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2005 DIGILAW 263 (DEL)

B. K. PURI v. PRIMA INTERNATIONAL PVT. LTD.

2005-02-28

A.K.SIKRI

body2005
A. K. Sikri,j. ( 1 ) FIRST, the background facts: ( 2 ) THE respondent No. 1 (hereinafter referred to as the company ) had four shareholders holding 100 shares each. These shareholders are petitioner no. 1 and petitioner No. 2 on the one side and respondent Nos. 2 and 3 on the other side who may be termed as Puri Group and Munjal Group respectively. The company was formed to take over the running business of partnership firm produkt MARKT in which both the groups held equal shares. The allegation of the petitioners is that to disturb this equilibrium, some time in September, 1979, the Munjal Group fabricated a resolution of the Board of Directors, in the absence of the first petitioner, who was abroad at that time, and allotted 10 equity shares of Rs. 100/- each to his daugther/respondent No. 4. There are certain other allegations of mismanaging the affairs of the company by Mr. I. S. Munjal while the first petitioner was abroad. It may not be necessary at this stage to state in detail these allegations. However, according to the petitioners, the Munjal Group removed the petitioner No. 1 from the office of Managing director as well as Director; deprived him from operating the bank account; whereabouts of the location of the office of the company were not disclosed; and premises of the company were used as residence of Mr. I. S. Munjal. This property is 23, Todarmal Lane, Bengali Market, of which the company was owner and was allegedly used as residence of Mr. I. S. Munjal. On his return of india, the petitioner No. 1 confronted Mr. I. S. Munjal with these purported illegalities. Mr. Munjal proposed that he was ready to pay to the first petitioner half the price of the house and he would also be paid his share in the assets of the firm and the company on proper valuation with the condition that thereafter the petitioners would sever their connection with the company. The first petitioner, under duress and coercion, accepted this offer and Mr. Munjal brought one Mr. Maier-Aichen, who was Managing Director of a German concern called Artipresent. The said Mr. Maier prepared a draft agreement. Under the said agreement the petitioners were to receive Rs. 1,37,000/- as the house was valued at Rs. 2,74,000/ -. This amount was to be paid to the petitioners in four instalments. Munjal brought one Mr. Maier-Aichen, who was Managing Director of a German concern called Artipresent. The said Mr. Maier prepared a draft agreement. Under the said agreement the petitioners were to receive Rs. 1,37,000/- as the house was valued at Rs. 2,74,000/ -. This amount was to be paid to the petitioners in four instalments. According to the petitioners, however, the value of the property was Rs. 5. 5 lacs and, therefore, the share of the petitioners was not quantified properly in the agreement. The respondents were to give share in the goodwill of the firm/company as well which was not provided in the agreement. Because of these reasons, the petitioners repudiated the agreement and filed CP No. 86/1979 under Sections 397/398 of the Companies act/1956 (for short the Act ) alleging oppression and mismanagement as well as winding up of the company. Suit for dissolution and rendition of accounts of the firm PRODUKT MARKT was also filed. Although it is not stated in the present petition as to what happened to the aforesaid petition, it transpires that the respondents filed reply to this petition stating that the petitioners concealed the fact of settlement between the parties recorded on 12th/14th November, 1979 and after that settlement since their shareholding was transferred they ceased to be members of the company and, therefore, had right to file the petition. The petitioners, in these circumstances, filed CA No. 187/1980 on 9th april, 1980 for withdrawal of the said company petition. On 5th May, 1980 CP no. 86/1979 was dismissed as withdrawn. In the present petition, this Court passed the following order on the same date: "no ground under Sections 397/398 or Section 433 in view of the dispute regarding the membership. The petition however be treated as petition under Section 155 of the Companies Act. " ( 3 ) THE Court thus allowed the present petition to be treated as one under section 155 of the Act as it needed consequential modification. Opportunity was given to the petitioners to seek leave to amend the petition. Pursuant to this order, on 21st August, 1980 the petitioners filed the. amended petition CP No. 39/1980 under Section 155 of the Act for rectification of the Register of members of the company. Opportunity was given to the petitioners to seek leave to amend the petition. Pursuant to this order, on 21st August, 1980 the petitioners filed the. amended petition CP No. 39/1980 under Section 155 of the Act for rectification of the Register of members of the company. ( 4 ) IT would, thus, become clear from the events noted upto now that this petition was treated as one under Section 155 of the Act as the petitioners wanted the rectification of Register on the ground that they continue to be the shareholders. The prayer clause of the amended petition reads as under: " (A) The transfer of 100 shares each held by the petitioner Nos. 1 and 2, effected by the respondent Nos. 1 to 4 in favour of respondent Nos. 2 and 7 or any one else, be set aside by cancelling any resolution or resolutions passed by the respondent No. 1 Company, and the register of Members be sent for and rectified by removing the names of respondent Nos. 2 and 7 or any other person in respect of the said shares and by substituting the names of the petitioner Nos. 1 and 2, respectively as before; (b) The allotment of 10 equity shares of Rs. 100/- each in favour of respondent No. 4 be set aside by cancelling any resolution passed for the purpose or otherwise, and the Register of Members be sent for and rectified by removing her name from the same; (c) The Register of Members be sent for and rectified by cancelling any other allotment or transfer made in favour of respondent Nos. 2 and 7 or any other person, except the allotment of 100 shares each in favour of respondent Nos. 2 and 3. (d) The respondents be restrained from allotting any further shares to themselves or anyone else during the pendency of the petition. " ( 5 ) WHILE this petition was entertained on the basis of aforesaid prayer and both the parties led their evidence and the matter was part-heard, the petitioner filed CA No. 393/1986 under the provisions of Order 6 Rule 17 and Order 1 rule 10 read with Section 151 of the Code of Civil Procedure seeking amendment of the petition. In this amendment, the petitioners sought to convert the petition under Sections 397/398 of the Act as well and in the alternative prayer for winding up of the company. In nutshell, the prayers which were made originally, were sought to be restored. As this application seeks to change the entire flavour of the petition insofar as prayers are concerned, it is but necessary to deal with this application in the first instance. CA No. 393 of 1986: ( 6 ) IT is clear from the narration that as per the settlement between the parties, 100 equity shares held by the petitioner No. 1 were transferred to the respondent No. 2 and 100 equity shares held by the petitioner No. 2 were transferred to the respondent No. 7. However, since the petitioners were no more holding the shares on that date, this Court passed an order dated 5th May, 1980 in this petition and this order would indicate that the Court was of the view that the petitioners, who are not the members of the company, cannot maintain petition under Sections 397/398 or for winding up of the company. They were required to first seek rectification of Register and only when such rectification is allowed and they become members that they would be entitled to file such a petition. Therefore, the present petition was treated as petition under Section 155 and the petitioners were allowed to make consequential amendment. The petitioners filed application thereafter seeking amendment of the petition and converting it into a petition under Section 155 of the Act. The prayers made in the original petition concerning mismanagement and oppression or the winding up were deleted and instead prayers for rectification of the members register were incorporated. ( 7 ) SOME further developments which took place, before application for amendment of the petition was filed in the year 1986, may now be noted. ( 8 ) AS noted above, the amount of Rs. 1,37,000/- as per the agreement dated 12th/14th November, 1979 was to be paid by the respondents to the petitioners in four instalments. The first instalment was of Rs. 35,000/- which payment was to be made upfront on signing this agreement. The respondent No. 2 had paid a sum of Rs. 35,000/- to the petitioner No. 1 on 6th November, 1979. The petitioners allege that this amount was given against repayment of loan of Rs. The first instalment was of Rs. 35,000/- which payment was to be made upfront on signing this agreement. The respondent No. 2 had paid a sum of Rs. 35,000/- to the petitioner No. 1 on 6th November, 1979. The petitioners allege that this amount was given against repayment of loan of Rs. 35,000/- previously given to the respondent No. 2 by the petitioner No. 1. The respondent No. 2, however, maintains that it was towards the first instalment as per the agreement. Fact remains that the petitioners delivered the share transfer deeds duly completed and signed by them on 16th November, 1979 to the respondents. This is so accepted by the petitioner No. 1 in his cross-examination dated 24th August, 1982. In CP No. 86/1979 order dated 24th january, 1980 was passed recording the willingness of the respondents to deposit a sum of Rs. 1 lac in this Court. Pursuant to this order, balance amount of