Judgment 1. THIS appeal is at the instance of some of the share-holders of the Asansol Electric Supply Co. Ltd. (hereinafter referred to as the Company)and it arises out of a suit instituted by re appellants who were the plaintiffs against the Directors and. one Jaydev Daw, the son of the Managing Director of the Company and the Company as defendants, inter alia, for certain declarations and for permanent injunction. The suit was brought by the appellants as shareholders on behalf of themselves and as representing the other share-holders of the Company, under Order 1, Rule 8 of the Code of Civil Procedure. 2. THE company is a private limited company incorporated under the Companies act, 1956 (hereinafter referred to as the Act. The object of the company is to supply electricity in the town of Asansol and its suburbs as specified in clause (3) of the Memorandum of Association. The company is the holder of a licence granted under the Indian Electricity Act. The subscribed and paid up share capital of the company is Rs. 2,10,000/- divided into 21,000 ordinary shares of Rs. 10/- each, and Rs. 40,000/- divided into 4,000 preference shares of Rs. 10/- each, The respective shares which are held by the plaintiffs share-holders are 3. 983 ordinary shares and 500 preference share. The plaintiffs between themselves hold more than 10 per cent of the total paid up share capital of the company who was the defendant No. 1 in the suit. The defendant No. 2 Sanatan daw is the Managing Director of the Company and the defendant No. 7, Joydey Daw is the son of the defendant No. 2. The dispute between the parties is with regard to the appointment of the defendant No. 7 as the chief Accountant of the Company. The defendant No. 7, Joydev Daw was appointed as the Chief Accountant of the Company on and from June 25, 1960. As the defendant No. 7 is the son of the Managing Director, the defendant no. 2, and the total remuneration of the defendant No. 7 was fixed at Rs. 500/-, a special resolution of the general members according sanction to the appointment of the defendant No. 7 was required under Section 314 (1) of the Act. As the defendant No. 7 is the son of the Managing Director, the defendant no. 2, and the total remuneration of the defendant No. 7 was fixed at Rs. 500/-, a special resolution of the general members according sanction to the appointment of the defendant No. 7 was required under Section 314 (1) of the Act. In terms of the provisions of section 314 (1) of the Act, a special resolution was passed in an Extraordinary general Meeting of the company held on June 25, 1960. By the said special resolution the appointment of the defendant No. 7 Joydev Daw as the chief Accountant of the company on a basic pay of Rs. 350/- and dearness allowance of Rs. 150/- only per month as a permanent incumbent with effect from June 25, 1960, was sanctioned. The plaintiffs do not dispute the initial appointment of the defendant No. 7 as accorded by the said special resolution of the company as legal and valid. 3. THE defendant No. 7 was granted increment of his basic pay by Rs. 101/- and dearness allowance by Rs. 5/-from April 1, 1961. In 1962 he was given an increment of Rs. 10/- in the basic pay and a further increment of Rs. 10/- in the basic pay and Rs. 5/- as dearness allowance from April 1, 1962. These increments in the basic pay and the dearness allowance were given to the defendant No. 7 as a result of general increments to all employees of the company. From July 1, 1962, the defendant No. 7 was given a further increment of Rs. 100/ - in his basic pay. On September 12, 1962, a resolution was passed by the Board of Directors increasing the remuneration of the defendant No. 7 to Rs. 500/ - as basic pay and Rs. 200/- as dearness allowance with annual increment of Rs. 50/- up to Rs. 1,000/- as basic pay per month along with other usual allowances and amenities. Before these increments which were granted to the defendant no. 7 from time to time no special resolution was passed by the company in general meeting of the share-holders according sanction prior to the granting of the said increments to the defendant no. 7. 1,000/- as basic pay per month along with other usual allowances and amenities. Before these increments which were granted to the defendant no. 7 from time to time no special resolution was passed by the company in general meeting of the share-holders according sanction prior to the granting of the said increments to the defendant no. 7. The contention of the plaintiff is that before giving any increment to the defendant No. 7 a prior sanction by the general members of the company was required in terms of Section 314 of the Act. According to the plaintiffs each increment granted to the defendant no. 7 including the increment which was sanctioned by the resolution dated September 12, 1962, of the board of Directors of the company was tantamount to a subsequent appointment of the defendant No. 7 within the meaning of the Explanation to Section 314. 4. ON October 22, 1962, for the purpose of regularising the said subsequent appointments a special resolution was passed in the Extraordinary General Meeting of the share-holders and the increments which were granted to the defendant No. 7 were approved of by the Company in the general meeting. The plaintiffs have also challenged this resolution dated October 22, 1962, as illegal, invalid and void. Further the managing Director having violated the provisions of Section 314 of the Act by giving subsequent appointments to his son, the defendant No. 7 without the prior sanction of the general members of the company, the Managing Director and his son defendant No. 7 should be deemed to have vacated their respective offices with effect from the first of such subsequent appointments, that is, from April 1, 1961. On the aforesaid allegations the plaintiffs prayed for the following reliefs in the plaint- a) Leave under Order 1 Rule 8 of the C. P. C. b) Leave under Order 2 Rule 2 of the C. P. C. c) Declaration that the defendant no. On the aforesaid allegations the plaintiffs prayed for the following reliefs in the plaint- a) Leave under Order 1 Rule 8 of the C. P. C. b) Leave under Order 2 Rule 2 of the C. P. C. c) Declaration that the defendant no. 2 has vacated his office and or is to be deemed to have vacated his office of Managing Director and Director of the defendant company as from 1st April 1961 or 1st April 1962 or 1st July 1962 and/or has ceased to be the Managing director or Director as from the said dates; d) Declaration that the purported special Resolution passed at the extraordinary General Meeting of the defendant company held on 22nd October, 1962 is invalid, void and of no effect whatsoever; e) Declaration that the defendant no. 7 has vacated his office and/or is deemed to have vacated his office and or has ceased to hold any office on or the defendant company on and from 1st April 1961 or 1st April 1962 or 1st July 1962. f) Perpetual