jeopardized in any way. He thus, contended that the probate Court has to make effective provision so that the control as defined in Section 2(27) of the Companies Act which could have been exercised by the promoter of the company can be exercised by the representative of the Court or by the Court itself during the pendency of the probate proceeding. Mr. Chidambaram, learned Senior Counsel, submits that the controlling block of shares held by Priyamvada Devi Birla in M.P. Birla Group of companies is the main asset of the estate of Priyamvada Devi Birla. Priyamvada Devi Birla used to exercise control over entire holding of 62.9 % shares of the company (BCL) which was held by different entities through directly or indirectly through the interlinking, chain and cross-holding of shares of the companies over which she had control. Apart from the shares she had in the said company she bequeathed her controlling power over the M.P. Birla Group of companies in favour of Rajendra Singh Lodha by her alleged will and, in fact, Rajendra Singh Lodha assumed his power to exercise control over the M.P Birla Group of companies by virtue of the provision made by the testatrix in her alleged Will and after the death of Rajendra Singh Lodha, his son Harsh Vardhan Lodha has assumed control over the management of the said company Her further argued that with the appointment of the APL, the power to exercise such control over the M.P Birla Group of companies passed to the said “APL”. which exercised its power of control over the M.P Birla Group of companies since the time of appointment of “APL”. till it became non-functional on account of acceptance of the resignation of one of the members of the said “APL”. by the Hon’ble Supreme Court on 17th December, 2014. written by the “APL”. to the Chairman By referring to the letter and the Board of Directors of the said company, Mr. Chidambaram pointed out that the “APL”. intimated the Chairman and the Board of Directors of the said company about the vesting of the controlling block of shares of Priyamvada Devi Birla in the said company with the “APL”. and some information relating to ownership, control and management of the said companies were sought for from the said company and the said company in its letter written to the “APL”. on 18th March, 2014 not only accepted the said “APL’s”. control over the said company but also furnished all the information which were sought for by the ‘APL”. in the aforesaid letter relating to the activities of the said company. Mr. Chitambaram thus, contended that had the “APL”. been active and operational till today, the “APL”., in exercise of its power to exercise control over the said company could have assessed the business company relating to the proposed taking over of four prospect of the said cement manufacturing units of Reliance Infrastructure. He, thus, contended that since the “APL”. is presently non-functional such exercise should be made by the Probate Court. Mr. Chidambaram has referred to the following decisions of the House of Lords as well as the Hon’ble Supreme Court to demonstrate as to what is the meaning of such controlling power and how this controlling power can be exercised in all decision making process relating to the business management of a company:1. In the case of British American Tobacco Company Ltd. Vs. Inland Revenue Commissioners reported in 1943(1) All England Law Reports 13.
2. In the case of Barlays Bank Ltd. Vs. Inland Revenue Commissioners Volume XXXVIII Income Tax reports (Estate Duty) 88.
3. In the case of Commissioner of Income Tax Bombay City-1 Vs. Jubilee Mills Ltd. reported in Volume XLVIII194. In the case of Vodafone International Holdings BV Vs. Union of India & Anr. reported in (2012) 6 SCC613 By referring to aforesaid decisions he contended that the phrase controlling interest is a concept which is capable of controlling only a proprietary right i.e., an interest in the nature of ownership. He pointed out that the House of Lords interpreted the conception of controlling interest in a way which may well cover the relationship of one company towards another, the requisite majority of whose share are, as regards their voting power, subject, whether directly or indirectly, to the will and ordering of the first mentioned company. He also argued that the Hon’ble Apex Court has also in several decisions discussed the concept of the controlling interest. It was held that control of a company vests in the voting powers of its shareholders and the shareholders holding a controlling interest can determine the nature of the business, its management, enter into contract, borrow money, buy, sell or merger of the company. It was also held that the shares in a company may be subject to premiums or discounts depending whether they represent controlling or minority interest. It was further held that control, of course, confers value but the question as to whether one will pay a premium for controlling interest depends upon whether the potential buyer believes that one can enhance the value of the company. He thus, contended that since the testatrix had 62.9% shares in the said company through directly or indirectly through the interlinking, chain and crossholding of shares of the companies, she during her life time exercised her controlling power over the company and further when her estate comprises of such controlling power over the business management of the said company, the probate Court in the absence of the “APL”. has to pass appropriate order for proper preservation of the assets of the said company so that reasonable chance of any property belonging to the Estate of being dissipated, pending the actual grant of the probate or making the “APL”. functional, can be avoided. He further contended that “control”. and “Promoter”. have been defined in Section 2(27) and Section 2(69) of the companies Act, 2013 respectively, and how the promoter will exercise his control over the management of the company has also been defined in various provisions of the said Act viz., Section 167(3), Section 168(3), Section 289(1) etc. of the said Act. He also contended that since exercise of the control over the M.P. Birla Group of companies was an asset belonging to the estate of Priyamvada Devi Birla and the estate representing 62.9% share in the said company directly or indirectly through the interlinking, chain and cross-holding of shares of the companies, the estate retains the power of removal of Directors in case they refuse to accept its proposal. Exercise of such power to control the said M.P Birla Groups of Companies was assumed by the executor immediately after the death of the testatrix. However, since the appointment of A.P.L such power to control was exercised by the “APL”. until it become non-functional due to resignation of one of its members. Taking advantage of such situation, the Chairman of the Board of Directors Viz., H.B.L. has again assumed his control over the Board of Directors. By referring to the supplementary affidavit filed by the appellants, Mr. Chitambaram pointed out that the B.C.L has proposed to acquire the four cement manufacturing company of Reliance Infrastructure Ltd. partly by utilizing its own fund and mostly by borrowing money. He thus, contended that when B.C.L now proposes to acquire these four cement manufacturing units mostly by borrowing money, the Probate Court before allowing the B.C.L to implement the said project should consider the prospect of such business and risk factor which is involved in making such huge investment for the said project. He further contended that since for making such assessment regarding viability of the said proposed business expansion, the presence of B.C.L is necessary, his clients have prayed for leave to serve a copy of this application upon B.C.L so that after hearing the B.C.L and after considering the papers relating to such transaction, the Court can ultimately decide the viability of the said proposed business expansion. Since Harsh Vardhan Lodha is the Chairman of the Board of directors, direction was sought for upon the said Harsh Vardhan Lodha and the BCL for production of the relevant papers relating to such consideration before the Court and injunction was sought for against them so that such transaction is not finalized before the Court takes the decision regarding viability of the said proposed business expansion. He referred to the provisions contained in Section 247 and Section 269 of the Indian Succession Act to convince the Court that Probate Court has the jurisdiction to pass the orders which are sought for in this application and he invites the court to pass interim order of injunction for restraining Harsh Vardhan Lodha and B.C.L from executing such contract and/or from acquiring these four units of the cement manufacturing company until the Court takes a decision on the viability of such proposed business expansion. According to him Probate Court’s jurisdiction to grant such injunction in exercise of its inherent power, is recognized by this Court as well as by the other High Courts in the following decisions:1. In the case of Neodebarni Devi Vs. Chamatkarini Devi reported in 27 Indian Cases 617.
2. In the case of Atula Bala Dasi Vs. Nirupama Devi reported in A.I.R1951Calcutta 561.
3. In the case of Amarendra Dhwaj Singh & Anr. Vs. Prem Kumar Sing & Sons reported in 2013 (1) PLJR853 He further submitted that even the Probate Court’s power to grant injunction against the third party, is recognized by Delhi High Court in he following cases:1. In the case of Sri Kulbir Singh Vs. State & Ors. reported in Indian Law Reports (1994)1 (DelhI) 328.
