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Dishnet Wireless Ltd. and Ors. Vs. S. Tel Pvt. Ltd. and Ors. - (Telecom Disputes Settlement and Appellate Tribunal) (07 Sep 2017)

Adjudicatory proceedings before Tribunal will not be affected by the provisions in the Companies Act


Media and Communication

In present matters, execution applications have been filed and are pending. Matters are against S. Tel Pvt. Ltd. which is facing liquidation proceedings in Punjab & Haryana High Court, which has already appointed an Official Liquidator. The second group is of telecom and broadcasting petitions directed against Tulip Telecom Ltd. which is under liquidation as per proceedings in the Delhi High Court which has appointed the Official Liquidator in that matter. The third group consists of telecom petitions against Loop Mobile (India) Pvt. Ltd. against which liquidation proceedings are pending in Bombay High Court which has also appointed Official Liquidator. The order dated 6th July, 2017 further discloses that, as per stand of the Official Liquidator, a preliminary issue has arisen that, whether the Petitioners require to take permission of the High Court in the pending liquidation proceedings for proceeding with the present matters in the Tribunal in the light of Section 446 of the erstwhile Companies Act and Section 279 of the Companies Act 2013.

As per Sections 14 and 14A of Telecom Regulatory Authority Of India Act, 1997, this Tribunal has been vested with exclusive jurisdiction to adjudicate any dispute between a licensor and a licensee; between two or more service providers and between a service provider and a group of consumers, along with similar exclusive power to hear and dispose of appeal against any direction, decision or order of the Authority under the Act. The Central Government or a State Government or a local authority or any person can make an application for adjudication of any dispute covered by clause (a) of Section 14 of Act, only before the Tribunal. By virtue of Section 14M of Act, all applications, pending for adjudication of disputes before the Authority before the establishment of Appellate Tribunal got transferred to the Tribunal and under Section 14N of Act, all appeals pending before the High Court, before the commencement of the amendment Act, 2000 also got transferred to the Appellate Tribunal on its establishment under Section 14 of Act. Section 15 of Act, explicitly provides that, no civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Appellate Tribunal is empowered by or under the Act to determine and no injunction shall be granted by any court or other authority in respect of action taken or to be taken in pursuance of any power conferred by or under the Act.

In the erstwhile Companies Act 1956, Section 446(1) of Act mandated that, upon making of a winding-up order or appointment of a provisional liquidator, no suit or other legal proceedings shall be commenced or if pending, shall be proceeded with, against the company, except by leave of the court. As per sub-section (2), the winding-up Court, notwithstanding anything contained in any other law for the time being in force, shall have jurisdiction to entertain or dispose of any suit or proceeding in respect of the company, whether such suit or proceeding has been instituted before or after the order for winding-up. Sub-section (3) provided that, any suit or proceeding by or against the company pending in any other Court, notwithstanding anything contained in other law for the time being in force be transferred to and disposed of by the winding-up court. Of course, these provisions would not apply to any proceeding pending in appeal before the Supreme Court or a High Court.

For the purpose of deciding the issue at hand, it is noticeable that there is no material change, when the contents of Section 446 of the erstwhile Companies Act are compared with conjoint provisions of Sections 279 and 280 of the Companies Act, 2013. Adjudicatory jurisdiction of this Tribunal is exclusive and special under the Act whose provisions conferring such power over the Tribunal must be construed as parts of a special statute. On the other hand, the relevant provisions of the Companies Act are clearly general part of a general statute governing the companies in general. Hence, it is held that the adjudicatory proceedings before this Tribunal will not be affected by the provisions in the Companies Act. As a consequence, these will be heard and decided by the Tribunal and the Petitioners are not required to approach the Winding-up Court for seeking any permission for that purpose.

Regarding execution proceedings, it is notable that there is nothing special or exclusive so far as this jurisdiction of the Tribunal is concerned. Section 19 of Act, merely enables the Tribunal under the Act, to execute its order as a decree of civil Court and for that, it can exercise all the powers of civil court. It also enables the Tribunal to transmit any order to a civil court having local jurisdiction and such civil court shall execute the order as if it were a decree made by that Court.

The procedure and power relating to execution are in most general terms and there is no requirement of any purposive interpretation to hold or declare this power to be exclusive or special power of the Appellate Tribunal. On the other hand, some of the beneficial provisions under the Companies Act, such as provisions for giving priority to the dues of the workers warrant a different view on this issue so that at the stage of execution, the purpose of special provisions in the Companies Act creating priorities in favour of workmen in respect of their dues and also in favour of secured creditors are preserved and promoted. Hence, in the executions proceedings, the applicants will have to seek leave of the Tribunal under Section 279 or they can seek leave of this Tribunal for transfer of execution proceedings to the execution Court/Tribunal which shall have jurisdiction to entertain and dispose of such proceedings under Section 280(a) of the Companies Act. The preliminary issue is decided accordingly. Applicants in the Executions Applications shall take required steps in the light of this order at an early date.


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