injunction restraining the defendant No. 2 from acting as Managing director or Director of the defendant company and restraining the defendant No. 7 from holding the office of or acting as Chief Accountant or holding any other office or acting as an officer or employee of the defendant company. g) Enquiry into salaries, allowances, bonus, commission, other emoluments and the money equivalent of perquisites received by the defendant no. 2 from the defendant company with effect from 1st April 1961 or 1st April 1962 or 1st July 1962 and a decree in favour of the defendant company for such sum of money as may be due from the defendant No. 2 to the defendant company on the taking of. such accounts. h) Enquiry into salaries, allowances, bonus, commission, other emoluments and the many equivalent of perquisites and advantages received by the defendant No. 7 from the defendant company with ' effect from 1st April 1961 or 1st April 1962 or 1st July 1962 and a decree in favour of the defendant company for such sum of money as may be found due from the defendant no. 7 on the taking of such accounts. 7 on the taking of such accounts. i) Injunction restraining the defendant from holding the Thirtieth Annual general Meeting of the company which is due to be held on the 23rd September 1963 and from passing the Resolutions mentioned in paragraph thereof or resolutions similar thereto and in any event, from giving effect to any resolution, if passed at the said meeting. j) An injunction restraining the defendant No. 2 from participating in the meetings of the Board of Directors or acting as the Chairman thereof. k) Receiver. l) Costs. The defendants Nos. 2 and 7 contested the suit by filing written statements. It was contended by them there had been no violation of Section 314 of the Act; that the suit was not maintainable by the plaintiffs and that the Civil Court had no jurisdiction to try the suit. 5. THE learned Subordinate Judge came to the conclusion that the suit was maintainable; that the Civil Court had jurisdiction to entertain and hear the suit. The learned Subordinate Judge also came to the finding that there was no violation of the provisions of Section 314 of the Act. In that view of the matter the learned Subordinate Judge dismissed the plaintiffs' suit. 6. ON appeal by the plaintiffs, the learned Additional District Judge was of the view that the defendants Nos. 1 and 7 had violated the provisions of section 314 of the Act. The learned additional District Judge held that each subsequent increment that was granted to the defendant No. 7 was tantamount to a subsequent appointment within the meaning of the Explanation to Section 314 and that such subsequent appointments having been made without the prior consent of the company in general meeting, both the defendants Nos. 2 and 7 should be deemed to have vacated their respective offices with effect from April, 1961. He also came to the findings that the suit was maintainable and that the court had jurisdiction to entertain and hear the suit. Upon the aforesaid findings the learned Additional District Judge decreed the plaintiffs' suit. Hence this appeal by the defendants. 2 and 7 should be deemed to have vacated their respective offices with effect from April, 1961. He also came to the findings that the suit was maintainable and that the court had jurisdiction to entertain and hear the suit. Upon the aforesaid findings the learned Additional District Judge decreed the plaintiffs' suit. Hence this appeal by the defendants. Two principal questions are involved in this appeal: the first question is whether the civil court had jurisdiction to try such a suit and the second question is whether on a proper construction of the Explanation to Section 314 (1) of the Act it can be said that the increments granted to the defendant no. 7, Jaydev Daw, were subsequent appointments within the meaning of the Explanation. 7. IT was contended by Mr. Banerjee, learned Counsel for the defendants-appellants that it was an established principle of law that the civil court had no jurisdiction to interfere with the internal management of the company acting within its powers. Counsel contended that, in any event, the jurisdiction of the civil court had been taken away by the provisions of the Act. On the Second question Mr. Banerjee submitted that the provisions of the Explanation to Section 314 (1) did not contemplate that increments in pay would mean subsequent appointments. 8. THE leading case on the question of the court's jurisdiction to interfere with the internal management of a company is (1) Foss v. Harbottle, 67 Cr 189. It has been ruled in that case that a court will not interfere with the ordinary management of a company acting within its power and that it has no jurisdiction to do so at the instance of the share-holders. Later judicial decisions, however, made certain exceptions to the rule in (1) Foss v. Harbottle. Difficulty has been felt where the acts of the majority of the share holders having controlling interest in the company are prejudicial to the interest of the minority share-holders of the company. If the rule in (1) Foss v. Harbottle is applied, the minority share-holders will have no relief in ordinary courts of law. There can be no doubt that in ordinary cases the will of the majority of the share-holders will get supremacy by the application of the rule in (1) Foss v. Harbottle. If the rule in (1) Foss v. Harbottle is applied, the minority share-holders will have no relief in ordinary courts of law. There can be no doubt that in ordinary cases the will of the majority of the share-holders will get supremacy by the application of the rule in (1) Foss v. Harbottle. The majority can always set right a thing which was done by the minority either illegally or irregularly, if the thing complained of was one which the majority of the share-holders were entitled to do legally and was within the powers of the company, by calling a fresh meeting. In such cases, the court will refuse to interfere at the instance of a share-holder even in a suit brought in a representative capacity. But, the question is, if the majority acts in an oppressive manner or does an act which is ultra vires the company, whether the minority has any remedy against the same. There is no difference of opinion that a suit at the instance of the Company is always maintainable, but if the majority of the share-holders act illegally, they will not permit the minority share-holders to use the name of the company for any suit for the purpose of correcting the illegal acts done by the majority or for any other relief against them. In (2) Stroud v. Lawson and ors. 1898 2 Q. B. 44, the plaintiff, a shareholder sued the directors of the company on behalf of himself and all other share-holders in the company, on the ground that the defendants other than the company declared and paid a dividend on the shares of the company out of capital, which was ultra