2. In the case of Shri Karamjit Jaiswal Vs. Investec Trust (Jersey) Limited & Ors. reported in 180(2011) DLT15 He thus, submitted that since a vacuum has been created due to “APL”. become non-functional, the Probate Court is the only forum where necessary orders can be passed for proper preservation of estate of the deceased so that no part of the estate of the deceased is dissipated during the pendency of the probate proceeding. According to him, other remedies such as initiation of the process for removal of the Board of Directors, moving the Company Law Board for enforcement of the promoter’s power of control or filing a civil suit which were available to the promoter for redressal of the promoter’s grievances, cannot now be availed of by the Applicants even though they have caveatable interest as the “APL”. is now the registered shareholders of BCL. As such he invited this Court to entertain this application and decide the same on merit. Before concluding he also submitted that the Court’s power to grant leave to file supplementary affidavits for production of evidence under Order 7 Rule 14(3) of the Civil Procedure Code is also recognized by this Court in the case of Kejriwal Enterprises Vs. General Manager, Ordnance Factory & Ors. reported in AIR2004Cal 225. As such according to him leave was rightly granted by this Court to the applicant to file supplementary affidavit. Mr. Pal, learned Senior Counsel, appearing for the other group of defendants in support of their application being G.A No.189 of 2006 adopted the submission of Mr. P. Chidambaram. He however, tried to distinguish the cases cited by Mr. Mitra, learned Senior Counsel appearing for the Lodhas. He tried to convenience this Court that the decisions cited by Mr. Mitra are not applicable in the facts of the present case. He submitted that the decision in the case of Lakxmi Raj Shetty & Anr. Vs. State of Tamil Nadu (supra) and in the case of Ravinder Kumar Sharma Vs. State of Assam & Ors. (supra) which were cited by Mr. Mitra, in support of his submission that the newspaper reportings are not admissible evidence and as such no reliance can be placed upon this newspaper reporting, is not applicable to the present proceeding being an interlocutory proceeding which is tried on affidavit and no evidence is required to be produced at the stage of hearing the interlocutory application. He submitted that though the principle laid down in those decisions are well-accepted but when a demurer challenges the maintainability of an application, according to Mr. Pal he must accept all the statements of facts made in the petition to be true and correct even though such statements are not supported by evidence. He thus, contended that while considering the maintainability of this application whether the statements made in the application are admissible in evidence or not, the Court should take into consideration all the statements as correct while ascertaining the objection relating to maintainability of the application. The demurrer according to him, must satisfy the Court that even accepting all the statements of facts made in the petition as true and correct, the application is not maintainable. He further submitted that the decision in the case Barium Chemicals Ltd. & Anr. Vs. Company Law Board & Ors. reported in AIR (1967) SC295which was cited by Mr. Mitra to show that the evidence must be produced in support of the allegation made in the pleadings, has no application in the present case, as at this stage when the Court is considering the maintainability of the application, the Court will have to examine as to whether the reliefs claimed in the application, can be granted by the Court or not by accepting that all the statements made in the petition are true and correct. According to him, the Court cannot at this stage proceed on the assumption that the party making such pleading may not be ultimately successful in proving the same. He further contended that the decisions which were cited by Mr. Mitra in the case of Bacha F. Guzdar Vs. Commissioner of Income Tax, Bombay reported AIR1955SCC page 74 (supra), in the case of Rustom Cavasjee Cooper Vs. Union of India (supra), reported in (1970) 1 SCC248 in the case of Western Coalfileds Limited Vs. Special Area Development Authority, Korba and Ors. reported in (1982)1 SCC125and in the case of Din Chemicals & Coatings Pvt. Ltd. Vs. State of W.B reported in 2012 SCC Online Cal 10950, to support his contention that the shareholders do not have any interest in the assets of the company have no application in the facts of the instant case as this is a case where the applicants have not come forward to exert their right in respect of the assets of the company rather they claimed that the controlling block of share holding which is an asset of the estate of the deceased is properly protected, preserved and is not dissipated during the pendency of the probate proceeding as preservation and protection of the estate i.e., the controlling block of share holding in the company pending disposal of the probate proceeding, is necessary under Section 247 of the Indian Succession Act. He further contended that the decisions cited by Mr. Mitra in the case of Cochin Malabar Estates & Industries Ltd. & Anr. Vs. P.V. Abdul Khader & Anr. and N.K Mohammad Ali & Ors. reported in (2003) 114 Comp Case 777 and decision reported in (2014) 3 SCC page 1 to support of his contention that the grievance of a shareholder regarding the affairs of a company can only be agitated before Company Law Board and not before the High Court have no application in the fact of the instant case as this is not a case where application has been filed by the applicant qua shareholders. Rather it has been filed for protection and preservation of the estate under Section 247 of the Indian Successions Act. He further contended that in view of the decision of this Hon’ble Court passed on 10th May, 2013 in a proceeding under Section 10(F), the Probate Court, and not the Company Court, has the jurisdiction to resolve the dispute between the parties relating to the estate of Priyamvada Devi Birla i.e., controlling Block of the shareholders of M.P Birla Group of Companies. He further contended that the decisions cited by Mr. Mitra in the case of General Secretary Vs. Zonal Manager reported in 65 C.W.N32 in the case of Jagdish Prasad & Anr. Vs. Pt. Paras Ram & Ors. reported in AIR1941Allahabad 360 and in the case of Subarban Bank Private Ltd. Trichur Vs. Thariath & Anr. reported in AIR1968Kerala 206 to support of his contention that the shareholders of company cannot control the power conferred on the Board of Directors of the company without taking recourse to removal of the Directors or alteration of the articles have no application in the present case as in the present application we are only concerned as to how the controlling block of shares comprises in the estate of the deceased over which “APL”. has been appointed can be preserved or protected until the “APL”. is made functional. He further contended that under the provision of Section 247 of the Indian Succession Act, the Probate Court can pass effective order and for implementing the said order the probate Court can issue notice to the person in management (Board of Directors) in order to give him an opportunity to explain before the probate Court that value of controlling of block of share holding is not being jeopardized, if the proposed transaction is ultimately implemented. Mr. Pal, further pointed out that the decisions cited by Mr. Mitra in the case of Kishorsing Ratansinh Jadeja Vs. Maruti Corporation & Ors. reported in (2009) 11 SCC229 in the case of Smt. Ram Rakhi Vs. Union of India & Ors. reported in AIR2002Delhi 458, in the case of Varghese Vs. Fast Line Builders and Developers Kerala Pvt. Ltd. reported in 2013 (2) KLJ695 in the case of West Bengal Housing Board Vs. Pramila Sanfui & Ors. reported in 2016 (1) SCC Page 743 and in the case of K.P.M Aboobucker Vs. K. Kunhamoo & Ors. reported in AIR1958Madras 287, in support of his contention that the Probate Court cannot pass any injunction order against a person who is not a party to the proceeding has no application in the instant case as this is a case where leave was sought for from the Court for serving a copy of the notice upon Birla Corporation Limited so that the merit of the said application can be decided by the Court after giving a reasonable opportunity of being heard to the said company. He further contended that the decision which was cited by Mr. Mitra, in the case of Kanwarjit Singh Dhillon Vs. Hardyal Singh Dhillon & Ors. reported in (2007) 1 SCC page 357 to support of his contention that the Probate Court cannot decide the disputed question of title, has no application in the present case as the title relating to the estate of the deceased i.e., in controlling block of shares is not under challenge in the present application. He further argued that the decision cited by Mr. Mitra in the case of Official Trustee, West Bengal and Ors. Vs. Sachindra Nath Chatterjee & Anr. (supra) to support of his submission that an application should be rejected on the ground of its maintainability if the Court trying such application is found to have no jurisdiction to decide the issues in the suit and to grant the reliefs prayed for therein, has no application in the instant case, as the present application has been filed for preservation