Rs. 1,02,000/- was deposited by the respondents in this Court. This amount was thereafter withdrawn by the petitioners. Thus subject to the petitioners allegation that payment of Rs. 35,000/- made on 16th November, 1979 was not the first instalment, the petitioners have otherwise received the entire amount under the agreement. ( 9 ) INSOFAR as contention of the petitioners about the payment of Rs. 35,000/- is concerned, it does not appear to be of any substance. The agreement was entered into between the parties on 12th/14th November, 1979. Within two days, this payment is made. The amount is exactly the same i. e. Rs. 35,000/ which was to be paid as the first instalment. Therefore, it is a contemporaneous act along with signing of the agreement. Not only this, the petitioners delivered their shares also along with the share transfer deeds to the respondents. Without receiving at least first instalment there could not have been any occasion to deliver these transfer deeds. On the other hand, apart from a bald averment that Rs. 35,000/- was given by the petitioner No. 1 to the respondent no. 2 and the payment in question was for repayment of this loan nothing is produced on the record to substantiate this averment. Therefore, one can safely conclude that payment of Rs. 35,000/- was given by the respondent No. 2 to the petitioner No. 1 pursuant to the agreement dated 12th/14th November, 1979. Balance payment of Rs. 2 and the payment in question was for repayment of this loan nothing is produced on the record to substantiate this averment. Therefore, one can safely conclude that payment of Rs. 35,000/- was given by the respondent No. 2 to the petitioner No. 1 pursuant to the agreement dated 12th/14th November, 1979. Balance payment of Rs. 1,02,000/- was also made subsequently as noted above. Thus according to the respondents, the petitioners ceased to be the shareholders and ceased to have any interest in the property at 23, Todarmal Lane, Bengali market, New Delhi. ( 10 ) IT may be noted at this stage that in the earlier proceedings, namely, CP no. 86/1979 interim orders were passed restraining the respondents from alienating its immovable assets except in the ordinary course of business. However, after the deposit of Rs. 1,02,000 /- as mentioned above, vide order dated 15th February, 1980 earlier restraint order was vacated. Subsequently CP no. 86 /1979 was dismissed as withdrawn on 5th May, 1980. In these proceedings also, the petitioners filed CA No. 185/1980 seeking interim injunction restraining the respondents from alienating or encumbering or granting lease of the aforesaid property. On 16th July, 1980 hearing of this applicaion was adjourned "for consideration of the question if in view of the conversion of the main proceedings, the application survives. " On 21st August, 1980 this application was dismissed as withdrawn with liberty to file fresh one, if necessary. Thereafter, the petitioners filed CA No. 462/1981 on 25th August, 1981 for same interim relief. This application was dismissed by this Court vide order dated 25th September, 1981 on the ground of suppression of facts observing that the petitioners had not disclosed the various orders passed and taken note of above, including the payment of Rs. 1,02,000/- to the petitioners. Even on merits, no ground to pass restraint order was made out, as is clear from the following portion of the said order : "this apart, admittedly the petitioner transferred his shares in favour of i. S. Munjal. The petitioner is now pleading that a fraud had been committed on him and his wife. The only relief which can be granted to the petitioner/ if he succeeds, is that the register of members can be ordered to be rectified. No relief can be granted with reference to the said immovable property. The petitioner is now pleading that a fraud had been committed on him and his wife. The only relief which can be granted to the petitioner/ if he succeeds, is that the register of members can be ordered to be rectified. No relief can be granted with reference to the said immovable property. By an interim order, relief greater than which can be granted under the main petition cannot be ordered by this Court. When the main petition under Section 155 is disposed of the Court cannot order at that time that the property of the company may or may not be sold. With the disposal of the main petition the interim applications automatically stand disposed of. Even if CP 39 of 1980 is allowed, with the disposal of the petition the interim orders, if any, would automatically come to an end which would mean that the management thereafter could, if they so desire, transfer the property. It would not be within the jurisdiction of this court in disposing of the petition under Section 155 to give any directions restraining the company from alienating the property. There is another reason why, in my opinion, the interim relief prayed for should not be granted. In Smt. Soma Vati Devi Chand