vires, and he claimed that they should put back the money which was so paid, not into his own pocket, but into the cofiers of the company for the benefit of the share-holders as a body. In that case, the plaintiff also on his own behalf claimed against the directors for having induced him to become a shareholder of the company by various false allegations. The suit was, however, dismissed on the ground of mis-joinder of causes of action. It was held that the two causes of action were distinct and could not be joined in one action. Under the decision of that case the suit would have been maintainable for either of the said reliefs. The suit was, however, dismissed on the ground of mis-joinder of causes of action. It was held that the two causes of action were distinct and could not be joined in one action. Under the decision of that case the suit would have been maintainable for either of the said reliefs. It follows from that decision that a share-holder can sue the directors of the company impleading the company as a party defendant, for himself and on behalf of the share-holders for any act of the directors or the majority of the shareholders, which is ultra vires the company. In (3) Baillie v. Oriental Telephone and Electric Co. Ltd. 1915 1 Ch. 503, the court of appeal held that an action by a share-holder on behalf off himself and all other share-holders of the company for a declaration that certain resolutions were not binding on the ground of insufficient notice of the meeting at which they were passed, and for an injunction to restrain the company and the directors from acting upon them was maintainable on the ground that the resolutions were invalid and not binding upon the company. The law on the point has been clearly laid down in a recent decision of the court of appeal in (4) Edwards y. Halliwell, 1950 2 All. ER 1064. In that, case, it, has been held by Jenkins, l. J. that the cases falling within the general ambit of the rule in (1) Foss v. Harbottle are subject to certain exceptions, namely, (1) where the act complained of is wholly ultra vires the company or association, (2) when the act complained of is one which can validly be done or sanctioned, not by a simple majority of the members of the company or association, but only by some special majority, and (3) when the individual members sue not in the right of the company but in their own right to protect from invasion their own individual rights as members. 9. THE exception which has been made to the rule in (1) Foss v. Harbottle in the English decisions referred to above has been adopted by the courts in India. In (5) Ramkissendas Dhanuka and ors. 9. THE exception which has been made to the rule in (1) Foss v. Harbottle in the English decisions referred to above has been adopted by the courts in India. In (5) Ramkissendas Dhanuka and ors. v. Satya Charan Law 50 CWN 310, it has been held that the principle that the court will not generally interfere with the internal affairs of a company except at the instance of the majority of the share-holders, is applicable only where the act complained of is merely irregular and not when it is ultra vires. The decision in Dhanuka's case has been approved by the Privy council in an appeal from the decision in that case (See AIR 1950 Privy council 80.) 10. IT is now an accepted principle of law that where an act by the majority of the share-holders is merely irregular and can be rectified by the majority of the share-holders, an action is not maintainable against that act, but if the act is ultra vires the company itself and is beyond the powers of the members of the company or its shareholders to ratify that act or to rectify the same, an individual member of the company may sue the company and its directors, for himself and on behalf of the other share-holders for declaring that act as illegal and for consequential reliefs. In such actions, however, the plaintiff has no larger right to relief than the company would have as plaintiff. Some other English decisions were cited at the Bar. We, however, prefer to refer to the following passage from Halsbury's Laws of England (3rd ed. Vol. 6, page 418, paragraph 810)which contains a summary of the Jaw on the point : - "the court has no jurisdiction to interfere with the internal management of companies acting within their powers. To redress a wrong done to the company or to recover money or damages due to it the action must prime facie be brought by the company itself, if the matter constituting the cause of action is a cause of action properly belonging to the company or the general body of members. To redress a wrong done to the company or to recover money or damages due to it the action must prime facie be brought by the company itself, if the matter constituting the cause of action is a cause of action properly belonging to the company or the general body of members. Where, however, the persons against whom relief is sought hold and control the majority of shares, and will not permit an action to be brought in the company's name, shareholders complaining may bring an action in their own names and on behalf of the others and they may do so also where the effect of preventing them so suing would be to enable a company by an ordinary resolution to ratify an improperly passed resolution. In such an action the plaintiffs have no larger right to relief than the company would have; they cannot complain of acts which are valid if done with the approval of the majority of share-holders, or are capable of being confirmed by the majority, and can only maintain their action when the acts complained of are of a fraudulent character or are ultra vires the company, mere irregularity or informality which can be remedied by the majority being insufficient. . . . . . . . . . . " 11. VIEWED from the above principle of law the instant suit must be held to be maintainable. Mr. Banerjee. however, submitted that the Act expressly excluded the jurisdiction of the civil court to try the instant suit and that accordingly, in view of Section 9 of the code of Civil Procedure, the suit was mot maintainable. . . . " 11. VIEWED from the above principle of law the instant suit must be held to be maintainable. Mr. Banerjee. however, submitted that the Act expressly excluded the jurisdiction of the civil court to try the instant suit and that accordingly, in view of Section 9 of the code of Civil Procedure, the suit was mot maintainable. He referred to the provisions of Section 2 (11) and section 10 of the Act which are as follows : 2 (11) -The court means :- (a) with respect to any matter relating to a company (other than any defence against this Act), the court having jurisdiction under this Act with respect to that matter relating to that company, as provided in Section 10; (b) with respect to any offense against this Act, the court of a Magistrate of the First Class or, as the court may be, a Presidency Magistrate, having jurisdiction to try such offence; 10.