and protection of the assets of the estate during the pendency of the probate proceeding before the Probate Court which has jurisdiction to pass appropriate order to preserve and protect the estate of the deceased under Sections 247 and 269 of the Indian Successions Act, 1925. He further contended that the decision cited by Mr. Mitra, in the case of Bharat Petroleum Corporation Ltd. Vs. Hari Chand Sachdeva & Ors. reported in AIR2001Delhi 307 and in the case of K.P.M Aboobucker Vs. V.K. Kunhamoo & Ors. reported in AIR1958Madras page 287 to demonstrate that the Court has no jurisdiction to entertain any application when the reliefs claimed in the application cannot be granted by the Court, has no application in the present case as the Probate Court has jurisdiction to pass necessary order under Section 247 of the Indian Successions Act to preserve the controlling block of share holding which is an asset belonging to the estate of deceased. He further contended that the decisions cited by Mr. Chatterjee in the case of Dayal Singh & Ors. Vs. Union of India & Ors. reported in (2003) 2 SCC page 593 in support of his contention that what cannot be done directly cannot be done indirectly, has no application in the present case as the applicants have not sought to achieve any relief indirectly what cannot be achieved directly. Lastly, he contended that the decision which was cited by Mr. Chatterjee reported in 2012(4) SCC page 307 to support that an order passed by a Court having no jurisdiction over the subject matter is nullity is of no relevance in the facts of the present case as the Testamentary Court dealing with a probate matter has jurisdiction pass necessary interim order under Section 247 of the Indian Successions Act to protect and/or preserve the property belonging to the estate of the deceased, pending disposal of the probate Suit. Mr. Pal thus, ultimately concluded by submitting that presently the Court will have to decide the only basic question i.e., as to whether the petition being G.A No.189 of 2006 is demurrable or not. He thus, contended that the other question which is raised by Mr. Mitra and/or Mr. Chatterjee in course of their submission i.e., as to whether the value of the estate comprising of the controlling block of shares runs the risk of devaluation since the value of the estate, has an intimate relationship with the assets of the company and further as to whether the Court of conscience must be satisfied that nothing is done which would expose the estate to a risk without due diligence with reasonable care and caution need not be decided by the Court presently as all these issues relating to the merit of the petition can only be decided after exchange of affidavits between the parties. Mr. Pal thus concluded by submitting that the application which is now under consideration before this Court is well maintainable and thus, he invites the Court to consider the said application on merit and to pass some interim protection, pending disposal of this application, so that the object of filing this application is not ultimately frustrated. Mr. Mitra, Learned Senior Counsel appearing for the Lodhas, while arguing in reply, maintained his earlier stand that the present application is not maintainable as the reliefs which the applicants have claimed in the application cannot be granted by the Probate Court. He contended that the Probate Court cannot pass any order under Section 269 of the Indian Successions Act, According to him the said Section is not applicable to the present case, as the deceased was Hindu and thus, in view of sub-Section 2 of Section 269 of the said Act, the Probate Court cannot pass any order under Section 269 of sub-Section 1 of the said Act. He contended that Section 247 of the Indian Successions Act is the only provision under which the Probate Court can appoint an administrator pendente lite for proper protection and preservation of the estate of the deceased and in the present case this has already been done by the Appeal Court which appointed three member deceased in of “APL”. which has got all the shares held by the Birla Corporation Limited registered in its name in terms of the order passed by the Probate Court earlier. And as such the shares of the deceased are all protected. He further contended that though it is true that the “APL”. is not functional as on date because of the resignation of one of its members but according to him even if it is made functional still then the “APL”. cannot exercise the controlling power over the Board of Directors of the company on which exclusive jurisdiction was vested by Section 179(3) of the Companies Act, 2013 to decide in its Board Meeting to take over a company or acquire a controlling or substantial stake in another company. By relying upon the provision contained in 179(3)(d) of the Companies Act, he reiterated that the said provision vests power with the Board of Directors of the company exclusively to pass a resolution in a Board meeting for borrowing monies and if borrowing of such money does not contravene the provision of Section 180(1)(c) of the companies Act then no complain can be made against the decision of the Board of Directors for borrowing money for running the business of the company. He thus, contended that when the jurisdiction to take over the business of another company and to borrow money have been vested exclusively with the Board of Directors under those provisions of the Companies Act and when such powers of the Board of Directors are uncontrolled by the decision of this shareholders and/or the promoters, the shareholders and/or the promoters cannot complain against the decision of the Board of Directors in acquiring four units of another cement manufacturing company. He thus, ultimately concluded that had the “APL”. been operative still then the APL in exercise of its controlling power could not impose its decision over the decision of the Board of Directors in acquiring four units of another cement manufacturing company partly with its own capital and partly by borrowing money from the market. He distinguished the decisions cited by Mr. P. Chidambaram in support of his contention that the Probate Court can pass injunction order even against the third party to protect and/or preserve the estate of the deceased pending probate proceeding and submitted that in none of these decisions, it was held that injunction can be passed by the Probate Court against third party. By reading the decisions in the case of Neodebarni Devi Vs. Chamatkarini Devi reported in 27 Indian Cases page 617, in the case of Atula Bala Dasi Vs. Nirupama Devi reported reported in AIR1951Cal page 561, in the case of Amarendra Dhwaj Singh & Anr. Vs. Prem Kumar Sing & Sons reported in 2013(1) PLJ page 1853 and in the case of Shri Karamjit Jaiswal Vs. Investec Trust (Jersey) Limited & Ors. reported in 2011 of 180 DLT page 15, Mr. Mitra pointed out that in none of the aforesaid decision it was held by the High Courts that Probate Court can pass any injunction order against third party to protect and/or preserve the estate of the deceased. In the decision reported in 27 Indian Cases 617 and also in the decision reported in AIR1951Cal 56, their Lordships held that for proper preservation and/or protection of the estate of the deceased so that no part of the estate of the deceased is dissipated pending probate proceeding, the Probate Court in exercise of its jurisdiction under Section 247 of the Indian Successions Act can appoint administrator pendente lite and until such appointment is made, the Probate Court in exercise of its inherent jurisdiction, can pass appropriate injunction order restraining the parties to the proceeding from selling and/or dealing with the property belonging to the estate of the deceased. The other decisions cited by Mr. P. Chidambaram; one of Patna High Court and another of Delhi High Court were placed before this Court by Mr. Mitra to show that in those cases also injunction was passed by the Probate Court against the parties to the proceeding and in respect of a property admittedly belonging to the estate of the deceased. Mr. Mitra contended that in none of these decisions it was held that Probate Court can pass injunction order against third party. Mr. Mitra further contended that it is rightly pointed out by Mr. Chidambaram that in case the shareholders and/or the promoter has any grievance against the decision of the Board of Directors, they may take various steps including, removal of the Directors by applying the provisions contained in Companies Act. He thus, contended that the Probate Court while dealing with a probate proceeding cannot preempt the proceeding either of the Company Law Board or of the Regular Civil Court, to decide the disputes which are triable by the Company Law Board and/or the Company Court and/or the other Civil Court. He thus, contended that even if any step is required to be taken preservation and/or maintenance of the estate for of the deceased i.e., shares belonging to the deceased in the Birla Corporation Limited and/or controlling the power which Mrs. Birla used to exercise during her life-time, still then such steps should be taken by following the provisions of the Companies Act and by approaching forum prescribed under the Companies Act. He ultimately concluded that even the “APL”. remained operative, still then the “APL”. could not have taken any step