v. Krishna Sugar Mills Ltd. , AIR 1966 punjab 44, the petitioner had levelled allegations, in a petition under section 155 of the Act, about fraud being played on the part of the managing Director which had resulted in that petitioner s share being forfeited and sold. In that case it was necessary to decide as to whether soma Vati was aware of the forfeiture and sale of her shares and whether her claim in respect of her shares was within time. H. R. Khanna, J. (as he then was) held that the remedy provided by Section 155 is summary. It could be invoked in non-controversial matters requiring quick decision. Section 155 was not meant to be used for deciding disputes requiring investigation. It was further held that in that case where allegations of fraud had been levelled it would not be proper for the Court to decide those questions in summary proceedings under Section 155. It was observed that these questions could be decided only after recording evidence and in a regular suit. It was further held that in that case where allegations of fraud had been levelled it would not be proper for the Court to decide those questions in summary proceedings under Section 155. It was observed that these questions could be decided only after recording evidence and in a regular suit. The aforesaid judgment was approved by a Division Bench of this Court in the case of The Punjab Distilling Industries ltd. v. Biermans Paper Coating Mills Ltd. , ILR (1972) 1 Delhi 431. " ( 11 ) THUS interim injunction granted on 31st August, 1981 was vacated. Thereafter, the property in question was sold for a consideration which was paid by him and he is impleaded in these proceedings as respondent. Admittedly, when this property was sold, there was no injunction order in operation. At this stage, present application seeking amendment of the petition is filed. ( 12 ) MR. P. C. Khanna, learned Senior Counsel appearing for the petitioners was candid in his admission that the company had not been functioning for last number of years. The only tangible asset which the company had was the aforesaid property wich has already been sold. Therefore, relief prayed for in the petition, after its conversion into a petition under Section 155 is virtually infructuous. However, the main reason for seeking the amendment and converting it into a petition under Sections 397/398 or in the alternative for winding up is that if such an amendment is allowed, according to the petitioners, it would relate back to the date of filing of the petition which was in the year 1980. Therefore, the petitioners want that the amendment be allowed so that the petitioners are able to press for winding up of the company. If the winding up is ordered, in this petition, that order shall relate back to the date when the petition was filed in the year 1980 by virtue of Section 442 of the Act. In such an eventuality, sale of property at 23, Todarmal Lane, Bengali Market, New delhi will be treated as sale during the pendency of winding up and would, therefore, be void. Therefore, obviously whole attempt of the petitioners in seeking the amendment is to nullify the sale of the property. That is the reason the petitioners have filed this application for amendment instead of filing a fresh petition for winding up in the year 1986. Therefore, obviously whole attempt of the petitioners in seeking the amendment is to nullify the sale of the property. That is the reason the petitioners have filed this application for amendment instead of filing a fresh petition for winding up in the year 1986. ( 13 ) IN support of this application for amendment, Mr. Khanna made the following submissions: (A) Amendment should be allowed in the interest of justice as otherwise the respondents would succeed in their designs who have sold the property of the company illegally. (b) The order dated 5th May, 1980 passed by this Court observing that the petition under Sections 397/398 or winding up was not maintainable was without jurisdiction and it being a jurisdictional error, the Court can always correct the same. Submission was that the petition which was originally filed under Sections 397/398 or in the alternative for winding up, was maintainable even on that date in view of legal position contained in Sections 425, 436 and 439 (4) (b) of the Act. Even if it is presumed that the petitioners had transferred their shares, they were still contributories and, therefore, had right to file the petition as contributories as provided under section 439 (4) (b) of the Act. His submission was that order dated 5th May, 1980 was passed ignoring the aforesaid provisions and, therefore, was without jurisdiction and that as the Act of the Court prejudices no one, the amendment should be allowed by restoring the position as on the date of filing the petition as originally filed with same prayers which are now sought to be made in the amendment application. His submission was that once it is held that order dated 5th May, 