-Jurisdiction of courts- (1) the court having jurisdiction under this Act shall be- (a) the High Court having jurisdiction in relation to the place at which the registered office of the company concerned is situate, except to the extent to which jurisdiction has been conferred on, any District Court or District courts subordinate to that High Court in pursuance of sub-section (2); and (b) where jurisdiction has been so conferred, the District Court in regard to matters falling within the scope of the jurisdiction conferred, in respect of companies having their registered offices in the district. (2) The Central Government may, by notification in the Official Gazette and subject to such restrictions, limitations and conditions as it thinks fit, empower any District Court to exercise all or any of the jurisdiction conferred by this Act upon the Court, not being the jurisdiction conferred- (a) in respect of the companies generally, by Sections 231, 391, 394, 395 and 397 to 407, both inclusive. (b) in respect of the companies with a paid-up share capital of not less than one lakh of rupees, by Part VII (sections 425 to 560) and the other provisions of this Act relating to the winding up of companies. (3) For the purposes of jurisdiction to wind up companies, the expression "registered office" means the place which has longest been the registered office of the company during the six months immediately preceding the presentation of the petition for winding up. (3) For the purposes of jurisdiction to wind up companies, the expression "registered office" means the place which has longest been the registered office of the company during the six months immediately preceding the presentation of the petition for winding up. 12. SECTION 2 (11) is the definition section of the words "the court". Therefore, whenever the words "the court" are mentioned in the provisions of the act, the same will mean the court having jurisdiction under the Act with respect to that matter relating to a company as provided in Section 10. Section 10 refers to the High Court as the court having jurisdiction, under the act. The cumulative effect of Section 2 (11) and Section 10 is that the expression "the court" occurring in any provision of the Act will mean the high Court. It does not mean that in all matters the High Court will have jurisdiction and the civil court will not have jurisdiction in respect of any matter relating to a company. The expression "the court" has been used in various provisions of the Act. Those provisions undoubtedly mean and refer to the High Court. It is not possible to refer to all the provisions in which the expression "the court" has been used, but a few of the said provisions may be mentioned. Section 17 of the Act provides for special resolution and confirmation by the court required for alteration of memorandum. Sub-section (2) of Section 17 provides that "the alteration shall not take effect until, and except in so far as, it is confirmed by the Court on petition". Sub-section (2)by referring to the expression "the court" means the High Court. Similarly sub-sections (3), (4), (5) and (7) of section 17 having used the expression "the court", mean the High Court. Subsections (1) and (4) of section 18 also refer to the expression "the court". In view of the definition of the expression, it means the High Court. The expression "the court" has been used in sections 101, 102, 107, 141, 155, 243 and many other sections. Therefore, all these provisions in which the expression "the court" has been used, the rights or obligations provided by the said provisions will have to be enforced in accordance with the said provisions, in the High Court which will have exclusive jurisdiction in the matter. Therefore, all these provisions in which the expression "the court" has been used, the rights or obligations provided by the said provisions will have to be enforced in accordance with the said provisions, in the High Court which will have exclusive jurisdiction in the matter. In respect of other provisions creating rights or obligations, but without referring to the expression "the court" for the enforcement of such rights and obligations, it cannot be said that such rights or obligations can only be enforced in the High Court, or in other words, it cannot be said that the High court will be the only court having jurisdiction to deal with any matter provided for in those other provisions. Mr. Banerjee relied upon a decision of the Madhya Pradesh High,1 court in (6) Nava Samaj Ltd., Nagpur v. Civil Judge, Class I, Rajnandgaon, air 1966 M. P. 286. It has been held in that case that the provisions of section 2 (11) and Section 10 of the Act, exclude the jurisdiction of other courts in regard to matters covered by the Act. With great respect, we are unable to agree with the said decision of the Madhya Pradesh High Court. In our view, on a proper construction of the provisions of Section 2 (11) and Section 10, it must be held that the Act does not altogether exclude the jurisdiction of the civil court. As already stated above, when any provision of the act requires that any action has to be taken in "the court" in that case only the jurisdiction of the civil court will be barred and the High Court will alone have jurisdiction. 13. MR. Banerjee then relied upon the well-known principle that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of (See (7) Wolverhampton New Water Works co. v. Hawkesiord, 1859 6 CB (NS) 336; (8) Ponnuswami v. Returning Officer, namakkal Constituency, AIR 1952 SC 64 ; (5) Ramkissendas Dhanuka and ors. v. Satya Charan Law, 50 CWN 310, according to Mr. v. Hawkesiord, 1859 6 CB (NS) 336; (8) Ponnuswami v. Returning Officer, namakkal Constituency, AIR 1952 SC 64 ; (5) Ramkissendas Dhanuka and ors. v. Satya Charan Law, 50 CWN 310, according to Mr. Banerjee the provisions of Section 314 create a special obligation, namely, by requiring prior consent of the general members before a director or the partner or relative of a director is appointed to any office or place of profit carrying a total monthly remuneration of five hundred rupees or more. Sub-section (2) of Section 314 provides that if any office or place of profit is held in contravention of the provisions of sub-section (1), the director concerned shall be deemed to have vacated his office as director with effect from the first day on which contravention occurs, and shall also be liable to refund to the company the remuneration received, or the monetary equivalent of any perquisite or advantage enjoyed by him, in respect of such office or place of profit. We fully agree with Mr. Banerjee that Section 314 creates a special obligation and also contains a penal provision in case the provision of sub-section (1) is violated. But the question is whether the Act provides for any remedy against the violation of the provision of Section 314, or in other words for the enforcement of the penal