without taking recourse to the provisions of the companies Act and without approaching the appropriate authorities under the Companies Act for seeking appropriate reliefs. According to him even the “APL”. cannot encroach upon the jurisdiction of the Board of Directors in the matters where exclusive jurisdiction is vested with the Board of Directors by the Companies Act, 2013. He ultimately concluded by submitting that since the Companies Act, 2013 has not given any power to the promoter to exercise his/her power of control over the decision of the Board of directors in respect of any of the matter enumerated in Section 179 of the Companies Act neither Mrs. Birla, had she been alive today, nor her successor nor “APL”. can interfere with the decision of the Board of Director nor can they impose their decision over the decision of the Board. Let me now consider the maintainability of these applications in the context of the submission made by the learned Counsel appearing for the parties. At the very outset I like to record my agreement with the submission of Mr. Chidambaram, learned Senior Counsel appearing for the applicants that while considering the maintainability of such application, the Court is required to consider the maintainability of such application by applying the principles underlying the provisions contained in Order 7 Rule 11 of the Code of Civil Procedure. The decision which was cited by Mr. Chidambaram in support of his aforesaid contention is worth mentioning here. It was decided by the Hon’ble Supreme Court in the case of R.B Desai Vs. Bipin Vadilal Mehta reported in 2006(5)SCC638 that the demurrer is an act of objecting or taking exception or a protest. It is a pleading by a party to a legal action that assume the truth of the matter alleged by the opposite party and sets up that it is insufficient in law to sustain his claim or that there is some other defect on the face of the pleading constituting the legal reason why the opposite party should not be allowed to proceed further. It was also held therein that in order to examine as to whether the plaint is barred by any law as contemplated by Order 7 Rule 11 (d) of the Civil Procedure Code the Court while considering the maintainability of the plaint, is permitted to see the averments made in the plaint only and no other document. Thus, while considering the maintainability of the plaint the Court is required to consider the plaint, and assume each statement made in the plaint to be correct and then come to the conclusion as to the maintainability of the plaint. It is not permissible to look into the pleas raised in the written statement or to any piece of evidence, at the time of considering the preliminary objection regarding maintainability of the plaint. In my view the same principle is applicable, while considering the demurrer of an application in view of the provision contained in Section 141 of the Civil Procedure Code. Keeping in mind the aforesaid principles of law laid down by the Hon’ble Supreme Court in the aforesaid decision, I will have to examine the maintainability of this application by examining the averments made in this application and the supporting documents annexed thereto which do form part of it. Excepting the averments made in the application and the statements appearing from the documents annexed to the said application, no other pleading and/or document will be considered by this Court while deciding the maintainability of this application. I have already mentioned above the nature of the application and the reliefs claimed therein in a great details. As such for avoiding repetition, I need not narrate the contents of the said application and/or reliefs claimed therein in details. Suffice it to mention herein that such an application was filed by some of the defendants who have caveatable interest in this probate proceeding complaining that Birla Corporation Limited is going to acquire four units of cement manufacturing company of Reliance infrastructure by purchasing its shares involving huge investment of about 4000-4200 crores partly by utilizing the company’s liquid resources of around Rs. 1700/- crores and remaining by borrowing. When they came to know about the decision of the BCL for acquiring the four cement manufacturing units of Reliance Infrastructure partly by utilizing its available liquid resources and partly by borrowing, from various newspaper reports, the applicants became apprehensive about future business prospect of the said company as the debt burden of the company will increase by about Rs.3100/- crores by execution of such deal with Reliance Infrastructure. According to them the controlling block of shares held by late Priyamvada Devi Birla in M.P Birla Group of Companies was the most valuable asset of the estate of the deceased. Such valuable asset and/or the ultimate beneficiaries thereof may ultimately be adversely affected, if the said deal with Reliance Infrastructure is implemented as implementation of such deal may ultimately bring disastrous consequences in the said company. The applicants thus, filed the said applications inviting this Court to examine the viability of the business prospect arising out of acquisition of those four cement manufacturing units of Reliance Infrastructure, before allowing the BCL to complete the said deal. They thus, claimed that until such decision is taken by this Court, the Birla Corporation Limited and/or Harsh Vardhan Lodha one of the plaintiffs in this suit should be restrained from completing the said deal for acquiring the four cement manufacturing units of Reliance Infrastructure by purchasing its shares. In this context a question has croped up before this Court as to whether the Probate Court while examining the genuineness of the Will can grant the reliefs as claimed by the applicants in the probate proceeding or not. Let me first of all consider the extent of jurisdiction of the Probate Court and/or its duties pending consideration for such grant. While deciding a contentious cause relating to a probate Proceeding the only and/or primary duty of the Probate Court is to examine the genuineness of the Will, and while examining the genuineness of the Will, the Court is required to consider (i) as to whether the will was duly executed by the testator and/or testatrix consciously or not; (ii) Whether the execution of the Will by the testator and/or testatrix was duly attested by two witnesses or not; (iii) Whether there was any suspicious circumstances under which the Will was executed by the testator or the testatrix unconsciously and (iv) whether the Will is the last Will of the testator or not. If the testamentary Court after examining the pleadings of the parties and their evidence come to the conclusion that the Will was duly executed by the testator and/or testatrix consciously out of his/her free will and at the time of execution of the said Will, the executor/executrix was physically fit and mentally alert and execution of such will was attested by two attesting witnesses and this was the last Will of the testator and/or testatrix and there was no suspicious circumstances under which such will was executed by the testator/testatrix, then the testamentary Court will grant probate to the said last Will of the testator/testatrix. On the contrary, if the Court finds that the Will was not duly and consciously executed by the testator/testatrix or the Will was not properly attested or this is not the last Will of the testator or there was suspicious circumstances under which such will was executed and the suspicion could not be removed from the minds of the Courts then the Court will have no other alternative but to dismiss the suit. This is the extent of jurisdiction which the Probate Court exercises while considering the plaintiffs’ prayer for grant of probate to the Will of the testator/testatrix. In addition thereto some additional duty is imposed upon the Testamentary Court under Section 247 of the Indian Successions Act i.e, to see as to whether by any act and/or omission on the part of any of the parties, the value of the properties belonging to the estate of the deceased is dissipated or not and in the event it is found that by any action and/or omission on the part of any of the parties, the value of any movable or immovable property belonging to the estate of the deceased is likely to be dissipated then the Probate Court will appoint an administrator pendente lite who will have all the rights and powers of a general administrator other than the right of distributing such estate and every such administrator shall be subject to the immediate control of the Court and shall act under its direction. Let me now consider as to how far the reliefs claimed in this application can be granted by the Probate Court within the short and limited campus of its jurisdiction. Since the shares held by Mrs. Birla in BCL and the controlling power which she enjoyed during her lifetime over M.P Birla Group of companies are the most important and precise asset belonging to the estate of the deceased, the instant applications have been taken out by the applicants so that the above mentioned precious assets belonging to the estate of the company is not dissipated during the pendency of the probate proceeding. To ensure that the proposed deal does not bring about disastrous consequences in the business of BCL, an enquiry is sought for as