1980 is a nullity, no res judicata would even apply and in support of this submission, he relied upon the judgments of the Supreme Court in the case of Mathura Prasad sarjoo Jaiswal and Ors. v. Dossibai N. B. Jeejeebhoy reported as AIR 1971 sc 2355 and in the case of Smt. Isabella Johnson v. M. A. Susai (dead) by LRs. , reported as AIR 1991 SC 993 . (c) He also submitted that grounds on which the petition was filed originally remain the same even after it was converted into a petition under Section 155 of the Act and only prayer clause was amended. , reported as AIR 1991 SC 993 . (c) He also submitted that grounds on which the petition was filed originally remain the same even after it was converted into a petition under Section 155 of the Act and only prayer clause was amended. Therefore, no prejudice would be caused to the respondents and since the averments made in the petition and the replies would remain the same, even if the amendment is allowed and prayer for winding up is entertained, it can be decided on same facts and on the evidence already recorded. ( 14 ) LEARNED Counsel for the respondents, on the other hand, submitted that the application is mala fide attempt as the learned Senior Counsel for the petitioners conceded that it was made to nullify the sale of the property. He further submitted that the petitioners had relinquished their rights and interest in the property in question by transferring their shares which was a result of the settlement between the parties and they received their full shares under the said agreement. His further submission was that order dated 5th May, 1980 whereby the petition was converted into Section 155 of the Act was not only accepted by the petitioners but acted upon as well by amending the prayer clause in line with the provisions of Section 155 of the Act and deleting the prayers relating to Sections 397/398 and winding up of the company. The petitioners thus acquiesced into the said order. He further submitted that any order which can be passed under Sections 397/398 or a petition seeking winding up is also a discretionary order and discretion lies with the Court to pass such an order or not. The Court exercised its discretion by not entertaining the petition under Sections 397/398 or for winding up and opined that it could only be a petition under Section 155 which position was accepted by the petitioners. ( 15 ) MR. Gupta, learned Counsel appearing for the purchaser, additionally, submitted that the property was purchased at a time when there was no such winding up petition and there was no restraint order of any nature against the company in selling this property. He is, therefore, a bona fide purchaser and even if the amendment is to be allowed it could be only from the date of application i. e. in the year 1986 to balance out the equities. He is, therefore, a bona fide purchaser and even if the amendment is to be allowed it could be only from the date of application i. e. in the year 1986 to balance out the equities. ( 16 ) LET me first deal the case from the point of view of equity, which will have bearing insofar as bona fides of the present application are concerned. It is an admitted case of the parties that when the disputes arose between them, intervention of Mr. Maier was sought, who was a German customer of the company. He was known to both the parties. With his intervention, the agreement dated 12th/14th November, 1979 was drawn. According to the terms of this agreement, the petitioners had agreed to transfer their shares in favour of Munjal Group for a total consideration of Rs. 1,37,000/ -. It is also an admitted fact that in computing this amount, the value of the house owned by the company at 23, Todarmal Lane, Bengali Market, New Delhi was taken at Rs. 2,74,000/ -. This agreement is signed by the parties. The amount of Rs. 1,37,000/- has also been paid and this aspect has already been dealt with by me holding that the amount is paid, including Rs. 35,000/- on 16th November, 1979 towards this agreement. Further, as already noted above, admittedly the petitioners signed the share transfer application forms and thereupon shares were transferred in favour of the Munjal Group. No doubt, the petitioners have alleged that this transfer took place as a result of fraud having been played upon them and that there could not have been a transfer without making payment of entire amount, these aspects need not detain us at this juncture having regard to the subsequent developments leading to the payment of entire amount as per the agreement. When this is state of affairs, preferring such an application for amendment with sole objective to get the transfer of property in its favour, according to me, is a mala fide attempt on the part of the petitioners. We will have to bear in mind that application seeking restraint order against the company from selling this property was filed by the petitioners (CA No. 462/1981) which was dismissed by a speaking