provision. In case there be any provision for the enforcement of the penal provision, there will be no doubt the remedy provided for in such a provision has to be availed of. According to Mr. Banerjee such a remedy has been provided for in sections 397 and 398 of the Act. Before we proceed further we may quote below the provisions of Section 314, 397, 398 and 399 of the Act. "314. Director etc. According to Mr. Banerjee such a remedy has been provided for in sections 397 and 398 of the Act. Before we proceed further we may quote below the provisions of Section 314, 397, 398 and 399 of the Act. "314. Director etc. not to hold office or place of profit- (1) Except with the previous consent of the company accorded by a special resolution,- (a) no director of a company shall hold any office or place of profit, and (b) no partner or relative of such a director, no firm in which such a director or relative is a partner, no private company of which such a director is a director or member, and no director, managing agent, secretaries and treasurers, or manager of such a private company shall hold any office or place of profit carrying a total monthly remuneration of five hundred rupees or more, except that of managing director, managing agent, secretaries and treasurers, manager, legal or technical adviser, banker or trustee for the holders of debentures of the company. (i) under the company; or (ii) under any subsidiary of the company, unless the remuneration received from such subsidiary in respect of such office or place of profit is paid over to the company or its holding company: provided that where a relative of a director or a firm in which such relative is a partner, is appointed to an office or place of profit under the company or a subsidiary thereof without the knowledge of the director, the consent of the company may be obtained within three months from the date of the appointment; and if such consent is not obtained within that period or is refused, the relative or the firm shall be deemed to have vacated his or its office or place on and from the date of expiry of that period and shall be liable to refund to the company any remuneration drawn by him or it for the period immediately preceding that date. Explanation.-For the purpose of this sub-section, a special resolution according consent shall be necessary for every appointment in the first instance to an office or place of profit and to every subsequent appointment to such office or place of profit on a higher remuneration not covered by the special resolution except where an appointment on a time scale has already been approved by the special resolution. (1a) Nothing in sub-section (1)shall apply where a relative of a director or a firm in which such relative is a partner holds any office or place of profit under the company or a subsidiary thereof having been appointed to such office or place before such director becomes a director of the company. (2) If any office or place of profit under the company or a subsidiary thereof is held in contravention of the provision of sub-section (1), the director concerned shall be deemed to have vacated his office as director with effect from the first day on which the contravention occurs; and shall also be liable to refund to the company any remuneration received, or the monetary equivalent of any perquisites or advantage enjoyed by him, in respect of such office or place of profit. "(2a) Every individual, firm private company or other body corporate proposed to be appointed to any office or place of profit to which this section applies shall, before or at the time of such appointment, declare in writing whether he or it is not connected with a director of the company in any of the ways referred to in subsection (1. (3) Any office or place shall be deemed to be an office or place of profit under the company within the meaning of sub-section (1), (a) in case the office or place is held by a director, if the director holding it obtains from the company anything by way of remuneration over and above the remuneration to which he is entitled as such director, whether as salary, fees, commission, perquisites, the right to occupy free of rent any premises as a place of residence, or otherwise; (b) in case the office or place is held by an individual other than a director or by any firm, private company or other body corporate, if the individual, firm, private company or body corporate holding it obtains from the company anything by way of remuneration whether as salary, fees, commission, perquisites, the right to occupy free of rent any premises as a place of residence, or otherwise. 397. Application to Court for relief in cases of oppression. 397. Application to Court for relief in cases of oppression. (1) Any members of a company who complain that the affairs of the company are being conducted in a manner prejudicial to public interest or in a manner oppressive to any member or members (including any one or more of themselves)may apply to the Court for an order under this section, provided such members have a right so to apply in virtue of section 399. (2) If, on any application under sub-section (1), the Court is of opinion- (a) that the company's affairs are being conducted in a manner prejudicial to public interest or in a manner oppressive to any member or members, and (b) that to wind up the company would unfairly prejudice such member or members, but that otherwise the facts would justify the making of a winding-up order on the ground that it was just and equitable that the company should be wound up, the Court may, with a view to bringing to an end the matters complained of, make such order as it thinks fit. 398. Application to Court for relief in cases of mismanagement. (1) Any members of a company who complain- (a) that the affairs of the company are being conducted in a manner prejudicial to the interest or in a manner prejudicial to the interest of the company; or (b) that a material change (not being a change brought about by, or in the interests of, any creditors including debenture holders, or any class of shareholders, of the company) has taken place in the management or control of the company, whether by an alteration in its board of directors or of its managing agent, secretaries and treasurers, or manager or in the Constitution or control of the firm or body corporate acting as its managing agent, secretaries, and treasurers, or in the ownership of the company's shares or, if it has no share capital, in its membership, or in any other manner whatsoever, and that by reason of such change, it is likely that the affairs of the company will be conducted in a manner prejudicial to public interest or in a manner prejudicial to interest of the company, may apply to the Court for an order under this section, provided such members have a right so to apply in virtue of section 399. (2) If, on any application under sub-section (1), the Court is of opinion that the