to what will be the business prospect of the BCL, if the proposed deal for acquiring four cement manufacturing units of Reliance Infrastructure limited is matured. Such enquiry was sought for with an idea that in case it is found that on execution of the said deal any disastrous consequences occurs affecting the interest of the shareholders and/or in the assets of the BCL, the BCL and/or Harsh Vardhan Lodha may be restrained from executing the said deal. An interim order has also been sought for almost in identical manner so that the ultimate deal is not completed before enquiry into the business prospects of the company out of such deal is completed by the Court. Since for taking a decision on the aforesaid subject, the Court is required to consider the due diligence report connected with the said transaction and the other relevant papers and documents referred to in the said application and further since production of such documents cannot be ensured without BCL being made a party to the proceeding and injunction cannot be passed against the Birla Corporation Limited, in its absence, the applicants prayed for leave to serve a copy of the instant applications upon Birla Corporation Limited so that such adjudication is made in the presence of the Birla Corporation Limited. Let me now first of all consider as to how far such prayer for allowing the applicants to serve a copy of the application upon BCL can be allowed by this Court. I have already mentioned above that such applications were filed in a probate proceeding before the Testamentary Court. I think that no elaboration is necessary on the point of law, viz., that none excepting those who have caveatable interest in the probate proceeding, can be allowed to be joined as a party defendant in the suit. Keeping this principle in mind, this court has no hesitation to hold that since Birla Corporation Limited has no caveatable interest in the probate Proceeding, it cannot be added as a party in the probate proceeding. Thus, if I consider the applicants’ prayer for allowing them to serve a copy of these applications upon Birla Corporation Limited from this angle then I hold that such prayer of the applicant cannot be allowed, as the Birla Corporation Limited has no caveatable interest in this probate proceeding. Let me now consider as to whether such relief can be granted to the applicants in a different context. Suppose BCL cannot be impleaded as a party in the probate proceeding as it has no caveatable interest but still then can such company be allowed to participate in the present proceeding only for the limited purpose of ascertaining the business prospect of the said company arising out of the said deal with Reliance Infrastructure in the context of the settled position that shares held by Mrs. Birla in BCL and her controlling Power over the M.P Birla Group of Companies are the most important assets belonging to the estate of Mrs. Birla and the probate Court has a duty to protect and preserve the estate of the deceased, during pendency of the Probate Proceeding. For ascertaining as to whether such leave for service of notice upon BCL can be granted within such short campus, this Court is required to consider as to how far the internal management of BCL can be controlled by the Probate Court in order to protect the interest of Mrs. Birla in the shares held by her in the said company and also to find out the ways by which her controlling power over the M.P Birla Group of Companies can be allowed to be exercised by any officer of the Court pending disposal of the probate proceeding. For finding out answer to the said question it will be beneficial for this Court to refer to the decisions of the Hon’ble Supreme Court in the case of Bacha F. Guzdar Vs. Commissioner of Income Tax, Bombay reported in AIR1955SCC74and in the case of Rustom Cvasjee Cooper and Ors. Vs. Union of India reported in 1970(1) SC248 In both the aforesaid decisions the Hon’ble Supreme Court unanimously held that a company registered under the Companies Act is, a juristic person separate and is distinct from its individual members and the property of the company is not the property of the shareholders. It was held by the Hon’ble Supreme Court in these decision that shareholder has merely an interest in the company arising out of its Articles of association measured by a sum of money for the purpose of fixing liability and by a share in the distributed profit. It was further held therein that a Director of a company is merely its agent for the purpose of management and the holder of a deposit account in a company is its creditor: he is not the owner of any specific fund lying with the company. It was also held therein that a shareholder, a depositor or a Director may not therefore be entitled to move a petition for infringement of the rights of the company, unless by the action impugned by him, his rights are also infringed. Thus, since the shareholder has no interest in the assets of the company, I hold that the assets of the company cannot be an asset belonging to the estate of the deceased. Thus, I hold that on the strength of share holding interest in the company, the shareholder did not acquire any interest in the assets of the company and as such the assets of the company cannot be a part of the estate of the deceased and thus this Court is not required to consider the business prospect of the said BCL arising out of the proposed deal with Reliance Infrastructure to find out as to whether in case the deal with Reliance Infrastructure is ultimately matured then is there any chance of the assets of BCL being dissipated. Mr. Chidambaram, learned Senior Counsel appearing for the applicants tried to impress upon this Court that apart from the shares which Mrs. Birla had in B.C.L, Mrs. Birla as a promoter of the said company used to exercise her power of control over the management of the said M.P Birla Group of Companies and on her death the said power of control being a part of the estate of the said deceased used to be exercised by the “APL”. appointed by the Division Bench of this Court. But since the said “APL”. has now become defunct due to resignation of one of its members, the Probate Court according to him, is the only Court which can consider as to whether the company will be benefited by execution of such deal with Reliance Infrastructure or not. Mr. Chidambaram, learned Senior Counsel, further submitted that had Mrs. Birla been alive today, could such a decision been taken by the Board of Directors without consulting Mrs. Birla. According to him, if the answer is: without consulting Mrs. Birla such proposed deal could not have matured; then by following the same analogy it should be held that even without consulting the “APL”. the Board of Directors of B.C.L could not have taken the ultimate decision for implementation of the said deal. He thus, contended that, since the “APL”. has now become non-functional, it will not be fair on the part of the Board of Directors of B.C.L to execute such deal without obtaining leave from the Probate Court. Mr. Chidambaram, learned Senior Counsel, thus, submitted that if the present problem is considered in the aforesaid context then Court has to draw a conclusion that without examining the business prospect of B.C.L on execution of the proposed deal with Reliance Infrastructure, the B.C.L can not be permitted to complete the said deal. According to him such an enquiry is necessary for protection of the estate of the deceased. He thus, contended that if on such enquiry, it is found that disastrous consequences may occur in the business of the B.C.L resulting fall in price of the share of the company, then certainly the estate of the deceased will be affected. He, thus, submitted that for taking a decision on the aforesaid issue as to the business prospect of B.C.L arising out of the said proposed deal, the relevant documents relating to the said deal are required to be considered by the Court and such enquiry must be held in the presence of B.C.L, so that in its presence the ultimate decision can be taken by the Court and whatever decision will be taken by the Court, such decision can be enforced upon B.C.L. To consider the substance of such contention of Mr. Chidambaram this Court is required to consider as to what power can exactly be exercised by the promoters, having controlling power over the management of the company. The expression “control”. was not defined in the Companies Act, 1956. However, the expression “control”. has been defined in the Companies Act, 2013 in the following manner. Section 2(27) “control”. shall include the right to appoint majority of the Directors or to control the management or policy decision exercisable by a person or persons acting individually or not concert, directly or indirectly, including by virtue of their shareholding or management rights or shareholders agreements or voting agreements or in any other manner; Mr. P. Chidambaram drew my attention to the following decision i.e., some English decisions as well as the decisions of our Apex Court to impress upon me as to what control exactly means and how such control can be exercised by the promoter in the management of the company even when the expression “control”. was not defined in Companies Act, 1956:1. In the case of British American Tobaco Company Limited Vs. Inland Revenue Commissioners reported in 1943(1) all England Reports 13.