order passed on 25th september, 1981. We will have to bear in mind that application seeking restraint order against the company from selling this property was filed by the petitioners (CA No. 462/1981) which was dismissed by a speaking order passed on 25th september, 1981. Therefore, the position which existed on the date when the property was sold was: (I) There was no petition under Sections 397/398 or winding up against the company. (ii) The only petition which was pending was under Section 155 of the act. (iii) In this very petition order dated 5th May, 1980 was passed observing that the petitioners could not maintain a petition for winding up of the company or under Sections 397/398 as they were not the members. (iv) In this petition specific attempt of the petitioners to get the injunction against the respondents from transferring the property had failed. ( 17 ) ANY person who is informed about the aforesaid facts and purchases the property would be a bona fide purchaser for a valid consideration. Therefore, a situation cannot be allowed to be created today which would affect his rights. The petitioners want not only the petition to be amended but the amendment to relate back from the date when CP No. 39/1980 was originally filed which, in the given circumstances, cannot be permitted. One has to bear in mind that as on the date of filing of this amendment application, what was pending before the Court was a petition under Section 155 of the Act. Therefore, the amendment application is to be viewed from this angle. The petitioners want to change the entire nature of the petition seeking a different and new relief altogether (which was abandoned in the year 1980 itself) after order dated 5th May, 1980 was passed. Therefore, when viewed from this angle as well, the amendment cannot be allowed. Needless to mention, even if such an amendment were to be allowed it could only be from the date of application and it is not necessary to do so as such amendment from the date of application does not serve the purpose of the petitioners and would be of no consequence as conceded by the learned Senior Counsel for the petitioners himself. ( 18 ) IN view of the above discussion, it may not even be necessary to go into the aspect as to whether order dated 5th May, 1980 was an erroneous order and could be treated as nullity in the eyes of law and that the Court committed jurisdictional error. However, I am of the opinion that it is not so. The petitioners filed petition under Sections 397/398 or in the alternative for winding up. This Court was of the view that such a petition was not maintainable and passed the following order: "no ground under Sections 397 and 398 or Section 433 in view of the dispute regarding membership. The petition, however, be treated as petition under Section 155 of the Companies Act. Notice. Counsel accepts notice. Affidavit in opposition may be filed within four weeks. Liberty to file affidavit in reply within two weeks thereafter. Enlist for further directions on July 16, 1980. " ( 19 ) THE petitioners did not challenge this order and rather acquiesced into this order by accepting the aforesaid decision and amended the prayer clause of the petition incorporating the relief of rectification of the register of members as provided under Section 155 of the Act which was the relevant provision at that time. [by the Companies (Amendment) Act, 1988 with effect from 31st may, 1991 Section 155 was deleted and the provisions of it were incorporated in Section 111. However, pending petition or proceedings are allowed to continue and to be disposed of by the Courts in accordance with the provisions of Section 155 as it stood before the said amendment. ( 20 ) THE aforesaid order may be on the basis of wrong appreciation of the position in law. However, by no stretch of imagination it can be treated as an order which is nullity. ( 21 ) I cannot agree with the submission of leaned Senior Counsel for the petitioner that order dated 5th May, 1980 is a nullity. It is not in dispute that the petitioner filed petition under Sections 397/398 as well as winding up of the company in this Court and the matter was dealt with by the Company Judge. There is no dispute that the Company Judge was having requisite jurisdiction to entertain such a petition. It is not in dispute that the petitioner filed petition under Sections 397/398 as well as winding up of the company in this Court and the matter was dealt with by the Company Judge. There is no dispute that the Company Judge was having requisite jurisdiction to entertain such a petition. The case of the petitioner, even if it is put at its highest, is that order was passed by this Court ignoring certain provisions of law. Such an order would at best be a wrong order or an order contrary to law. Or, it may be an order refusing to exercise the jurisdiction as the Court was of the opinion that such a petition under Sections 397/398 or for winding up of the company