affairs of the company are being conducted as aforesaid or that by reason of any material change as aforesaid in the management or control of the company, it is likely that the affairs of the company will be conducted as aforesaid, the Court may, with a view to bringing to an end or preventing the matters complained of or apprehended, make such order as it thinks fit. 399. Right to apply under sections 397 and 398- (1) The following members of a company shall have the right to apply under section 397 or 398- (a) in the case of a company having a share capital, not less than one hundred members of the company or not less than one tenth of the total number of its members, whichever is less, or any member or members holding not less than one-tenth of the issued share capital of the company, provided that the applicant or applicants have paid all calls and other sums due on their shares; (b) in the case of a company not having a share capital not less than one-fifth of the total number of its members. (2) For the purposes of sub-section (1), where any share or shares are held by two or more persons jointly, they shall be counted as one member. (3) Where any members of a company are entitled to make an application in virtue of sub-section (1), any one or more of them having obtained the consent in writing of the rest, may make the application on behalf and for the benefit of all of them. (4) The Central Government may, if in its opinion circumstances exist which make it just and equitable so to do, authorise any member or members of the company to apply to the Court under section 397 or 398, notwithstanding that the requirements of clause (a)or clause (b), as the case may be, of sub-section (1) are not fulfilled. (5) The Central Government may, before authorising any member or members as aforesaid, require such member or members to give security for such amount as the Central government may deem reasonable, for the payment of any costs which the Court dealing with the application may order such member or members to pay to any other person or persons who are parties to the application. " 14. SECTION 397 provides for relief in cases of oppression. It enables the members of the company who comes within the provisions of section 399, to make an application under section 897. If the affairs of the company are being conducted in a manner prejudicial to public interest or in a manner oppressive to any member or members, the court may, if satisfied about the same, instead of winding up the company make such order as it thinks fit with a view to bringing to an end the matters complained of. In our view section 397 has no application to the present case. In order to attract the provisions of section 397 it must be clearly proved that the affairs of the company are being conducted in a manner prejudicial to public interest or in a manner oppressive to any member or members. In the instant case, the acts complained of are that the defendant no. 7 who happens to be the son of the managing Director of the Company, was granted increments in his pay without the prior sanction of the company in the general meeting. The whole object of section 397 is to prevent winding up of the company. In our view, an application for winding up of the company will not be maintainable for the acts complained of in the instant case. Therefore, section 397 cannot be said to be a remedy against the violation of the provisions of section 314 of the Act. The next question is whether the remedy provided for in section 398 is a proper remedy for the enforcement of the penal provision contained in section 314 (2). If we assume that the granting of increments to the defendant No. 7 without prior sanction having been accorded by the general members, are illegal and in contravention of the provisions of section 314, in that case it has to be held that the affairs of the company are being conducted in a manner prejudicial to the interest or in a manner prejudicial to the interest of the company, as provided for in clause (a) of section 398 (1). We would uphold the contention of Mr. Banerjee that the plaintiffs could make an application under section 398 of the Act as a remedy against the violation of the provisions of section 314. We would uphold the contention of Mr. Banerjee that the plaintiffs could make an application under section 398 of the Act as a remedy against the violation of the provisions of section 314. But, the question is whether because of such a remedy provided for under section 398 the jurisdiction of the civil court is barred. 15. THE ouster of the jurisdiction of the civil court shall not be readily inferred. Unless a statute by express provision or by necessary implication oust the jurisdiction of the civil court, the civil court will have jurisdiction to try all suits of a civil nature. Section 398 of the Act does not contain any provision expressly excluding the jurisdiction of civil court. In this connection it will be pertinent to refer to the following observations of the Supreme court in (9) Dhulabhai v. State of Madhya Pradesh, AIR 1969 S. C. 78 : "where there is an express bar of the jurisdiction of the court, an examination of the scheme of the particular act to find the adequacy or sufficiency of the remedies provided may be relevant but is not decisive to sustain the jurisdiction of the civil court. Where there is no express exclusion the examination of the remedies and the scheme of the particular Act to find out the intendment becomes necessary and the result of the inquiry may be decisive. In the later case it is necessary to see if the statute creates a special right or a liability and provides for the determination of the right or liability and further lays down that all questions about the said right and liability shall be determined by the tribunals so constituted, and whether remedies normally associated with actions in civil courts are prescribed by the said statute or not." 16. NOW, we have to find whether by necessary implication the jurisdiction of the civil court is excluded. Under section 398 only those share-holders who come under section 399 can make an application under section 398. NOW, we have to find whether by necessary implication the jurisdiction of the civil court is excluded. Under section 398 only those share-holders who come under section 399 can make an application under section 398. Section 399 provides that in the case of the company having a share capital, not less than 100 members of the company or not less than 1/10th of the total number of its members, whichever is less or any member or members holding not less than 1/10th of the issued share capital of the company, and in the case of the company not having a share capital, not less than 1/10th of the total number of members of the company, shall have the right to make an application, under section 398. In the instant case, the plaintiffs have admittedly not less than 1/10th of the issued share