2. In the case of Barclays Bank Limited Vs. Inland Revenue Commissioner reported in (1959)Ch. 659 Vol. XXXVIII Income Tax Report (Estate Duty) page 88.
3. In the case of Commissioner of Income Tax Bombay City-I Vs. Jubilee Mills Ltd. reported in Volume XLVIII Income Tax Report (SCC) 9 and 4. In the case of Vodafone International Holdings BV Vs. Union of India and Anr. reported in (2012)6 SCC613 It was held therein that “control”. is a mixed question of law and facts. Ownership of shares may, in certain situations, result in the assumption of an interest which has the character of a controlling interest in the management of the company. A controlling interest is an incident of ownership of shares in a company, something which flows out of holding of shares. A controlling interest is, therefore, not an identifiable or distinct capital asset independent of the holding of shares. The control of a company resides in the voting powers of its shareholders and shares represent an interest of a shareholder which is made up of various rights contained in the contract embedded in the Articles of associations. It was also held therein that the right of a shareholder may assume the character of a controlling interest where the extent of the shareholdings enables the shareholder to control the management. Shares, and the rights which emanate from contract then flow together and cannot be dissected. In fact, shares in a company consist of a congeries of rights and liabilities which are a creature of the Companies Act and the Memorandum and Articles of Associations of the Company. Thus control and management is a facet of the holding shares. Mr. Chidambaram, thus, submitted that keeping in mind the aforesaid meaning of the expression “control”. and “the controlling power”. the Probate Court will have to pass necessary order so that the chance of loss of control over the management of BCL which is a valuable asset of the estate of the deceased, is prevented. Though Mr. Chatterjee, learned Senior Counsel contended that controlling power is not an heritable right and such right cannot be passed to the estate of the deceased, but in view of several decisions of this Court at various interlocutory stages in this probate proceeding, it has now been settled that exercise of the controlling power over the M.P Birla Group of companies is a valuable asset of the estate of Mrs. Birla. Such findings of this Hon’ble Court arrived at different stages of the interlocutory proceedings, is not only binding upon the parties but also is binding upon this Court and as such, I have no hesitation to hold that such controlling power is an important and valuable asset belonging to the estate of Mrs. Birla. Now question is as to how such controlling power can be exercised by the promoter. Can it be exercised by the promoters of the company without following the provisions of law?. In my considered view, such controlling power over the management of the company cannot be exercised by the prompters and/or the promoter group in derogation of the provision of the Companies Act and/or the contract contained in the Articles of Associations. The Companies Act, 2013 has defined the expressions “Control”. and the promoter in Section 2(27) and Section 2(69) of the said Act respectively. How the promoters can exercise their power of control over the management of the company has also been enumerated in different provisions of the Companies Act viz., in Section 167(3), Section 168(3), Section 289(1) etc. Thus, I hold that exercise of controlling power by the promoter is controlled and/or regulated by the provisions of the Companies Act. Controlling power cannot be exercised according to the whims of the promoter. To examine as to how much controlling power could have been exercised by Mrs. Birla, had she been alive today, over the decision of the Board of Directors in the decision making process for taking over the four cement manufacturing units of Reliance Infrastructure, this Court is required to consider the provisions contained in Section 179(3) and Section 180 of the Companies Act, 2013. The powers of the board is defined in Section 179 of Companies Act. SubSection (3) of Section 179 of the companies Act provides that the Board of Directors of a company shall exercise the powers enumerated therein on behalf of the company by means of resolution passed at a meeting of the Board. Several powers which can be exercised by the Board of Directors exclusively are enumerated in Section 179(3) of the said Act. Some of such powers which are relevant for the present purpose are mentioned herein. Section 179(3)(J) authorizes the Board of Directors to take over a company or acquire a controlling or substantial stake in another company. Section 179(3)(d) authorizes the Board of Directors to borrow money for implementation of its business projects. However, borrowing such money by the Board of Directors is not uncontrolled. The Board of Director’s power to borrow money is controlled by Section 180(1)(c) which provides that the Board of Directors enjoys uncontrolled power to borrow money, where money to be borrowed together with the money already borrowed by the company, will not exceed aggregate of its paid-up share capital and free reserves, apart from temporary loans obtained from the company’s bankers in the ordinary course of business. The expression “temporary”. loans has also been defined in the explanation added to the said Section which means loan repayable on demand or within six months from the date the loans such as short-term, cash credit arrangements, the discounting of bills and issue of other short-term loans of a seasonal character, but does not include loans raised for the purpose of financial expenditure of a capital nature. On consideration of those two provisions of the Companies Act, I have no hesitation to hold that Board of Directors of a company is authorized to exercise its power on behalf of the company by means of resolution passed in a meeting of the Board to take over a company or acquire a controlling or substantial stake in another company even by borrowing money subject to the restriction imposed under Section 180(1)(C) of the Companies Act. There is no allegation in the petition that even the decision for implementation of the said project by borrowing money was taken by the Board of Directors contravening the provision of Section 180(I)(C) of the Companies Act, 2013. No other provision from the Companies Act could be pointed out by the learned Senior Counsel appearing for the applicants to demonstrate that the authority which was given to the Board of Directors under the Companies Act as mentioned above is subject to the control to be exercised by the promoter. If that be so then can it be said that such decision of the Board of Directors for expanding its business by taking over four cement manufacturing units of Reliance Infrastructure cannot be implemented without approval of the promoters of the said company. My answer to this question is in the negative as I hold that jurisdiction to exercise such power which is vested with the Board of Directors is not controlled by the decision of the promoters, even though the promoter and/or the group of promoters hold controlling power over the management of the said company. It may be mentioned herein that in the present case such decision for taking over four cement manufacturing units of Reliance Infrastructure was taken unanimously by the Board of Directors where out of nine Directors six are independent Directors elected in the Annual General Meeting held on 2014 when “APL”. was very much functional and it does not appear from the annexures which are part of the present application that APL ever complained of any indecision of the Board of Directors resulting bringing about any disastrous consequences in the business of the B.C.L resulting fall in the share price of the shareholders. Let me now consider the present problem from a different angle. Suppose the decision taken by the Board of Directors in this regard is not approved by the promoters what maximum the prompters can do to enforce his decision over the decision of the Board of Directors. If the promoters hold majority shares then certainly they are not remediless as several remedies are prescribed under the Companies Act, 2013 for exercising their right of control over the Board of Directors before different forum such as Company Law Board, other Civil Court etc. They may also initiate the process of removal of the Directors and appointment of Directors of their choice in the place of the removed Directors. But no such step can be taken without following the provisions of the Companies Act. I find that though the applicants have their independent shares apart from the shares belonging to the estate of the said deceased, but still then they have not initiated any proceeding challenging the decision of the Board of Directors which is under the scrutiny of this Court in the present proceeding and/or for removal of the Board of Directors for taking step which according to the applicants may ultimately destroy the business of the B.C.L resulting disastrous consequences being brought in the assets of the company. Thus, when on the contrary, I find that by virtue of the power enjoyed by the Board of Directors of B.C.L, decision for expanding its business by taking over four cement manufacturing units of Reliance Infrastructure has been taken and further since such power of taking such decision of the Board of Directors is not controlled by the