was not maintainable at the instance of the petitioner who was not borne on the Register of Members of the company. By no stretch of imagination it can be treated as an order without jurisdiction. If the Court has the jurisdiction to pass the order and order passed is wrong or illegal, it cannot be termed as an order without jurisdiction. If itwas an illegal order, remedy of the petitioners was to challenge that order by filing appeal before the Appellate Court which statutory remedy is available to any person aggrieved by such an order. The petitioners did not do so. On the contrary, they accepted that order and even acted upon that order by amending the petition in tune with the directions contained in the said order. They deleted the prayers of Sections 397/398 and for winding up of the company and instead converted the petition into one under Section 155 of the Act. ( 22 ) RECENTLY, the Supreme Court in the case of Rafique Bibi (dead) by LRs. v. Sayed Waliuddin (Dead) by LRs. and Ors. , reported as V (2003) SLT 127= (2004) 1 SCC 287 had occasion to describe and explain the distinction between an order which is illegal and the order which would be without jurisdiction and the erudite exposition of law on the point would be found in paras 6 to 8 of the said judgment which are reproduced hereinunder: "para 6: What is void has to be clearly understood. A decree can be said to be without jurisdiction, and hence a nullity, if the Court passing the decree has usurped a jurisdiction which it not have; a mere wrong exercise of jurisdiction does not result in a nullity. The lack of jurisdiction in the Court passing the decree must be patent on its face in order to enable the executing Court to take cognizance of such a nullity based on want of jurisdiction, else the normal rule that an executing Court cannot go behind the decree must prevail. Para 7: Two things must be clearly borne in mind. Firstly, "the Court will invalidate an order ony if the right remedy is sought by the right person in the right proceedings and circumstances. The order may be a nullity and void but these terms have no absolute sense: their meaning is relative, depending upon the Court s willingness to grant relief in any particular situation. If this principle of illegal relativity is borne in mind, the law can be made to operate justly and reasonably in cases where the doctrine of ultra vires, rigidly applied, would produce unacceptable results. (Administrative Law, Wade and Forsyth, 8th Edn. , 200, p. 308 ). Secondly, there is a distinction between mere adminstrative orders and the decrees of Courts, especially a Superior Court. the order of a Superior court such as the High Court, must always be obeyed no matter what flaws it may be thought to contain. Thus a party who disobeys a High court injunction is punishable for contempt of Court even though it was granted in proceedings deemed to have been irrevocably abandoned owing to the expiry of a time-limit. (ibid. , p. 312 ). Para 8: A distinction exists between a decree passed by a Court having no jurisdiction and consequently being a nullity and not executable and a decree of the Court which is merely illegal or not passed in accordance with the procedure laid down by law. A decree suffering from illegality or irregularity of procedure, cannot be termed inexecutable by the executing Court; the remedy of a person aggrieved by such a decree is to have it set aside in a duly constituted legal proceedings or by a Superior court failing which he must obey the command of the decree. A decree suffering from illegality or irregularity of procedure, cannot be termed inexecutable by the executing Court; the remedy of a person aggrieved by such a decree is to have it set aside in a duly constituted legal proceedings or by a Superior court failing which he must obey the command of the decree. A decree passed by a Court of competent jurisdiction cannot be denuded of its efficacy by any collateral attack or in incidental proceedings. " ( 23 ) THIS judgment is quoted with approval by the Supreme Court again in the case of Balvant N. Viswamitra and Ors. v. Yadav Sadashiv Mule (Dead) through LRs. and Ors. , reported as V (2004) SLT 136= (2004) 8 SCC 706 . ( 24 ) THUS viewed from any angle, the result would be to dismiss this application. It is dismissed accordingly. CP No. 39 of 1980: ( 25 ) ONCE the petitioners are not allowed to amend the petition, it remains a petition under Section 155 of the Act. However, as noted above, learned senior Counsel for the petitioners conceded that insofar as relief under Section 155 of the Act is concerned, the same has become infuctuous and would be of no consequence as neither the company is functioning nor has it any assets. Even if the petitioners were to be treated as members of this company that would be a paper formality without conferring upon them any tangible benefits. ( 26 ) THIS petition is accordingly dismissed as infructuous. Petition dismissed. .