capital and as such they could make an application under section 398. Members of the company who do not come under section 398 have no right to avail of the remedy under section 398 by making an application under that section. The Act does not make any provision for any remedy against the violation of any of the provisions of the Act relating to a matter of the company, at the instance of the share-holders who do not come under section 399 of the Act. Can it be said that the intention of the legislature was that those members will be without any remedy whatsoever against acts of oppression and acts prejudicial to the. interest of the company. If the contention of Mr. Banerjee has to be accepted then the said members who do not fall under the provisions of section 399 will be debarred from availing of any remedy in the civil court. It cannot be presumed that the legislature will deprive certain persons of any remedy under the law, either in the tribunal under the special provisions of the statute or in the civil court. It may be that in some cases a petition for winding up of the company may be made, but all illegal acts may not give rise to a cause of action for winding up of the company. As aforesaid, the object of sections 397 and 398 is to prevent the winding up of the company by bringing to an end the matters complained of. As aforesaid, the object of sections 397 and 398 is to prevent the winding up of the company by bringing to an end the matters complained of. It will be an anomalous position if it is held that the members of the company who do not come within the purview of section 399 of the Act may take resort to a civil action in the civil court while the members who come under the provisions of section 399 will have to make an application under section 397 or 398 of the Act. In our view, it cannot be said that in view of the provisions of sections 397 and 398 of the Act, the intention of the legislature was to exclude the jurisdiction of the civil court. If the legislature intendled to exclude the jurisdiction of the civil court, in that case, the legislature would have made suitable provisions for those members who do not come within the purview of section 399 of the Act. In the decision of the Madhya Pradesh high Court referred to above it has been observed that "the idea in giving exclusive jurisdiction to the courts under s. 10 in regard to matters within the purview of section 388 of the Act and restricting the right to apply under section 393 only to certain members of the company is to ensure that the business of the company is not brought to " complete standstill on proceedings initiated by any member of the company in an ordinary Court". We are unable to agree with the aforesaid view of the madhya Pradesh High Court. To accept this view, will mean that a member or members who do not come within section 399 will be without any remedy whatsoever even in extreme cases of oppression and also where the affairs of the company are being conducted by the majority in a manner prejudicial to the interest of the company. Secondly, although, the members indicated in section 399 of the Act have the right to make an application under section 397 or section 398, the granting of relief by the court on such an application is discretionary, which is apparent from the words "the court may make such order as it thinks fit" as contained in sections 397 and 398. The court may refuse to pass any order or grant any relief to applicants under sections 397 and 398. The court may refuse to pass any order or grant any relief to applicants under sections 397 and 398. The remedy provided for in sections 397 or section 393 is a discretionary remedy. Although, the members indicated in section 399 have the right to make an application either under section 397 or under section 398, they cannot as a matter of right claim reliefs on such an application. If the intention of the legislature was to totally exclude the jurisdiction of the civil court the legislature would not have made it discretionary with the court to grant relief under sections 397 and 398. For the aforesaid reasons, we hold that sections 397 and 398 do not exclude either expressly or by necessary intendment, the jurisdiction of the civil court. 17. IT was next contended by Mr. Banerjee that the suit was not maintainable in view of the provisions of section 34 of the Specific Relief Act, 1963. The provisions of section 34 of the Specific Relief Act, 1963, are substantially the same as the provisions of section 42 of the Specific Relief Act, 1877. The contention of Mr. Banerjee was that the plaintiffs not being entitled to any legal rights the provisions of section 34 of the Act which exclusively govern declaratory suits, could not be invoked. Before considering the said contention of Mr. Banerjee it is necessary to refer to the provisions of section 34 of the Specific Relief Act, 1963, which are as follows : "any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying, or interested to deny, his title to such character or right, and the court may in its discretion make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief provided that no court shall make any such declaration where the plaintiff, being able to seek further relief than a mere declaration of title, omits to do so. Explanation - a trustee of property is a "person interested to deny" a title adverse to the title of some one who is not in existence, and for whom, if in existence, he would be a trustee". 18. Explanation - a trustee of property is a "person interested to deny" a title adverse to the title of some one who is not in existence, and for whom, if in existence, he would be a trustee". 18. IF the case comes within section 34, in that case, the plaintiffs have necessarily to prove that they are entitled to any legal character or to any right as to any property. The contention of Mr. Banerjee proceeded on the footing that the instant suit was governed by section 34 and that accordingly, the plaintiffs not being entitled to any legal character, or to any legal right as to any property, the suit was not maintainable. It is true that the plaintiffs themselves are not entitled to any legal character or to any right as to any property. The suit has been instituted by the plaintiffs for the benefit of the company and if the suit is decreed the company will be benefited. It is not for the personal interest of the plaintiffs that the plaintiffs instituted the instant suit. The question is whether the instant suit comes within the purview of section 34 of the Specific Relief Act, 1963. In this connection we may refer to a decision of the Supreme Court in (10)Ramraghava Reddy v. Seshu, Reddy-AIR 1987 S. C. 436. The plaintiffs in that case, instituted a suit for a declaration that the compromise decree was not binding on the deity. It was held by the Supreme Court that a declaration of that character, namely, that the compromise decree was not binding