power of control to be exercised by the promoters and further since no complaint is forthcoming for any quarter that the business of B.C.L will be ruined if the decision of the Board of Directors is implemented resulting fall in its share price, I hold that the testamentary Court, while in seisin of the probate proceeding, cannot pass any direction encroaching upon the jurisdiction of the Board of Directors for taking over four cement manufacturing units of Reliance Infrastructure by purchasing its shares. This conclusion is drawn by this court as I hold that for implementation of such decision of the Board of Directors approval of the promoters having control over the management of the business of the said company, is not necessary. In the aforesaid set of facts this court holds that B.C.L need not be served with any notice relating to this application for examining its business prospect arising out of the proposed taking over of the four cement manufacturing units of Reliance Infrastructure by purchasing its shares. I, however, make it clear that in the event, the shareholders have any complaint and/or grievance, the shareholders can ventilate their grievances before appropriate forum such as Company Law Board etc. They may also initiate process of removal of Directors by following the provisions of the Companies Act. However, such power could have been exercised by the “APL”., had the “APL”. remained operative. In my considered view since Mrs. Birla had some share in B.C.L and on her death her share became a part of her estate and further since “APL”. has already got its name registered in respect of those shares, the right which Mrs. Birla could have exercised by virtue of her shareholding in the said company during her lifetime, could have been exercised by “APL”., had it remained functional till date. Since the “APL”. has now became non-functional, no such step can be taken by “APL”. either for protecting the shareholding interest belonging to the estate of the deceased or for exercising the power of control over M.P. Birla Group of company which is also an asset belonging to the estate of deceased in accordance with the provisions of the Companies Act. I am informed that the application filed by the applicants for making “APL”. functional is awaiting consideration before the Appeal court. In my view the parties should approach the Appeal Court for making the “APL”. functional immediately, so that “APL”. can exercise its power of control over the management of the B.C.L by following the provisions prescribed under the Companies Act and in case the “APL”. fails to discharge its duty, Probate Court can pass necessary direction upon “APL”. for taking steps in accordance with law, whenever such direction needs to be passed for preserving the estate of the deceased. Think about the practical difficulty which the Probate Court may face in case the “APL”. is allowed to remain non-functional, as even in cases where the Probate Court will feel necessary to pass any direction for preservation of the estate of the deceased, can the Probate Court pass any direction and/or implement its decision without “APL”. being made functional?. Say for example, if the Court finds that steps are required to be taken for removal of the Directors, can the Probate Court itself representing the shareholder, take such steps by calling a extraordinary General Meeting for the said purpose?. Then again, if initiation of any proceeding before the Company Law Board or Court is found to be necessary for protecting the estate of the deceased, can the Probate Court itself initiate such proceeding?. Then again, if it found that somebody has trespassed in any of the properties belonging to the estate of the deceased, can the Probate Court pass a decree for eviction against such trespassers by adjudicating the rival claims of the parties over title in the said property?. Many other instances can be given where the Probate Court will feel helpless in passing appropriate order and in implementation thereof by itself, even if the Probate Court finds that such order should not only be passed but also should be implemented for preservation of the estate of the deceased. In my view, if any order is passed by the Probate Court for preserving the estate of the deceased, such order can only be executed through the agent of the Probate Court i.e., “APL”.. As such “APL”. should be made functional immediately to protect and preserve the estate of the deceased so far as the shareholding interest of Mrs. Birla and her controlling power over the M.P Groups of Companies which are most precious assets of the estate of the deceased are concerned. In my view, in case any circumstance as aforesaid arises where intervention of the Court is necessary for preserving the estate of the deceased, the Probate Court at best can pass necessary direction upon “APL”. to initiate appropriate proceeding before appropriate forum for seeking appropriate reliefs in accordance with law and it is only that appropriate forum which in my view, can pass appropriate order after adjudicating the rights of the parties including that of the stranger. Let me now consider the other rival contentions of the parties advanced before me. A serious question was raised by Mr. Mitra, learned Senior counsel relating to maintainability of this application. He submitted that if it is found that the relief which is claimed by the applicants cannot be granted by this Court then the Court should refuse to entertain the application by holding that the Court has no jurisdiction to entertain the application. In fact, this is a very important question which is raised by Mr. Mitra before this Court. To elaborate this contention Mr. Mitra, learned Senior counsel argued that can any court pass any injunction order against any person who is not a party to the proceeding. To substantiate his aforesaid contention Mr. Mitra has cited the following decision of different High Courts in the case of K.P.M Aboobucker Vs. V.K. Kunhamoo & Ors. reported in 1958 Madras 287, in the case of Bharat Petroleum Corporation Ltd. Vs. Hari Chand Sachdeva & Ors reported in 2001 Delhi 307, in the case of Varghese Vs. Fast Line Builders & Developers Kerala Pvt. reported in 2013(2) KLJ695 in the case of Laxmidas Morarji Vs. Behrose Darab Madan reported in 2009(10) SCC425 It was unanimously held by High Courts as well as by the Hon’ble Supreme Court in the aforesaid decisions that when a person against whom the injunction order is sought for is not a party to the suit, no relief can be granted in the suit itself. Mr. P Chidambaram, learned Counsel appearing for the applicants, however, refuted such submission of Mr. Mitra by contending that the Probate Court’s jurisdiction to pass appropriate injunction order to protect the estate of the deceased is well-recognized by this Court as well as by the other High Courts. To substantiate his aforesaid submission he has relied upon the following decisions:- (i) In the case of Nerodebarani Debi Vs. Chamatkarin Devya reported in AIR1915Calcutta 565, (ii) In the case of Atula Bala Dasi Vs. Nirupama Devi reported in AIR1951Calcutta 561, (iii) In the case of Amarendra Dhwaj Sing & Anr. Vs. Prem Kumar Singh and Ors. Reported in 2013(1) PLJR853 (iv) In the case of Sri Karmajit Jaiswal Vs. Investec Trust (Jersey) Limited & Ors. Reported in 180 (2011) DLT15 Relying upon the aforesaid decision of different High Courts Mr. Chidambaram, Learned Senior Counsel submitted that the Probate Court has the jurisdiction to pass interim order of injunction though such power cannot be exercised under Order 39 rules 1 and 2 of the Code of Civil Procedure but such power can be exercised by the Court under its inherent jurisdiction under Section 151 of the Code of Civil Procedure. By referring to the judgment of the Delhi High Court in the case of Sri Karmajit Jaiswal Vs. Investec Trust (Jersey) Limited & Ors. (supra) Mr. Chidambaram submitted even the Court’s power to grant injunction against third party is recognized by the Delhi High Court in the said decision. Let me now consider the submission made by the learned Counsel appearing for the parties and the decision cited at the bar. I have perused all the decision cited by learned Counsel appearing for the parties and the decision cited by the learned Counsel appearing for the respective parties as referred to above very minutely. On perusal of those judgments passed by different High Courts, I have no hesitation to hold that the Probate Court has jurisdiction to pass interim order of injunction in exercise of its inherent jurisdiction in appropriate cases where the Probate Court finds that pending appointment of an administrator pendente lite there is any chance of the asset of the deceased being dissipated. In all these decisions, I find injunction was granted by the Probate Court against parties to the proceeding. Even the Delhi High Court decision which was relied upon by Mr. Chidambaram to demonstrate that injunction can also be passed against a third party, in my view, is not the correct reading of the said judgment, by Mr. Chidambaram. On perusal of the facts of the said case it appears to me that injunction was granted against a party to the proceeding who was the objector in the probate proceeding. The objector was not a stranger to the probate proceeding. As such the said decision cannot be accepted as a judgment lying down the proposition of law that Probate Court can pass an injunction against a stranger. Borrowing the principles of law laid down in the decisions cited by Mr. Mitra, this Court has no hesitation to hold that the Probate Court cannot pass any injunction order against a third party as third party who has no caveatable interest in the probate proceeding cannot be allowed to be added as party in the probate proceeding and also for the reason that no order can be passed effecting the right of the stranger without adjudicating his right and adjudication of his rights in the probate proceeding is impossible as Probate Court cannot decide any foreign issue unconnected with the probate proceeding. I respectfully agree with the submission of Mr. Mitra, learned Senior Counsel appearing for the plaintiffs/ Lodhas that Probate Court cannot pass any injunction order against any person who is not a party to the proceeding. However, without discussing the other contention of Mr. Chidambaram I cannot arrive at this ultimate conclusion. It was also argued before me that injunction has not only been prayed for in this application against the Birla Corporation Limited but injunction has also been prayed for against one of the plaintiffs, namely, Harsh Vardhan Lodha who is a party to the said proceeding before the Probate Court. According to the applicants, Probate Court can pass interim order of injunction against Harsh Vardhan Lodha who is a party to the proceeding, if passing of such injunction is deem fit and proper in the present case. Let me now consider this part of the submission of Mr. P. Chidambaram, learned Senior Counsel. In the present case we find that Harsh Vardhan Lodha has dual capacity. He is a party to the probate proceeding as he is one of the plaintiffs in the Probate Suit. He is an applicant for the grant of letter of administration as a legatee under the Will. He has another capacity i.e., he is Chairman of the Board of Directors of B.C.L. His capacity as a Chairman of the Board of Director in B.C.L cannot be mixed up with his capacity as legatee under the Will. In this connection a question will crop up as to whether the direction which was sought for by way of injunction against Harsh Vardhan Lodha, can be passed against Harsh Vardhan Lodha as a legatee under the Will. Answer is No.Since Harsh Vardhan Lodha is not a party in his capacity as a Chairman of the Board of Director of B.C.L, no direction can be passed against Harsh Vardhan Lodha in the capacity of he being a Chairman of the Board of Directors of the said company. As such I hold that no direction can be passed either for production of the relevant documents relating to the proposed deal by Harsh Vardhan Lodha as a legatee under the Will nor any injunction order can be passed against Harsh Vardhan Lodha in his capacity of Chairman of Board of Directors of the said company. Though it is true that Harsh Vardhan Lodha became the Chairman of Board of Directors of the said company by virtue of his interest flowing from the will but still then his position that of a Chairman of Board of Directors of the said company cannot be linked up with his position as a legatee under the said Will. The decision taken by the Board of Directors, as I have already held, cannot be a subject matter of scrutiny by the Probate Court. I agree with the decision of Kerala High Court in the case of Cochin Malabar Estate and Industries Ltd. & Anr. Vs. P.V. Abdul Khader & Anr. (supra) wherein it was held that even the Company Court cannot interfere with the dayto-day business management of the company. Following the said principle I hold that Probate Court cannot regulate the day-to day business policy of the company. Thus, I hold that the Probate Court has no jurisdiction to entertain this application as the reliefs prayed for in this application cannot be granted by the Probate Court under Indian Successions Act. This conclusion is drawn by me by following the decision of the Hon’ble Supreme Court in the case of official Trustee West Bengal Vs. Sachindra reported in AIR1969SC823wherein wherein the Hon’ble Supreme Court while discussing the issue relating to the jurisdiction of the Court to decide an issue approved the full Bench decision of this Court in Hirday Nath Roy Vs. Ramchandra Barua Sharma reported in ILR48CAL138 The Full Bench of this Hon’ble Court dealt with the question as to what is meant by jurisdiction?. It was held therein that before a court can be held to have jurisdiction to decide a particular matter it must not only have jurisdiction to try the suit brought but must also have the authority to pass the order sought for. It was also held therein that it is not sufficient that it has some jurisdiction in relation to subject matter of the suit. The Full Bench further held that in order to hold that the Court has jurisdiction to decide an issue its jurisdiction must include the power to hear and decide the questions at issue. The authority to hear and decide the particular controversy that has arisen between the parties or in other words what is relevant is whether the Court had the power to grant the relief asked for in the application filed by the applicant. If it is held that the learned judge had competence to pronounce a judgment on an issue presented before him for his decision then the fact that he decided that issue illegally or incorrectly is wholly besides the point. Before parting with, this Court also likes to consider the submission of the learned Counsel of the respective parties with regard to the admissibility of the newspaper reportings on which the foundation of this application rests. Several decisions have been cited by Mr. Mitra, Learned Senior Counsel, to demonstrate that newspaper reportings reportings per se are hear say evidence and as such, newspaper are not admissible and since the reliefs claimed in this application are based on newspaper reprotings only, the Court should dismiss the said application as it does not disclose any cause of action. The legal position in this regard is very clear. It has been decided by the Hon’ble Supreme Court in the decision cited by Mr. Mitra that the newspaper reportings are not admissible as such, reportings are published on the basis of hear say evidence. It was held by the Hon’ble Supreme Court that the newspaper reporting per se is not admissible. However, such newspaper reportings can be admitted into evidence if such reportings are supported by an affidavit by the reporter. If the application is considered in the light of the aforesaid decisions of the Hon’ble Supreme Court then it can be held that the cause of action for filing the present application is primarily based on the newspaper reportings which are inadmissible in evidence. However, since an objection was raised as to the admissibility of such newspaper reporting, the applicants filed a supplementary affidavit after taking leave of this Court enclosing therewith statutory notices issued by the B.C.L where negotiation of B.C.L with Reliance Infrastructure for taking over its four cement manufacturing units partly by utilizing its own fund and partly by borrowing money, is apparent. Though an application was taken out by the plaintiffs i.e., Lodhas for recall of the leave granted to the applicants for filing the said supplementary affidavit, but subsequently in course of hearing of this application they did not press their said application and, in fact, they also relied upon certain documents annexed to the said supplementary affidavit. As such, if the averment made in the application is read conjointly with the statements made part of these in the supplementary affidavit which were made applications, this Court cannot hold that the application is devoided on any cause of action. That apart I find much substance in the contention of Mr. P. Chidambaram, learned Senior Counsel that at the stage of considering the demurrer of this application, the party objecting to the maintainability of such application should demonstrate before the Court that the application is not entertainable by the Court even by accepting all the statements made in the said application as true and correct. Thus, I cannot agree with the submission of Mr. Mitra, learned Senior Counsel, that the applications are devoided of any cause of action. To conclude, I hold that since the decision of the Board of Directors in taking over four cement manufacturing units of Reliance Infrastructure is not subject to the control of the promoters’ controlling power over the management of the said company and further since the Probate Court cannot pass any direction and/or injunction order against any person who is not a party to the probate proceeding and further since no adjudication of a foreign issue is possible before the Probate Court in the absence of any party who has no caveatable interest in the probate proceeding, this Court holds that the reliefs claimed by the applicants in these applications, cannot be granted. The applications are thus, rejected with the observation that the estate of the deceased cannot be left uncontrolled and since the “APL”. has now become defunct, the parties may approach before the appropriate forum for making such “APL”. functional so that whenever the Probate Court feels necessary, the probate Court can pass appropriate direction upon the “APL”. for safeguarding and/or protecting the estate of the deceased. All the applications filed by the defendants and the demurrer applications filed by the plaintiffs are, thus, disposed of with the above observation. Urgent photostat certified copy of this order, if applied for, be given to he learned advocate of the parties. (Jyotirmay Bhattacharya,J)