upon the deity was in itself a substantial relief and had immediate coercive effect and that a declaration of that, kin I fell outside the purview of section 42 of the specific Relief Act and would be governed by the general provisions of the Civil Procedure Code like section 9, or Order 7, Rule 7. In the aforesaid Supreme Court decision, the plaintiffs were the worshippers of the deity and the suit was brought for the benefit of the deity. On the basis of the said Supreme Court decision it can be held that the declarations prayed for in the instant suit fall outside the purview of section 34 and will be governed by the general provisions of the Civil Procedure Code. On the basis of the said Supreme Court decision it can be held that the declarations prayed for in the instant suit fall outside the purview of section 34 and will be governed by the general provisions of the Civil Procedure Code. In short, s. 34 does not constitute an exhaustive code as to declaratory relief in India the contention of Mr. Banerjee that the suit was not maintenance in view of section 31 of the Specific Relief Act, 1963, cannot, therefore, be accepted. In our view the suit was maintainable in the form in which it was framed. The next important question for our consideration is whether the increments granted to the defendant No. 7 Jaydev Daw from time to time were tantamount to subsequent appointments within the meaning of the Explanation to Section 314 (1) of the Act. If it is held that the increments which were granted to the defendant No. 7 were subsequent appointments, such subsequent appointments not having been made with the prior sanction of the general members of the Company, the same were made in violation of the provisions of section 314 (1) of the Act, and the inevitable consequence would be that, on the first of such subsequent appointments, the Managing Director, namely, the defendant No. 2 should be deemed to have vacated his office as a Director in view of the provisions of sub-section (2) of section 314. The increments in pay which were granted to the defendant no. 7 prior to July 1, 1962 were as a result of general increments to all employees of the company. On July 1, 1962, and on September 12, 1962 the defendant No. 7 were granted special increments. 19. SECTION 314 does not define the word "appointment". It has been submitted by Mr. Banerjee that the word "appointment" pre-supposes a vacancy of a post and filling up of that vacancy by recruiting person for that post. Mr. Banerjee contended, that the defendant no. 7 having been already appointed as the Chief Accountant of the Company and there having been no vacancy in the post of the Chief accountant, and that the defendant no. Banerjee that the word "appointment" pre-supposes a vacancy of a post and filling up of that vacancy by recruiting person for that post. Mr. Banerjee contended, that the defendant no. 7 having been already appointed as the Chief Accountant of the Company and there having been no vacancy in the post of the Chief accountant, and that the defendant no. 7 having continued in that post all along, it could not be said that, merely because the defendant No. 7 was granted increments in his pay from time to time, each time the increment was granted to the defendant No. 7, he was appointed in that post. According to Mr. Banerjee if that construction is put on the word 'appointment' or on the expression "subsequent appointment'' occurring in Explanation to Section 314 (1), it would lead to anomalous results. 20. MR. Sen, on the other hand submitted that the words "and to every subsequent appointment to such office or place of profit on a higher remuneration not covered by the special resolution except where an appointment of a time scale has already been approved by the special resolution" would clearly indicate that any increment granted but not covered by the special resolution, would mean subsequent appointment within the meaning of the provisions of the Explanation. The explanation does not specifically say about granting of increments, but it provides for subsequent appointment on a higher remuneration not covered by the special resolution. In the instant case, the defendant No. 7 was appointed as a permanent incumbent to the post of the Chief Accountant of the company and as such the question of his re-appointment on a higher remuneration does not at all arise. In our view, the explanation will apply to a case when any of the persons mentioned in section 314 (1) is appointed for a term and on the expiry of that term he is re-appointed to that post on a higher remuneration. In that case, at the time of the re-appointment a prior sanction of the general members will be necessary as provided for in the explanation to 314 (1. If, however, at the time of the initial appointment the special resolution according sanction to such appointment also accords sanction to the re-appointment of that person on a time scale, no such prior sanction will be necessary. If, however, at the time of the initial appointment the special resolution according sanction to such appointment also accords sanction to the re-appointment of that person on a time scale, no such prior sanction will be necessary. The expression 'subsequent appointment' connotes break in the continuity of the service of such person to an office or place of profit and his re-appointment to' that post. In our view, there is no bar to the granting of increments in pay to that person in accordance with the rules of the company, without any prior sanction having been awarded by the members in a general meeting. Some decisions were cited at the Bar for the purpose of construing the word 'appointment' or the words 'subsequent appointment', but we do not think that those decisions are helpful as those relate to different statutes and the facts of those decisions are also different from those of the instant case. Each statute has to be interpreted on the language used by it. On the interpretation of the provisions of the explanation to section 314 (1), we hold that the expression 'subsequent appointment' does not include increments granted to a permanent incumbent who happens to be a director or the partner or relative of a director of the company. Although, we have upheld the contention of Mr. Sen that the civil court has jurisdiction to try the instant suit and that the same was maintainable as framed, we overrule the contention of Mr. Sen that by granting increments to the defendant No. 7, the Managing director of the company acted in violation of the provisions of section 314 (1) or the Explanation to that section. In our view, the trial court was right in dismissing the plaintiffs' suit. 21. FOR the reasons stated above, we set aside the judgment and decree of the lower appellate court and restore those of the trial court. The appeal is allowed but in the peculiar facts and circumstances of the case we direct each party to bear his own costs throughout.